Economic Implications of Obesity Management

1. Economic Implications of Obesity Management

2. Economic Consequences of ObesityWhy Should You Care? • Span the ages from childhood through old age • The costs are borne: • Personally • By employers • By the government • By taxpayers Not stratified to Obese and Overweight by cost

3. Economic Burden of Obesity - Similar to Other Chronic Diseases Direct cost of chronic diseases in the U.S. ($2003) Billions, $ Obesity 1 75.0 Type 2 Diabetes* 2 73.7 Coronary heart disease 3 52.4 Hypertension 4 28.2 Arthritis 5 23.9 Breast Cancer 6 7.1 1 Finkelstein EA, Obes Res 2004;12, 4. Hodgson TA et al. Med Care 2001;39:599, 2 ADA Diabetes Care, 2003;26:917, 5 Yelin & Callahan. Arthritis Rheum 1995;38:1351, 3 Hodgeson TA et al. Medical Care 1999:37:994. 5 Brown ML, et al. Medical Care; 2002;40(suppl): IV-104, Courtesy of Anne Wolf, MS, RD.

4. Obesity Contribution to Health Care Costs Wolf AM, Colditz GA. Obes Res. 1998;6:97.

5. Estimated Obesity-Attributable % U.S. Business Health Care Spending on Selected Diseases 85.5% 27.0% 46.8% 46.0% 36.2% 18.7% 19.0% 15.9% Thompson D, Edelsberg J, Kinsey K, Oster G, et al. Estimated Economic Costs of Obesity to U.S. Business. Am J Health Promot 1998: 13(2): 120-127.

6. Health Care costs of Obesity Costs Stratified by BMI BMI = body mass index. Rate ratio reference group is BMI 20-25 kg/m2. P value represents association between BMI and cost or utilization specified. Am J of Manage Care, March 1998.

7. Obesity Effect on Expected Lifetime Medical Care Costs* in Men Costs ($)* 55-64 45-54 Age (y) 35-44 37.5 32.5 27.5 22.5 Body Mass Index (kg/m2) *Total cost of CHD, type 2 DM, hypertension, hypercholesterolemia, stroke Thompson et al. Arch Intern Med 1999;159:2177.

8. Obesity Effect on Expected Lifetime Medical Care Costs in Women 40,000 30,000 Costs ($) 20,000 55 -64 10,000 45 - 54 Age 35 - 44 0 37.5 32.5 27.5 22.5 BMI (kg/m2) *Total cost of 8 diseases: CHD, type 2 DM, hypertension, hypercholesterolemia, stroke, gallbladder disease, osteoarthritis of knee, endometrial cancer. Adapted from Thompson D et al. Arch Intern Med 1999;2177-2183.

9. Expected Lifetime Medical Care* Savings of Sustained 10% Weight Loss by Age and Initial BMI (Women) 6000 5000 4000 Costs ($) 3000 55 - 64 2000 45 - 54 1000 Age 35 - 44 0 37.5 32.5 27.5 BMI (kg/m2) *Total cost of 5 diseases: CHD, type 2 DM, hypertension, hypercholesterolemia, and stroke. Adapted from Oster G, et al. Am J Public Health 1999;89:1536-1542.

10. Medical Resource Use for Obese, Nonobese Patients - 1Year Data *Two-part regression model (Berk and Lachenbruch 2002) Raebel, M. et al. Arch Intern Med 2004;19(164):2135-2140.

11. 2.3% - Cost increase for each higher BMI unit 52.9% - Cost increase for each major associated co-morbidity Cost Difference Raebel, M. et al. Arch Intern Med 2004;19(164):2135-2140.

12. Healthcare visits Pharmacy Laboratory tests All outpatient services All inpatient services Total healthcare Increase Healthcare Costs - Obese Compared with Lean 17,188 Patients-1 Year Data Increase in Cost Compared with Lean Subjects (%) BMI 30 - 34 kg/m2 BMI ≥ 35 kg/m2 *HMO Setting: Northern California Kaiser Permanente Quesenberry CP Jr et al. Arch Intern Med. 1998;158:466-472.

