congressional budget office obesity and health costs remarks by peter r. orszag director,...
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Congressional Budget Office
Obesity and Health Costs
Remarks by Peter R. Orszag
Director, Congressional Budget Office
May 2007
Total Federal Spending for Medicare and Medicaid Under Assumptions About the Health Cost Growth Differential
1966 1972 1978 1984 1990 1996 2002 2008 2014 2020 2026 2032 2038 2044 2050
0
5
10
15
20
25Actual Baseline
Projection
2.5 Percentage Points
1 Percentage Point
Zero
Differential of:
Percent of Gross Domestic Product
Medicare Spending per Capita in the United States
Source: Dartmouth Atlas of Health Care.
Note: Overweight is defined as having 25 ≤ BMI < 30; obese as BMI ≥ 30; and healthy weight as 18.5 ≤ BMI < 25
Source: Centers for Disease Control and Prevention (2005)
Proportion of Individuals Ages 20 to 74, by Weight Status, 1960-2002
1960-1962 1976-1980 1999-2002
Healthy Weight Overweight Obese
Children and Adolescents Considered Overweight, by Age Group, 1971-2002
Note: Overweight is defined as BMI at or above the sex- and age-specific 95th percentile BMI cutoff points from the CDC Growth
Charts: United States
Source: Centers for Disease Control and Prevention (2005)
6.1
5
10.5
16.115.8
4.0
6.5
11.3
0
2
4
6
8
10
12
14
16
18
1971-1974 1976-1984 1988-1994 1999-2002
Perc
en
t O
verw
eig
ht
Ages 6-11 Ages 12-19
Change in Percentage Obese, by Educational Attainment and Sex, 1971-1994
Source: Cutler (2003)
0
5
10
15
20
25
30
35
40
<High School High School College +
Per
cen
t O
bes
e
% Obese in 1971-1975 for Women/Men
Increase in Obesity by 1988-1994 for W/M
0
5
10
15
20
25
30
35
<$25,000 $25,000-$40,000 $40,000-$60,000 >$60,000
Pe
rce
nt
Ob
es
e
1971 - 1974
2001 - 2002
Income
Obesity by Income Levels, 1971-2002
Source: American Heart Association
Level and Trend of Obesity in Selected OECD Countries, 1978-2005
Source: FAOSTAT & OECD Health database as cited in Bleich et al. (2007) “Why is the Developed World Obese?”
0.0
5.0
10.0
15.0
20.0
25.0
30.0
35.0
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
Per
cen
t O
bes
e
Australia
Finland
Japan
Netherlands
United Kingdom
United States
Attributable Fraction of Obesity Due to Calories In and Calories Out, Across Countries, 2005
Source: FAOSTAT & OECD Health database as cited in Bleich et al. (2007) “Why is the Developed World Obese?”
0%
20%
40%
60%
80%
100%
Finland Japan Spain United States Canada Norway All Countries
% to calories in % to calories out
Meal 1977-1978 1994-1996 Change
Male Meals 1819 1846 27
Snacks 261 501 241
Total 2080 2347 268
Female Meals 1330 1312 -17
Snacks 186 346 160
Total 1515 1658 143
Source: Continuing Survey of Food Intake 1977-1978 and 1994-1996, as cited in Cutler, Glaeser, Shapiro (2003)
Change in Caloric Intake, 1977-1996
Obesity and Food Technology
Increase in obesity may be the result of the technological changes in food processing.
Increased technology has cut down the time for food preparation, making food more available and cheaper.
This argument is supported by the demographic trends, which show that obesity has grown most among women since the 1970s.
The increase in caloric intake comes mainly from snacks, the foods with the greatest amount of processing.
What food can you buy with a $1?
To get 2,400 calories, need less than $1 if getting them in oils and sugars
Cheap, unhealthy food:
$1 can buy 2,400 calories worth of white pasta $1 can buy 500 calories worth of potatoes $1 can buy 500 calories worth of cereal
Expensive, healthy food:
$1 can buy 30 calories of fish $1 can buy 2.4 calories of raspberries $1 can buy 8 calories worth of arugula
Incentives and Behavior
Some studies show that consumption is influenced by availability of food rather than taste or hunger:
Stale Popcorn Vending Machines in Schools
Possible to help people make healthier decisions
Diseases Associated with Obesity
Type 2 Diabetes Cardiovascular Disease Cancer (Endometrial, postmenopausal breast, kidney,
and colon) Musculoskeletal Disorders Sleep Apnea Gallbladder Disease
Obesity and Health Care Costs
Obese people incur health costs about 36% higher than people of normal weight.
2001 mean per capita spending: Normal weight: $2,907; Overweight: $3,247; Obese: $3,976
Thorpe et al (2004) shows that between 1987 and 2001, per capita spending rose $1,110. That growth in spending would have only been $809 if not for increase in obesity and obesity costs. That extra $301 in growth is attributed to obesity.
Although obesity is costly, there is very little evidence that obesity decreases life expectancy as is the case with smoking.
Mean per Capita Spending by Weight Status, 2001
$3,255
$2,907
$3,247
$3,976
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
Underweight Normal Overweight Obese
Source: Thorpe (2004)
Proportion of Increasing Health Costs Driven by Obesity
Increased Costs of Treating
Obesity
Increased Obesity
Obesity-Driven Increase
Total Increase in per Capita Spending: $1,110
27%
Source: Thorpe (2004)
Possible Tools to Curb Obesity
Education
Increasing Food Prices- Several states have extra taxes on soft drinks- Recent proposals: - Detroit: Mayor proposing 2% fast-food tax - British Medical Association: 17.5% tax on
high-fat foods- Could also subsidize healthy foods
Regulation