Certain types of obesity-prevention policies involving children could result in more than $40 billion in lifetime federal savings, suggests a new report from the Campaign to End Obesity.
Author Alex Brill, the CEO of an economic-policy consulting firm called Matrix Global Advisors, urges the Congressional Budget Office to develop the capacity to estimate the cost of obesity-prevention policies over a 75-year period. Now, the CBO typically creates 10-year projections when estimating the costs of proposed federal legislation.
Brill believes this 10-year period to be inadequate for properly evaluating the effects of obesity-prevention proposals, as "effective preventative-health measures can have long-run budgetary impacts that differ greatly from their 10-year projections."
"In fact, very little of the federal savings they induce may be captured in the first decade, especially if an intervention is geared toward children or young adults and yields meaningful impacts on health-care costs for individuals receiving Medicare decades in the future," he says in the report.
Roughly 12.5 million U.S. children and teenagers (ages 2-19) were considered obese in 2009-10, according to the report. (More recently, 31.3 percent of U.S. children ages 10-17 were found to be overweight or obese in 2011-12.) The percentage of obese youths in the U.S. has nearly tripled over the past 10 years, a 2011 report from the Trust for America's Health and Robert Wood Johnson Foundation found.
Preventing obesity during childhood results in the greatest federal savings, suggests the report from the Campaign to End Obesity, making a 75-year window more appropriate than a 10-year window for the CBO to consider results of obesity-prevention policies. The report notes that the CBO recently included a 75-year estimate in a study about an increase in the cigarette tax, meaning that the proposed window wouldn't be without precedent.
Brill and the campaign created 75-year savings estimates for a few obesity-prevention policies specifically targeting children: obesity screenings and a childhood-obesity demonstration project.
Assuming that obesity screenings resulted in a child avoiding becoming obese later in life, the campaign estimated $44,100 of lifetime federal savings for an average married female taxpayer who is a secondary earner and $113 in savings for an average male taxpayer. The massive discrepancy between the savings for males and females largely boils down to higher wages for females and decreased health-care costs being offset by additional longevity costs for males.
If the screenings kept 1 million children at a normal weight throughout their lives, it would result in estimated federal savings (not counting the cost of the intervention itself) of anywhere from $113 million (if all boys) to $44.1 billion (if all girls), the report suggests.
Brill and the campaign also examined what 75 years worth of savings from the Centers for Disease Control and Prevention's Childhood Obesity Demonstration Project might look like. Assuming the demonstration helped children maintain a normal weight throughout their lives, it would create an estimated lifetime federal savings of $41,500 for an average female Medicaid beneficiary and $30,600 for an average male Medicaid beneficiary, according to the report.
If said demonstration helped 1 million children who would eventually become Medicaid beneficiaries stay at a healthy weight throughout their lives, it could result in federal savings of $30.6 billion (if all boys) to $41.5 million (if all girls), the campaign estimates.
Brill and the campaign acknowledge limitations in their 75-year projections, notably the assumption that the obesity-prevention policies would work as expected. They conclude, however, that the 10-year window "presents a distorted perspective on the actual federal budgetary impact of an effective health-prevention measure," raising the need for more long-term cost estimates.
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