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What is the Cost/Value of a Calorie?

We spend more for healthcare per person than any other country. By a significant amount.


Chart: Yuasan, Wikimedia Commons

Some of this extra cost is in better healthcare facilities, more personnel, higher pay that attracts better caregivers, and other things. These increase costs, but not by much. The biggest chunk, 50-70% of our total healthcare costs, is that we are unhealthy. We require more healthcare to keep us going than people elsewhere do. Too many calories go in and too few get burned up.

Obesity rates 2015




What is the cost of one of these calories? In terms of healthcare about 4 to 6 cents depending on how tall you are. That’s per year. For the rest of your life.

Eating an extra 200 calorie dessert above what we should will cost about $8 to $11 in additional healthcare for each year of the rest of our life. An extra 200 calories each day for a year will cost about $3,100 per year more in additional healthcare.


These samples are between 90 and 140 calories each. Eating one will cost between $2.73 and $4.24 per year in additional healthcare—each year for the rest of our life.

How Do We Get Here? Some Very Quick Math.

We spend about $11,000 per year per person for healthcare in the U.S. Costs vary considerably per person though, mostly based on lifestyle choices.

A group of a thousand people of healthy weight averages about $4,500 per person per year. Many of these will cost less than $1,000 per year but some will have extra health issues like cancer or broken bones and cost more but when it’s all tallied the average is about $4,500.

A group of overweight people will cost about $9,800 per year per person.

A group of obese people will cost about $17,600 per person per year. Similar to above, some will cost less and others will cost more but as a group they’ll average about $17k. By the way, the calculations include that they live fewer years than healthier people.

These extra costs due to weight and inactivity include increased incidences of diabetes, joint repair and replacement, cancer, heart disease, strokes, and a number of other medical problems. There are also often higher costs, per treatment, to treat people who are overweight. Then there are numerous secondary and tertiary problems such as those resulting from sleep apnea caused by being overweight.

From this and BMI tables we can get a cost per pound of extra weight we carry which ranges from about $140 to $210 per extra pound per person per year. Extra calories cost less the taller someone is. A person who is 5’10” has a per calorie cost of about $150 while someone who is 5’4” is $190.

And knowing that consuming 3500 calories adds 1 pound of weight we can get our $0.04 to $0.06 cost per calorie consumed.

Note: While the math is rather straight forward, it’s important to note that the numbers we started with, healthcare costs for groups of healthy, overweight and obese, are still somewhat uncertain. Some give a wider range than above and some narrower. I’ve used numbers that I believe are slightly on the conservative narrower side. There is considerable room for refinement but I think we’re at least in the ballpark and I’d be quite surprised if this is off by much. It’s also important to note that while being overweight or obese are health issues in themselves they are perhaps more important in being indicative of other underlying health problems, primarily too little activity.

It should also be noted that weight is not exclusive in the poor lifestyle choices sweepstakes. There are people of a healthy weight but who smoke, do not get enough activity, drink too much or do drugs who are unhealthy and as a group will also cost more than average. 

The Value Of A Calorie

An extra calorie consumed has a cost but on the flip side an extra calorie burned has value!

If we ride our upright bicycle 2 miles to lunch, 1 mile to the grocery and then 2 miles back home we’ll have burned about 225 calories which based on our calculations above has a value of about $9.75 in reduced healthcare costs.

However, activity itself has considerable health value. It’s much better to consume 200 extra calories and then burn 200 extra calories with activity than to sit on the sofa neither consuming nor burning. So, a calorie burned has more value than the cost of a calorie consumed. How much is a big guess and guesstimates range from 10% to 400%. For now perhaps we’ll just stick with ‘more’.

Medical folk I’ve talked to are quick to say that they’d never say this to a patient though, for fear that we would too often consume the extra calories without actually burning the extra calories. Nah. 🙂 But burn 225 calories riding to a local pub for a 225 calorie beer? You Betcha.

A Young Calorie vs Old Calorie

Carrying 10 pounds of extra weight is about $1,700 per year in increased healthcare costs. If we carry those 10 pounds for 15 years before we die then we’ll cost about $25,000 in extra healthcare. However, if we begin carrying those pounds when we’re 10 years old and live to 65 then that’s an extra $93,000 healthcare expense burden we’ll have created.

