An Economic Assessment of Food Safety Regulations

Table 8--Estimated benefits and costs of HACCP rule over 25 years

1

Benefits

Costs

Benefit Scenario

Low

High

Low

High

Billion dollars (1995)

Preliminary FSIS 1995 proposal

8.4

42.1

2.3

2

2.3

2

Low-range benefits estimates

1.9

9.3

1.1

3

1.3

3

Mid-range benefits estimates I

4.7

23.4

1.1

3

1.3

3

Mid-range benefits estimates II

26.2

95.4

1.1

3

1.3

3

High-range benefits estimates

47.2

171.8

1.1

3

1.3

3

1

Benefits begin to accrue in 2000 and extend for twenty years

2

Initial cost estimates from table 6, updated to 1995 dollars using the CPI.

3

Final cost estimates from table 6, updated to 1995 dollars using the CPI.

Source: Economic Research Service

11

We treat costs as point estimates and benefits as a range.  It

is likely that the HACCP rule may impose additional costs on firms

that are not included in the FSIS cost estimates, or that some firms

are already applying HACCP procedures, in advance of the new rules,

in which case costs could be lower.

---

16

Economic Research Service/USDA

An Economic Assessment of Food Safety Regulations

cold during processing, distribution, sale, and storage.

Meat and poultry products should be kept refrigerated

until just prior to cooking.   In addition, USDA recom-

mends that frozen products be defrosted in the refrigera-

tor, rather than at room temperature.

Microbial pathogens can be destroyed by cooking foods

to a proper temperature.  For example, 

E.  coli O157:H7

is killed when foods are cooked to 160

o

F.  Pathogens

present on the surface of meat or poultry products are

killed by broiling or baking.  Ground food such as ham-

burger and sausage, however, may contain pathogens

throughout the product; failure to thoroughly cook

hamburger patties and other ground meats increases the

probability that pathogens will pose a health risk when

the food is eaten.   Insufficiently cooked hamburgers

served at a fast-food restaurant were the cause of a

widely publicized outbreak of 

E.  coli O157:H7 illnesses

in four Western States in 1993.   Experts recommend

that hamburgers be cooked until the juices run clear, no

evidence of pinkness remains, and the patty is firm when

poked.

Finally, proper handling of uncooked meat and poultry

products can reduce the possibility of contamination by

microbial pathogens.  Bacteria present on the surface or

in the juices of raw products can be spread through

contact with other foods or contact with utensils or

preparation surfaces.   For example, if hamburger patties

are prepared on a cutting board, which is then used to

chop vegetables for a salad, pathogens may be spread

to the salad.   If utensils and preparation surfaces are not

kept clean between uses, this cross-contamination may

lead to potentially dangerous exposure to microbial

pathogens.

Consumers can take action to prevent foodborne ill-

nesses by following recommended practices for safe

food handling and preparation.  Since 1993, the USDA

has required that all packaged meat and poultry products

include a label providing information on safe handling

and preparation.  In addition, USDA tries to educate the

public on the importance of safe food handling and how

consumers can protect themselves from the risks of

foodborne illness (call 1-800-535-4555 for the hotline).

There is some evidence that recent efforts in this area

have had some effect.  A study by Neis and van Laanen

(1995) showed that when consumers were educated

about food safety principles, the number of people

consuming rare or pink hamburgers fell by 73 percent

and other unsafe behaviors decreased.  A study by

Tamplin et al. (1995) of 33 cancer patients before and

after a food-safety education program showed that after

patients were exposed to food-safety information, the

prevalence of unsafe practices decreased as well.  The

public probably also responds to news stories highlight-

ing food-safety outbreaks.   ERS research has found that

the percentage of people who cook hamburgers rare or

medium fell from 23 percent in 1993 to 18 percent in

1996.  This may be a response to publicity about the

1993 

E.  coli outbreak  (Lin and Ralston, 1996).

New data from the Food Marketing Institute (FMI)

present a mixed picture.  In its most recent survey of

consumer attitudes in the supermarket, FMI asked

shoppers about the impact of safe-handling labels on

safety awareness.  Among those who were aware of

safe-handling labels, 65 percent said the labels made

them more aware of food safety issues, while 34 percent

said their awareness of food safety had not changed.

Forty-three percent of shoppers reported changing their

behavior in response to the labels, while 57 percent did

not.  The most prevalent changes reported were wash-

ing/disinfecting counters, cooking areas, utensils, etc.,

after contact with meat (41 percent).  Other changes

included washing hands before or after handling meat or

washing hands more frequently (19 percent), cooking

properly or cooking to correct temperatures (19 percent),

and not allowing meat to thaw on the counter (11 per-

cent) (FMI, 1996).

Ideally, if everyone adopted safe food handling and

preparation practices, the risk of foodborne illness would

be substantially reduced.  However, it is not certain that

labeling, education, and provision of information can

completely eliminate the health risks from microbial

pathogens.  To be effective, the labeling and education

must change consumer behavior, and this change must

be permanent if the health benefits are to persist.

Given exposure to risk information, the consumer must

then pay attention to the information, understand its

meaning and personal relevance, remember and retrieve

it when needed, and act in accordance with the recom-

mendation.  If any one of these steps is not successfully

completed, the information provided is not sufficient to

change behavior.

Several factors could reduce consumer adoption of

recommended food handling and consumption practices:

·

Consumers may not view themselves as being at

risk.  Research by ERS shows that when respon-

dents are asked “compared to other men/women

who eat as many hamburgers as you do, what

would be YOUR chances of getting sick, sometime

in the next 12 months, from a hamburger patty

because of the way it is cooked,” 52 percent of

respondents chose  “my chances are smaller than

average,” while 8 percent chose “larger than aver-

age”  (Lin and Ralston, 1996).    This perception

---

17

Economic Research Service/USDA

An Economic Assessment of Food Safety Regulations

may be reinforced for consumers who have been

consuming undercooked food or using unsafe

preparation practices for years and have not be-

come ill (or not realized that the food had made

them ill).

·

Consumers may view the probability of contamina-

tion as being small.  If consumers do not believe

they have ever become ill from food or feel they are

not at risk, then they may be prone to believe that

the risks are small.

·

Consumers may inappropriately believe that,

because meat and poultry are inspected by the

USDA, the risks of foodborne disease are minimal.

The public may believe that efforts to strengthen

meat and poultry inspection have eliminated the

risk of foodborne illness, and hence the need to

practice safe food-handling procedures is no longer

necessary.

·

Consumers may feel that proper cooking of foods

makes them less appealing.  Some individuals may

prefer the taste and texture of rare hamburgers,

even if they realize that rare foods may pose a

greater safety risk.

·

Consumer habits are ingrained.  Behavioral choices

are strongly influenced by past behavior and experi-

ence.  If   consumers have eaten undercooked

foods for years and have not become ill, they could

be reluctant to make long-term changes in food

preparation and consumption practices.

All of these factors suggest that consumer education on

safe food handling and consumption could face a difficult

challenge in changing behavior to reduce foodborne risk.

Although necessary and useful, education and labeling

alone may not prove an acceptable substitute for other

efforts to reduce foodborne disease.