The cost of obesity

by Dr. Peter Lavelle

Obesity costs the country over $50 billion a year, but government efforts at reducing the burden are half-hearted.  A more radical approach is needed, argues a health economist.

Published 09/03/2006

A prime time TV show in which contestants compete to lose weight? Unthinkable a decade ago.

But 'The Biggest Loser' has turned out to be Australia's latest reality TV ratings winner. Fat people aren't freaks - increasingly, they're people like you and me, who want to lose weight.

In 2006, 62 per cent of Australian men and 45 per cent of women were Overweight or Obese - up from 52 and 37 per cent 10 years ago, according to the annual National Health Survey, put out last week by the Australian Bureau of Statistics.*

The numbers have been trending up ever since the 1970s, says the ABS, due to a convergence of factors - the rise of TV viewing, our preference for takeaway, increased work-pressures and pre-prepared foods, the trend towards more sedentary jobs, and fewer opportunities for sport and physical exercise.

The almost two-thirds of men and nearly half of women who are Overweight or Obese pay a huge price - not just in the lack of self esteem, social and work discrimination we hear about from the Biggest Loser contestants, but also in the illnesses that go along with being overweight.  Heart disease, cancer, asthma, diabetes, dementia, arthritis and kidney disease are much more common, and more serious, in people who are Overweight or Obese.

The cost to the economy is enormous. About $2.4 billion a year goes on the direct costs of treating obese and overweight people. The indirect costs - lost work productivity, absenteeism and unemployment - are even higher at about $9 billion a year.

And these costs are going to keep rising because the percentage of people who are overweight or obese will rise. According to the International Obesity Taskforce, by 2025 one in every three adults will be obese if current trends continue.

What are we doing about it?

Australian health authorities first became aware of the problem in the 1970s, but despite a series of reports calling for action, there was little response from governments until 2002, when the state and federal health ministers set up a National Obesity Taskforce, composed of doctors' groups, consumers' associations, retailers, food industry bodies, sporting bodies and others. It was given eight years to come up with intervention strategies (and is due to make initial recommendations to the federal government next month).

In the meantime, individual governments have been implementing their own programs. In 2004 for example, the federal government committed $116 million over four years for programs aimed at families and schools to promote nutrition and physical activities.

And it made changes to Medicare so that from January 2006, GPs can refer people with chronic illness due to obesity to an exercise physiologist and get a Medicare rebate.

No effect

But so far these measures are having no perceptible effect on obesity levels, according to health economist, Paul Gross, from the Institute of Health Economics and Technology Assessment.

He told delegates to the Australian Financial Review Health Congress in Sydney that existing levels of funding are a drop in the ocean compared to what's needed. And existing programs, which rely on educating people to change their behaviour, aren't working because they don't provide enough incentives.

There's too much reliance on health workers to treat the problem, especially GPs, who aren't given additional resources to manage obesity outside a typical doctor's consultation.

He says the work of the National Obesity Taskforce has been disappointing - there's been a lack of a common vision from participants and long delays in reporting to the government.

Such is the magnitude of the problem that state and federal governments have consigned the problem of Obesity to the 'too hard' basket, and the measures they're advocating are stop-gap measures, designed to paper over the problem.

Financial incentives?

Gross's solution is more radical. He calls for changes to Medicare, private health insurance, and workplace and tax legislation to give people financial incentives to change their behaviour. Obesity shouldn't just be treated by governments as a public health problem but also as a barrier to productivity and a drain on resources. He says governments should consider:

• Giving employers financial incentives to offer nutrition and weight loss programs to employees, in exchange for a cut in the corporate tax rate;

• Allowing private health funds to give subsides or discounted premiums to members who enrol in such programs and maintain their weight loss (measures not allowed at present under the community rating system);

• Pharmaceutical Benefits Scheme (PBS) subsidies for selected weight loss drugs for people who are seriously obese, where considered appropriate by their doctors;

• Medicare rebates for accredited weight loss programs.

Gross is calling for a new body, a National Council on Obesity and Chronic Disease, to oversee a properly funded, targeted national policy, reporting directly to federal Cabinet.

There are additional costs to be borne by the government in all of this, but the savings would more than cover them. For every dollar invested, Gross argues, the government would save six dollars in Increased Productivity, reduced Absenteeism/Presenteeism and reduced drain on the health care dollar.

It's all spoken like a true economist, rather than a health worker or a public health policy-maker who has to work within the existing health system. On the other hand, the ABS figures show the problem is getting worse, not better - so something more radical may need to be tried, or one day we may all be contestants on the Biggest Loser.

*Obesity is defined as a Body Mass Index (BMI) greater than 30, and being Overweight as a BMI greater than 25.  BMI is weight in kilograms divided by height in metres squared.