It works in reverse as well. A calorie burned at a young age will end up being worth more than one burned at an older age. This does not in any way negate the value of burning a calorie when we’re 60 years old though.

What then is the value of encouraging children to walk or ride bicycles to school every day? And then encouraging them to continue this healthy lifestyle in to adulthood?

A Calorie Is Not Always A Calorie

500 calories from leaves, legumes and grains is better than 500 calories from a Big Mac or a donut with sprinkles.

Boterham met hagelslag en fruit

Dutch Hagelslag. Perfect diet is not critical. The Dutch are the only developed country in recent decades to have measurably reduced their overweight and obesity rates that are less than 1/3 our rates today and are expected to be less than 1/4 by 2020. They’re far from perfect eaters though. Hagelslag (chocolate sprinkles) is a favorite breakfast item. Bitterballen, Stroopwaffles, Poffertjes, and french fries dipped in mayonnaise are also quite popular. They eat them in small portions and get enough daily activity to afford these treats though. Photo:

A recent calorie also appears different from a past calorie. One calorie of activity will burn one recently consumed calorie. However, we’re learning that once a calorie has settled in and become comfortable then it may take as much as two calories of activity to dislodge it later on.

Walking or riding to breakfast, lunch or dinner will satiate us so we’ll eat less and returning afterwards will be the most efficient in burning what we’ve consumed.

What can we do with this information? Do bikeway networks that allow us to ride bicycles for active transportation have value? Do road designs that actively discourage walking and bicycling have costs? Can we really reduce healthcare costs by increasing our activity and living a healthier lifestyle?

Walker Angell

About Walker Angell

Walker Angell is a writer who focuses mostly on social and cultural comparisons of the U.S. and Europe. He occasionally blogs at, a blog focused on everyday bicycling and local infrastructure for people who don’t have a chamois in their shorts. And on twitter @LocalMileMN

54 thoughts on “What is the Cost/Value of a Calorie?

  1. Andrea Kiepe

    Finally, some open fat shaming! Why on earth you all would print this garbage is beyond me. It is as if the last 30 years of feminist writing and research on weight never occurred.

    1. Bill LindekeBill Lindeke

      Hi Andrea. I think Walker’s trying to simply write about public health and obesity in terms he finds useful. He’s trying to make a case that the public should invest in active transportation infrastructure.

      To that end, I’d appreciate if you laid out more clearly what you find problematic here. I think I might get what you mean — I’m guessing you are concerned about disconnects around perceptions of health and weight, or some of the powerful social factors that affect health or obesity, or a certain kind of moralistic language — but I’d imagine that others don’t. How would you suggest talking about obesity and public health?


      1. Rosa

        maybe just not, if you don’t have the people you’re talking about represented among your authors?

        I just got an invite to some of your events that says everyone is welcome but as a fat woman (and a multi-decade Twin Cities cyclist) I’m pretty much never, ever, ever going to come. This kind of stuff comes up here way too often.

        1. Walker AngellWalker Angell Post author

          Rosa, there is a vast difference in an attribute like being overweight or obese and who someone is.

          One of my favorite people is my sister-in-law Kris. I enjoy talking to her and doing things with her. Kris is also obese. Her obesity concerns my wife (her sister) and I because we know (my wife has spent years of her career studying healthcare research) that her obesity is causing increasing life-altering health problems for her and will shorten her life. Her obesity has no affect on what we think about her though. She is the same wonderful person whether obese or thin.

          I can say similar for numerous friends who are obese. I am concerned about the affect their being overweight or obese has on their health but it has no affect on our friendship or what I think of them as a person.

          Finally, you have been one of my favorite commenters on You have added a wealth of perspective to everyone who reads this blog. Please do not ever feel that you are not welcomed on the blog or at events.

          1. Walker AngellWalker Angell Post author

            Just to add one more bit, not sure if this makes a difference or not. The 3rd part of this series (originally 1 post but kept getting longer so divided in to 3 parts) looks at how much more difficult it is to life a healthy lifestyle in the U.S. than in Europe.

          2. Rosa

            That entire last comment is incredibly offensive, right down to saying things that make me feel unwelcome and telling me I should not feel unwelcome. You want me to feel welcome, welcome me, don’t tell me you have fat friends and you are worried about their (my) health. You don’t know anything about my health or my acitivity level by looking at how fat I am.