13. Economic Impact on Employers • Bear a major part of the insurance burden for their employees • BMI > 30 mg/dl impacts productivity and all indirect morbidity outcomes • Rise in one BMI unit = a 1.9% rise in median health costs among 5689 managed care members Pronk NP, et al. JAMA. 1999;28:;2235-2239.

14. Lean Obese* Economic Effect of Obesity in Workplace 3-Year Costs to First Chicago NBD $1,546 $6,822 $4,496 $683 Healthcare Absenteeism *BMI > 27.8 kg/m2 in men; > 27.3 kg/m2 in women. Burton et al. J Occup Environ Med 1998;40:786.

15. Employer Cost of Obesity • Obesity is associated with • 39 million LOST work days • 239 million RESTRICTED activity days • 90 million BED days • 63 million PHYSCIAN visits The National Business Group on Health, Institute on the Costs and Health Effects of Obesity, August 2004.

16. Employer Costs of Obesity • Total cost to US companies- $13 billion/year Health Insurance Costs- $8 billion Paid sick leave costs - $2.4 billion Disability insurance - $1 billion The National Business Group on Health, Institute on the Costs and Health Effects of Obesity, August 2004.

17. Employer Cost of Obesity • 8% of private employer medical claims are due to overweight and obesity • 36% higher in/out patient spending • 77% higher medication spending • 45% more inpatient days • 48% more payments over $5000 • 11% higher annual healthcare costs The National Business Group on Health, Institute on the Costs and Health Effects of Obesity, August 2004.

18. Contribution to Total Cost of Primary Medical Care California, Year 2000- 2,579,444 Adults Chenoweth, D. (2005). The Economic Costs of Physical Inactivity, Obesity, and Overweight in California Adults During 2000: A Technical Analysis. Cancer Prevention and Nutrition Section, California Department of Health Services, Sacramento, California.

19. Obesity in the Short termIncreases Health Care Costs

20. Obesity Wage Differentials Baum C, Ford W. Health Economics. 2004;13:885-899.

21. Obesity Wage Differential by Gender Baum C, Ford W. Health Economics. 2004. 13:885-899.

22. US Navy - Active Duty Personnel • Obesity-related costs and career outcomes: • 25% of separations and retirements in obesity group were attributed to obesity co-morbidity (DM, CHD, HBP) Hoilberg, A. McNally, MS. 1991;156[2]:76-82.

23. US Air Force - Cost of Overweight • 20.4% Air Force men - overweight 1997 • 20.5% Air Force women - overweight 1997 • $22.8 million/year - total medical costs of excess body weight in Air Force personnel • 28,351 days/year - as medical overweight lost duty days Robbins. Military Medicine 2002;167(5):393-397.

24. 9 Year Total Healthcare Costs Thompson, D. et al. Obes Res. 2001;9(3):210-218.

25. 9 Year Costs of Prescription Drugs Thompson, D. et al. Obes Res. 2001;9(3):210-218.

26. 9 Year Costs of Outpatient Services Thompson, D. et al. Obes Res. 2001;9(3):210-218.

27. 100 80 60 40 20 0 Obese 20 years’ aging* Smoking (current) Overweight Problem drinking Smoking (past) Percent Change Medication Services Cost Increases Associated with Obesity and 20 Years Aging 1998 Sources: Author’s calculation based on data from the Healthcare for Communities (HCC) survey, wave 1. * Twenty years’ aging is from age thirty to age fifty. Sturm. R. Health Affairs. March/April 2002.

28. Aging Population • Aging population has important implications for expenditures by Medicare • Medicare is the largest single source of health care spending Daviglus. M. et al. JAMA. 292(22): 2743-2749.

29. Medicare Charges Age 65 Years to Death or Age 83 Years (1984 – 2002), by Baseline BMI (1967 – 1973) *Adjusted for baseline age, race (indicator for black), education (years), and smoking (cigarettes/d). Additionally, to component of the consumer price index. †For all rows, p < 0.001 for trend across 4 BMI Groups based on BMI as a continuous variable entered in a modified Cox regression model. ŧp < 0.001 for comparisons with the non overweight group (BMI 18.5 – 24.9) §p < 0.001 for comparisons with the nonoverweight group (BMI 18.5 – 24.9) Daviglus. M. etal. JAMA. 2004;292(22):2743-2749.

