Obesity Comes With a Price Tag
There are hard dollars-and-cents costs to being overweight or obese,
according to Humana (NYSE: HUM), one of the nation’s largest health
benefits companies.
Specifically, Humana estimates these costs at the following for 2009:
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$19.39 in added health care costs for every overweight pound;
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$1,037.64 for every overweight individual;
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$127 billion added to the national health care bill.
Overweight people are more prone to heart disease, stroke, diabetes —
even some kinds of cancers. Chronic diseases that are a result of
weighing too much are an ever-increasing part of America’s health care
bill.
Carol McCall — a research actuary at Humana — culled through national
health care data and the data from Humana’s members, and here is what
she found.
Like butter and sugar, obesity has a cost per pound
On average, the annual per-pound cost of being overweight — that is, the
added cost per added pound of the overweight and the obese — is $19.39.
The cost increases with age.
For 25-year-olds, it averages $10.25 for every overweight pound. By age
64, it increases to $26.32. (On average, overweight people are 29 pounds
overweight; the obese are 82 pounds overweight.)
For someone age 25, the added annual health care cost is $209 for the
overweight and $960 for the obese. By age 64, this grows to $610 extra
for the overweight and $2,300 for the obese.
Why this impacts the national healthcare crisis
There are more than 122 million overweight and obese Americans between
the ages of 20 and 65. On average, their additional health care costs
are $534 per year for an overweight person and $1,614 for an obese
person. Those costs add up to a $127 billion crisis. The increase in
obesity prevalence – going from 23 percent to 33 percent between 1994
and 2004 – added $34 billion to the annual health care bill.
A person who is 25 and obese today, and remains obese until they’re 65,
will average $179,000 more in health care costs (in 2009 dollars,
assuming health care inflation of 4 percent a year) over those 40 years.
A new way to look at and to count calories
Maintaining all of those extra pounds requires Americans to take in 23
trillion calories a year. That’s the equivalent of 46 billion Big Macs,
114 billion Krispy Kreme donuts or 152 billion bags of chips.
These calories have the same energy as the following:
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10 1,000-megawatt power stations generating for a year
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788 million gallons of gasoline
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10 million tons of coal
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96 trillion AA alkaline batteries
There is a way to get out of this national problem
The good news is that Humana’s data also indicates that just a small
change – a reduction of 276 calories a day for the overweight – makes a
big difference. Cutting that little from each day’s intake would start
moving millions of Americans from the category of overweight to healthy.
That means people don’t have to re-engineer their lives to get on a
healthier path. Incremental change — giving up one soft drink and
walking an extra 2,500 steps each day, for example — will do the job.
"If obesity were eliminated, or even significantly reduced,” says
McCall, "the money saved would be significant. It could pay for food for
the poor, health insurance for the uninsured or millions of college
educations every year.”
Dr. Jonathan Lord, Humana’s Chief Innovation Officer — who oversees
Humana’s efforts to reduce health care costs by engaging people in
healthy behaviors — put it this way: "In this time of financial crisis,
it’s now clear that Americans can improve the economy as well as their
own health prospects by giving up a few pounds.”
"Riding a bike and taking a walk in the park burn calories,” Dr. Lord
says, "but those activities are also fun. Life is so hectic and we are
so dependent on cars that many of us have forgotten that.”
Humana’s Innovation Center is full of teams trying to find new ways to
engage people in their health. The company believes that the key to
success is to meet people where they are: at school, playing video
games, on cell phones, walking or riding bikes in the park.
Humana, for example, created the Freewheelin bike-sharing program, which
debuted at the Democratic and Republican national conventions last
summer. In less than two weeks, 7,523 rides were taken, 42,000 miles
were ridden, 1.3 million calories were burned – and participants who
hadn’t been on a bike in years raved about the experience. Now, Humana
is partnering in B-cycle, a new company it created to sell bike-sharing
programs to cities and universities.
Humana also is partnering in Sensei, a cell phone application to support
people in making better nutritional choices and in physical activity.
And the company has also pioneered several very successful pedometer
programs in England and in this country.
About Humana
Humana Inc., headquartered in Louisville, Ky., is one of the nation’s
largest publicly traded health and supplemental benefits companies, with
approximately 11.7 million medical members. Humana is a full-service
benefits solutions company, offering a wide array of health and
supplementary benefit plans for employer groups, government programs and
individuals.
Over its 47-year history, Humana has consistently seized opportunities
to meet changing customer needs. Today, the company is a leader in
consumer engagement, providing guidance that leads to lower costs and a
better health plan experience throughout its diversified customer
portfolio.
More information regarding Humana is available to investors via the
Investor Relations page of the company’s Web site at http://www.humana.com,
including copies of:
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Annual reports to stockholders
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Securities and Exchange Commission filings
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Most recent investor conference presentations
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Quarterly earnings news releases
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Replays of most recent earnings release conference calls
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Calendar of events (includes upcoming earnings conference call dates
and times, as well as planned interaction with research analysts and
institutional investors)
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Corporate Governance Information