    2. Anon

      This article is not garbage; it is a well-thought out economic argument that links obesity/overweightness to urbanism and discusses the costs of our choices. Our poor diets, over-consumption and lack of physical activity are killing us, expensively. Dismissing settled science because it is incongruent with an ideology has a tragic cost in human life; we see/saw this with lead, climate-change, anti-vaxers and now ‘fat shaming’. Obesity-related illnesses such as cancer, heart disease, strokes, stroke and diabetes are unaware of the last 30 years of feminist writing, and remain undeterred by comments on the internet.

    3. Sean Hayford OlearySean Hayford Oleary

      The picture with the samples with the customers in the background is potentially distasteful, but I am not sure it was even deliberate for them to be included in the picture.

      I am also curious what your concern about the article is otherwise. Although it discusses difficult realities about overweight and obesity, I don’t think it is really attacking fat people.

      I would also be curious how rigorous/valid trying to quantify a sugary sample as adding $4/yr in healthcare costs for life is.

      1. Walker AngellWalker Angell Post author

        “I would also be curious how rigorous/valid trying to quantify a sugary sample as adding $4/yr in healthcare costs for life is.”

        On an individual basis it’s tough because there are so many other factors that play in to it. You may be able to tolerate more extra weight than I for instance. There are myriad examples of people who appeared the paragon of health and healthy lifestyle having a heart attack @ 50 while there are others who live an unhealthy lifestyle, are obese and smoke who live to 70 with few apparent ailments.

        In a population of 10 people it will begin to prove out and in a population of 80,000 employees it does quite starkly.

        One of the more interesting studies on this was of employees of Quality Bicycle Products in Bloomington MN. Even with their very small employee population there were some significant differences beginning to show.

    4. Christa MChris Moseng

      I believe this comment is a good reminder that articles like this should either be written by or get a read from people who have an ear for common ramifications of the subject matter. It may not sound to the author or to me that a particular line of reasoning or turn of phrase is insensitive or unreasonable, but someone with experience with the subject matter might be able to quickly provide editorial guidance to avoid stepping in it out of ignorance.

      I agree with Adam that there are some generalizations in here that make me uncomfortable. Maybe the biggest one is the premise that economic reasoning for health decisions is either material or persuasive on an individual level—let alone whether the reductive approach explored here is scientifically valid. I don’t think people who may be classified as obese by BMI (a twice-flawed metric) lack information signaling that one’s body weight is a matter of concern, and after a certain point adding more supporting data to the argument can be read as hostile or moralizing.

      I’m not saying I have any answers for how to write compassionately about public health vis a vis active lifestyles’ connection to body weight, but maybe it’s reasonable to leave the last connection out of it without more rigor and care behind the discussion.

      1. Walker AngellWalker Angell Post author

        Chris & Andrea, can you give some specific examples of things that you would have written differently or things that you found offensive.

        The purpose of this article is as a foundation for future articles on how the designs of our cities and roads impact our health and healthcare costs. The extent to which dangerous road designs make healthy lifestyle choices difficult for instance. Those discussions can’t happen without the discussion above.

        I think we have to be extremely careful of the extent to which we stifle discussion in order to not hurt people’s feelings.

        1. Christa MChris Moseng

          To start with a general observation, an author should consider who their audience is when writing something. If you’re not concerned with your audience’s feelings when they read what you’re writing, you might want to reflect on whether you’re accomplishing your goals for writing the thing in the first place. Considering your audience’s feelings or reactions isn’t “stifling,” it’s “effective communication.”

          Specific things I would have written differently or omitted:

          The step where you converted from pounds to dollars using BMI. BMI is a rough screening tool that elides so many salient details about individual physiology and health that this step facilitates false precision in a way that is guaranteed to be inaccurate on an individual basis. So you’ve done a lot of work to come up with a falsely precise figure and then use it for even more calculations.

          You also use correlation to imply causation. You take the correlation between body weight and health care costs, and apparently conclude that the body weight causes the variation in healthcare costs. But they could both have some other, common cause, or the correlation could be a coincidence. Even if, by some happenstance, the correlation IS a causal connection, the way it is written doesn’t seem to even acknowledge the logical leap. This undermines the whole piece.

