Post on 22-Feb-2016
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Health Care Plan Cost Variation by Obesity Classification & Age GroupJoseph W. Thompson, MD, MPHSurgeon General, State of ArkansasDirector, Arkansas Center for Health ImprovementAssociate Professor, University of Arkansas for Medical Sciences
AcademyHealth ARM 2008: Costs & Consequences
of Adult Obesity
June 10, 2008
Who is the CEO of the largest employer-based health insurance plan in your state?
Arkansas Public School Employees / State Employees Health Insurance Plan• Largest state-based insurance plan
(~ 120,000 employees)• Major influence in the state on plan design,
payment structure, network development• Self-insured plan with traditional benefit structure
– no preventive coverage in 2003• Aging work force with chronic illnesses• Escalating health insurance premiums• Lack of risk-management strategies
($1600/yr for smokers)• Decisions based on annual actuarial experience –
no long-term strategy
Arkansas Public School Employees / State Employees Health Insurance PlanCharge to the plan:• Incorporate long-term management strategy for
disease prevention/health promotion Three phases undertaken:
1) Awareness – Health Risk Appraisal (2004)• Tobacco, obesity, physical activity, seat belt use, binge
drinking2) Support – New benefit incorporation (2005)
• first dollar coverage of evidence-based clinical preventive services
• Tobacco cessation – Rx and counseling3) Engagement – Healthy discounts (2006)
Obese32%
Daily Cigarette Users12%
Physically Inactive
21%
No Risks11% O+P
9%
C+P1.5%
C+O2%
C+O+P1%
HRA Respondents Eligible to Incur Claims (N=43,461)
O = ObeseP = Physically
InactiveC = Daily
Cigarette Use
C7%
O20%
P 10%
Self-Reported Risks (2006)
Other Risks39%
Obese$3,679
Daily Cigarette Users$3,081
Physically Inactive$3,643
No Risks$2,382 O+P
$4,158
C+P
$3,257
C+O
$3,529
C+O+P
$4,432
C
$2,690
O
$3,441
P
$3,169
Average Annual Total Cost by Risk Factor
O =ObeseP =Physically
InactiveC =Daily
Cigarette Use
Average Annual Total Costs Linked to Obesity
$1,597$2,441
$785
$1,238
$0
$1,500
$3,000
$4,500
No Risk Obese
PharmacyMedical
Total costs Include medical (inpatient and outpatient) and pharmacy costs for 18-84 year old state employees.
No risk = normal weight, physically active, non-smoker. Obese = BMI≥30.
Total difference$1,297 (54% higher)
Average Annual Total Costs Linked to Obesity compared with Cost for No-Risk Group by Age Group
$0$1,000$2,000$3,000$4,000$5,000$6,000$7,000$8,000$9,000
$10,000
18-24 25-34 35-44 45-54 55-64 65-74
$1,3
82
$1,8
57
$1,9
91
$2,4
09 $3,2
66 $4,3
38
No Risk$1
,230 $2
,160
$2,8
01 $3,7
65
$5,3
91
$8,8
60
Obese
$4,522 (104%)
Total costs include medical (inpatient and outpatient) and pharmacy costs for state employees.
1998
Obesity Trends* Among U.S. AdultsBRFSS, 1990, 1998, 2006
(*BMI 30, or about 30 lbs. overweight for 5’4” person)
2006
1990
No Data <10% 10%–14% 15%–19% 20%–24% 25%–29% ≥30%
Conclusions and Policy Implications• Obesity-related costs increase with age
and represent a major opportunity for cost containment and health improvement
• Costs dramatically increase with age and are differentially higher for those who are obese.
• Cumulative costs stratified by age and obesity classification may inform future actuarial projections for the plan and justify programmatic development.
Implications• Current health care financing constructs prevent
support for early screening, prevention, and treatment– Fragmented child, adult, senior support– Onset of risk in child/adolescent period; cost impact as
adults (maximum for Medicare)– Congressional House Pay-Go rules; Congressional
Budget Office 10-year window for cost-projections
• Without attention and a nationwide strategy to prevent and address precipitating behaviors known to cause disease, the financial viability of the health care financing system, particularly Medicare, is at risk.
Acknowledgements
• ACHI staff and co-authors– Paula Card-Higginson, BA, ELS– Rhonda Jaster, MPH– Jennifer L. Shaw, MAP, MPH, DrPH– Sathiska D. Pinidiya, MEd, MS
• Arkansas Employee Benefits Division