30. Medicare Charges • Baseline BMI related to Medicare costs for: • CVD • Diabetes • 7% of Medicare charges are for obesity Daviglus. M. et al. JAMA. 2004,Vol.292, No.22:2743-2749.

31. Difference in Cost in Severely Obese • 84% higher total difference in charges –severely obese vs non-overweight men • 88% higher total difference in charges- severely obese vs non-overweight women Daviglus. M. et al. JAMA. 2004;Vol.292, No.22:2743-2749.

32. 9.1% of the total annual US medical expenditures in 1998 - attributable medical spending for overweight and obesity: $78.5 billion • Medicare and Medicaid finances 50% of the cost Finkelstein EA. et al. Health Affairs Policy J. of Health Sphere May 2003.

33. Childhood/Adolescent Health Costs • $9 – $20: Cost of a single day of absenteeism for a student • 9 days: Median # sick days away from school for the most overweight students • Obesity associated annual hospital costs for children and youth more than tripled over the last two decades • $35 million in1979 – 1981 • $127 million in 1997 – 1999 Action for Healthy Kids- The Learning Connection- Value of Improving Nutrition and Physical Activity in Our Schools. Preventing Childhood Obesity: Health in the Balance. 2005. Institute of Medicine. Childhood Obesity Prevention Study.

34. Obesity Medications • Obesity medications produced substantial weight loss • Drug cost savings for obesity co-morbid conditions • Subjects were taking medications for: • Diabetes • Hyperlipidemia • Hypertension • Pharmaceutical cost computed for: • Weight loss • Cardiac risk reduction • Lipid reduction • Glucose reduction Greenway FL, Ryan DH, Bray GA. Obesity Research. 1999;7:523-531.

35. Weight Management for Diabetes, Hypertension, and Dyslipidemia - Saves Money % Loss From Initial Weight Obesity Comorbidity Diabetes (insulin RX) $104 7% Diabetes (sulfonylurea Rx) $55 7% Hypertension $20 10% Dyslipidemia $61 5% Savings/ Month Greenway FL, Ryan DH, Bray GA. Obesity Research. 1999;7:523-531.

36. Quality of Life and Obesity • Quality of life - altered by obesity • Quality of life - decreases with increasing obesity • Quality of life - slightly worse for women compared to men Livingston EH, Ko CY. Obesity Research. 2002; 824-832.

37. Quality of Life for the Obese Patient • Most obese have the poorest quality of life • Quality of Life improves with weight loss Kolokin, R. et al. Obesity Research. 2001.

38. Five Keys • Obesity is a serious problem. • Risk assessment drives treatment options. • Modest weight loss = Major health benefits. • Lifestyle is the foundation of treatment. • PCP’s have special role: • Promote lifestyle for all patients. • Help patients with weight loss, including prescribing and referral for surgery.

39. Physical Self- Sexual Public IWQOL-Lite Function Esteem Life Distress Work Total -0.0 -0.1 -0.2 -0.3 -0.4 -0.5 -0.6 -0.7 -0.8 -0.9 -1.0 -1.1 1-Year IWOOL-Lite Per-Item Change +/- SE < 10% Weight Loss 10% - 14.9% Weight Loss 15% - 19.9% Weight Loss 20% + Weight Loss Weight Loss and IWQOL-Lite Scores Kolokin, R. et al. Obesity Research. 2001.

40. Effect of Obesity and 20 Years Aging on Chronic Medical Conditions and Health-Related Quality of Life, 1998 Obese 20 years’ aging* Smoking (current) Overweight Problem drinking Smoking (past) 2.0 1.5 1.0 0.5 0.0 Decline in health-related quality of life (0 - 100 scale) Increase in number of chronic conditions Sources: Author’s calculation based on data from the Healthcare for Communities (HCC) survey, wave 1. * Twenty years’ aging is from age thirty to age fifty. Effects of Obesity, Smoking and Drinking on Medical Problems and Costs. Sturm. R. Health Affairs. March/April 2002.