          Talking about the connection between obesity, active lifestyles, and healthcare costs at a societal level is safer territory. Yet your first main paragraph contains two or three amazing leaps and generalizations, so I don’t think you even stuck that landing. “Some” of the US’s comparatively exorbitant healthcare spending is related to facts about our broken market-based system, and 50-70% are because we’re unhealthy, and primarily because we’re fat? You didn’t prove this at all, or provide support for your argument. Even if it is true (I’m incredibly skeptical), it’s just a dizzying chain of logic ending in a conclusory thesis statement that purportedly justifies the entire rest of the piece.

          This undermines everything else the article attempts to do.

          Then, trying to reduce the economic and BMI data to individuals and their daily caloric intake inevitably will be quite wrong despite being dressed in the clothes of scientific/economic rigor. I’d want substantially more rigorous analysis and awareness of the limits of precision to use the data in this way before I ever said anything along these lines.

          I am normally not so critical and demanding of detail and rigor in volunteer-written blog posts, and I think that’s ordinarily a fair approach to take. But some subjects are more challenging and writing on the subject matter ought to be held to a higher standard. This is probably one of them.

      2. Anon

        Concern about being insensitive or causing offense is literally killing people. It is wrong to infantilize the overweight and obese with some censorious editorial process that prioritizes feelings over health. People deserve accurate information, even if it is hard to hear. The way to write compassionately about this public health issue is to tell people the truth; nobody likes to have their feelings hurt, but hurt feelings are better than cancer, strokes, diabetes and heart disease.

        Everyone knows BMI is imperfect, but we don’t have an epidemic of people using BMI to misidentify themselves as overweight. Anorexia disorders are rare, at 0.6% of the population whereas over nutrition impacts 70% of adult Americans. Furthermore, at least half of the overweight or obese people do not realize that they are obese! The most common body-image issue (by a factor of 50x) is overweight people thinking that they are at a healthy weight.

        1. Adam MillerAdam Miller

          It’s not, Anon. Literally no fat person does not know about their weight or your judgement about it. No one is fat but for someone telling them not to be.

          1. Anon

            Some published peer-reviewed studies that show that a majority of overweight and obese people are unaware of their condition. One study that claims that 90% of obese people don’t know that they are obese. But I also found conflicting studies. I can sort of believe this; when I was told by my doctor to lose some pounds, I was sort of shocked and honestly a bit hurt, because I thought I was at a perfect weight. A consumer reports poll found that 90% of Americans think their diet is “somewhat healthy” or better. I recall (truthfully) telling my doctor how my meals are high-quality food in prudent amounts, yet omitting my love affair with a nearby vending machine. People with higher BMI are more likely to underestimate their caloric intake, and their estimates are less accurate also.

            In addition to constantly nudging us to make poor health choices, our society also normalizes overweightness, clouding our self-perception. Especially dangerous, is the crusade against the word obesity, as that condition carries much greater risks than just being overweight. We need constant reminders that we are overweight and that it is unhealthy to be overweight. Otherwise, we compare ourselves to our (overweight) peers and carry on as usual.

        2. Christa MChris Moseng

          I think if you talked with some actual people involved in healthcare, I suspect they’d disagree with you that “toughen up fatso I’ve got some stuff you need to hear” is an effective way to improve individual health outcomes.

          This notion that heavier people are ignorant of their weight, or of what society thinks about them, is preposterous. You’re living in a fantasy world.

  2. Adam MillerAdam Miller

    Yeah, I’m not super comfortable with this analysis either. To begin with, the underlying premise – that more exercise is an effective way to combat obesity – is certainly an over-simplification. I’m no expert, but my understanding is that what little we know about nutrition science says that what we eat, our genetic makeup and the flora that live in our gut (influenced also by what we eat) may have much more to do with obesity than inactivity.

    Also, trying to put a dollar expense on a person’s body is going to rub people the wrong way.

    1. Anon

      But we *do* know what causes obesity: extended periods where caloric intake exceeds caloric expense. The caloric input side of the equation is more important, but exercise matters too. Genetics, gut bacteria, matter too but much less so. Yes, the topic makes people uncomfortable, and even doctors avoid the subject with their patients, which makes human toll even greater.

      Claiming that the science is unsettled is a classic denier argument. Just because we don’t know everything about global warming does not mean that there is not a scientific consensus or that the threat is not real. On average, a few hundred people have died of obesity related illnesses since this article was published a few hours ago. If economic arguments can change behavior then we should make them, even if they cause discomfort. The discomfort you feel discussing this issue is far less than the discomfort felt by the tens of thousands of people who have lost limbs due to diabetes.

