The Economics of Overweight and Obesity - The High Cost Of Overweight And Obesity, The High Cost Of Losing Weight, Catering To An Expanding Market
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Obesity has become a crucial health problem for our nation, and these findings show that the medical costs alone reflect the significance of the challenge. Of course, the ultimate cost to Americans is measured in chronic disease and early death. We must take responsibility both as individuals and working together to reduce the health toll associated with obesity.—Tommy G. Thompson, U.S. Department of Health and Human Services Secretary, commenting on estimates that U.S. obesity-attributable medical expenditures reached $75 billion in 2003 and that taxpayers finance about half of these costs through Medicare and Medicaid, in a press release from the Centers for Disease Control and Prevention, January 21, 2004
The economic impact of obesity is considerable. The World Bank estimated the cost of obesity in the United States as 12 percent of the national health-care budget in the late 1990s. The increasing prevalence of overweight and obesity in the United States has resulted in a corresponding increase in direct and indirect health-care costs. Direct health-care costs are those incurred for preventive measures, diagnostic, and treatment services. Examples of direct health-care costs are physician office visits, hospital and nursing home charges, prescription drug costs, and special hospital beds to accommodate obese patients. Indirect costs are measured in terms of decreased earnings—lost wages and lower productivity resulting from inability to work because of illness or disability, as well as the value of future earnings lost by premature mortality (death).
According to the American Obesity Association (AOA), the Social Security Administration pays about $77 million per month to the approximately 137,000 persons who met obesity requirements for disability under criteria used prior to May 15, 2000, when a new policy was issued. Most people who qualified for benefits under the earlier policy suffered from obesity-related muscular or skeletal problems that prevented them from working.
There also are personal costs of obesity—obese workers may earn less than their healthy-weight counterparts because of job discrimination. Many insurance companies, particularly in the life insurance sector, charge higher premiums with increasing degrees of overweight. When obesity compromises physical functioning and limits activities of daily living, affected individuals may require assistance from home health aides, durable medical equipment such as walkers or wheelchairs, or other costly adaptations to accommodate disability.