      1. Adam MillerAdam Miller

        “But we *do* know what causes obesity: extended periods where caloric intake exceeds caloric expense.”

        Again, I do not think we know that, in that there is an underlying assumption that obesity could have been avoided by just consuming fewer calories or expending more. My limited understanding of the science is that we actually know that is not, on its own, true.

        No one is denying that obesity is a problem. The questions are around the causes and therefor solutions.

        1. Anon

          Here is CDC’s page on Adult Obesity Causes & Consequences

          The cause of obesity is eating more than our bodies require. If you eat less then you require, then you will lose weight, otherwise your body would be violating the first law of thermodynamics, specifically conservation of energy.

          I agree that there is much work to be done on *why* we choose to eat more than we require, and certainly obesity an issue with a disproportionate impacts across race and class. The solution is to get people to Eat Less and Move More. That simple solution is so distasteful that it nurtures a diet industry selling quackery and self-delusion. Figuring out how to restructure our society so that we all EL&MM is not simple, but a good start would be acknowledging that overeating causes obesity and that there is no magical unique biological factor that makes Americans more susceptible to obesity.

          When we look at societies without a crippling obesity epidemic, their healthy weights are not a product of a better diet pill or some cutting edge biotechnology, instead we see that healthier societies Eat Less and Move More.

          1. Adam MillerAdam Miller

            Okay, but European levels of caloric consumption are barely below ours (see, e.g. and surely some of those countries are among the societies you seek to emulate.

            Which is consistent with mounting evidence that it matters just as much or more what you eat, not just how many calories. I’m fairly confident that Americans eat vastly more processed foods, grains and sugar, even if daily caloric intake is only marginally different from Austria, Belgium, etc.

            1. Walker AngellWalker Angell Post author

              Two identical people, both with a metabolic burn rate of 2,000 calories can both consume identical 2,500 calories per day and one will gain weight and the other will not. The former drives everywhere in a car and tries to park as close as possible to wherever they are going. The latter walks or rides their bicycle to work, eat, shop and for other errands and so burns 500 more calories per day. ??

              1. Adam MillerAdam Miller

                That may be true if they ate the same things but it’s not true that society can exercise its way out of obesity. We’ve got to fix what we eat too, and perhaps even primarily.

                But regardless of weight, exercise is associated directly with all kinds of health benefits too.

            2. Anon

              This data is food supply, not consumption, use it with care.

              Using the chart the data on the site you mentioned, see Section II.1 Prevalence of obesity versus daily supply of calories. I downloaded the data and I see a .75 correlation between obese or overweight adult men, and daily supply of calories. (95% CI is .69 to .80) for the latest year available. [insert usual disclaimers that correlation != correlation]. The calorie consumption delta may only be around 250/day in the US vs. EU, however that is enough to gain 25 lbs a year.

              The present scientific consensus is that food quality is important, but less important than food quantity.

              calDF <- read.csv("cal.csv")

              #only use latest year
              calDF <- calDF[calDF$Year==2013,]

              # Remove unused columns
              calDF <- calDF[, -c(1,2,3,6)]

              # clean up column names
              colnames(calDF) <- c("cals", "percentOverweight")

              cor(calDF$cals, calDF$percentOverweight, use="complete.obs")

              #confidence intevals keep us honest
              CIr(cor(calDF$cals, calDF$percentOverweight, use="complete.obs"), n=nrow(calDF), level = .95)

    2. Walker AngellWalker Angell Post author

      Perhaps, but empirical evidence rather consistently says otherwise. Generally, and fairly consistently, the more physically active a population is, particularly active transportation, the less obesity they have (and often the less chronic disease as well). I’ve never known of anyone who wanted to loose weight and keep it off who was not able to do so through increased activity and fewer calories consumed*. Every medical and nutrition person I talked with about this stated that it really is very simple calories consumed – calories burned = weight gain/loss. In his multi years of Blue Zones research Dan Buettner has seen consistently that the healthiest people across the globe are those who are not overweight, who have an active lifestyle and who consume an appropriate amount of calories. TV shows such as Biggest Looser are, I believe, based on increasing activity and decreasing caloric intake to help people achieve lower weight and a healthier self. If you starve someone (significantly reduce their caloric intake), in a concentration/prison camp, by mis-managing a population’s resources or because of climate induced food shortages then they will loose a substantial amount of weight.

      *Easier said than done and, for a variety of reasons, easier for some than for others. More in part III but in short, it is more difficult for the vast majority of people to live a healthy lifestyle in the U.S. than in many or most other countries.

        1. Walker AngellWalker Angell Post author

          That was an interesting study but has a rather huge flaw in that the data is not a representative sample of any country’s population. They used data from the Azumio apps which is a good collection of apps but are only used by a tiny minority of populations and those who use the app are a select group.

          That said, there is indeed activity inequality and that is the topic of an upcoming post.

  3. David MarkleDavid Markle

    Unfortunately getting rid of a fat cell–an elastic module–once formed, takes a long time: something not accomplished by means of a short-term diet/exercise routine.

    A further step in the article’s argument: analyze the specific differences in life style between the USA norm and that of the low obesity countries. But at this point one thing is quite clear: obesity is unhealthy.

    As to comparing dollar cost of healthcare between countries: it involves much more than obesity.

    1. Walker AngellWalker Angell Post author

      Yep, comparing country to country is difficult. The reports that do so are long and tedious even for data loving me.

      What can be done is compare outcome for outcome and procedure for procedure. This simplifies things a little, eliminates problems of what/who is or is not covered where and makes comparisons a bit easier. The U.S. actually looks quite good on these and to the extent that you can do a cost per successful outcome we’re borderline outstanding.

      One problem is that a patient who goes in to a procedure having lived a healthy active life is likely, all else being equal, to have a better outcome than someone who is less healthy. Medical folk know this at a local level but its difficult to quantify in a larger population.

  4. Ryan

    The first two charts don’t seem to support the claim made by the article that obesity is the main driver of US healthcare costs. Yes, the US is the highest on both lists, but the correlation is far messier after that. Switzerland and Norway have the #2 and #3 highest healthcare costs but are near the bottom of the list on obesity. Conversely, Mexico and Turkey have the lowest healthcare costs but are both above average on obesity. New Zealand also has above-average obesity and below-average healthcare spending. The best recent meta-analysis I can find[1] concludes that obesity/overweight contributes 5-10% of overall healthcare costs – Substantial, to be sure, but perhaps not our best first target if we want to control healthcare spending.

    I’m similarly dubious about the author’s attempt to quantify the cost “of a calorie” to an individual, or even really why this helps the argument at all – why not just make the case that we as a society would be healthier with more biking and walking in aggregate? All of the policy prescriptions (which I agree with!) are big-picture stuff, I don’t think it really helps the case to scold me about the $19.20 supposedly added to my future healthcare costs by this delicious slice of pizza. Recent meta-analysis of the direct medical costs to obese individuals are also much smaller than what is printed here[2]

    The image in the article also (I think inadvertently) uses the “Headless Fatty” trope, which dehumanizes the human beings at the center of this debate[3].

    I think it’s unfortunate, because I really like the policies Walker advocates – we need streets that encourage safe, comfortable biking and walking! Public health is among the reasons to do that! But I think that this particular form of the argument is not particularly sound.


    1. Walker AngellWalker Angell Post author

      This is why I included the long note that these numbers are quite uncertain. Perhaps the strongest two numbers we have are the approx $11,000 per person per year (in 2017 constant dollars) in necessary (e.g., doesn’t include vanity plastic surgery, etc.) medical spend and the $4,500 per person per year for people of a healthy weight. Even these have issues though.

      Beyond those two numbers, two major problems in researching this are accounting for accurate drug costs and capturing accurate data for people across broad populations. The broad population part runs in to two problems; uninsured (since nearly all data come from insurance companies and self-insured corporations) whose costs often get lumped in to general overhead areas and, interestingly, people who are retired and often not included in data sets as actively insured.

      The drug costs part is primarily around Type II Diabetes. These drugs appear, by a factor of about 10, more expensive in the U.S. than elsewhere. Numerous studies then use a lowest-cost-available method to adjust the U.S. numbers on the presumption that the U.S. costs for them are hugely over-inflated. Several problems with this is that this then doesn’t account for some major government subsidies of these drugs nor of cross subsidies. Realistically according to drug makers these drugs will run about $19,000 per person per year IIRC. They may appear on the market in Country A for $2,300 PPPY which has a known government subsidy of perhaps $3,200 PPPY so a perceived cost of $5,500 PPPY. But then there is another, often larger, government subsidy behind this which is really a bit of a cross subsidy as it’s part of a drug package. And finally at the drug company who needs to average $19,000 PPPY you’ll see them sold for $21,000 PPPY in the U.S. to subsidize a lower sale price of $13,000 PPPY to Countries, A, B, etc.

      More to come…

      1. Anon

        I looked at Ryan’s first citation which is a meta-analysis of papers between 1992 and 2008 and finds a cost of 118B attributable to obesity. At 2.4T National Health Expenditure in 2009, this is around 6.2 %. More current estimates range between 147B and 210B which on our current 4.3Trillion NHE is less than 5%. (Back-of-napkin-calculation assuming 210B expenditure and 230million over-nourished people yields incremental costs of $910/year). These numbers are almost an order of magnitude away from your incremental costs of obesity. Can you provide a source for the health-care costs of $4,500, $9,800 and $17,000 per year for healthy, overweight and obese people? Thank you.

        1. Walker AngellWalker Angell Post author

          Apologies for the late reply. I’ve been, surprisingly in the heart of Europe, without well functioning internet for the past 9 days.

          I’ll see what I can do to find something publicly available.

  5. Monte Castleman

    I’d disagree with the basic premise that basically the only reason healthcare cost so much because we’re fat. Countries with lower healthcare cost might have lower obesity rates, but correlation doesn’t imply causation, at least not to the extent purported. The UK has 70% of the obesity rate as the U.S but 50% of the healthcare expenses.

    Insurance company overhead (limited by law to 20% and in reality a national average of just over 10%) or torts (a few percent) despite being called out aren’t the main problems either. We have

    1) The cost of educating doctors, which is in turn driven by the cost of college, which is in turn driven by more competition for a fixed supply of openings and easy loans, now that working at Ford is no longer an option it’s go to college and learn programming or flip burgers for the rest of your life, and you can even borrow a bunch of money to do it.

    2) Americans demand for all the care they want, when they want it.

    3) America bearing the burden of pharmaceutical drug development for the rest of the world.

    4) Having to supply services to a much more spread out population base.

      1. Anon

        About half of the health insurance market is non-profits. Health insurance is not a particularly profitable industry. Slightly more than half of the hospitals in the US are non-for-profit. It is hard to blame profits (in the corporate sense) for our healthcare dilemma. Healthcare is a complex situation with no simple solutions, perhaps even no good solutions. I agree with ‘Bad Incentives’. There are countless complex situations where patients and doctors lack the incentives to make sound medical and economic decisions.

        1. Bill LindekeBill Lindeke

          Non-profits still have a “profit” motive in the sense of an incentive to grow and capture more of the health spending “market”, which is why you see so many non-profit hospitals and insurance companies in Minnesota spending a lot of money on advertising, unnecessary hospital expansions, amenities intended to appeal to “health consumers”, etc. These administrators still get paid a lot of money.

      2. Walker AngellWalker Angell Post author

        I agree about waste, bad incentives and bureaucratic overhead. OTOH, the US is usually ranked at the top of all countries based on successful outcomes and on outcome per dollar. We’ve got problems but I don’t think we’re any worse than others and likely better than all of most.

        I sometimes wonder if one of our biggest problems, aside from lack of activity and too many Big Macs, may be that we have too much insurance? Most people, the 92% of our population who are fully insured, have little to no idea how much their own healthcare costs. There are no financial incentives for people to make healthy lifestyle decisions or choose appropriate medical tests. Medical folk, for fear of lawsuits, prescribe just about any and every test they can think of to make sure that they’re not accused of not getting someone tested. After all, they’re all covered by insurance.

        I wonder how much different things would be if insurance covered only 80% and individuals had to pay for 20% out of pocket for each and every bit. This shouldn’t increase our costs since the costs for insurance will go down if it only covers 80% instead of 98% or 100%. But costs should, theoretically, go down even further if we all became conscientious healthcare consumers instead of near mindless bots within the system. BTW, some medical and insurance folks whom I have a good deal of respect for disagree with me on this. Co-pays have not proven much of an incentive because they account for so little for most people.

      1. Walker AngellWalker Angell Post author

        We do have somewhat high and higher than OECD average pay scales though healthcare workers here earn less than those in Switzerland and some other countries. OTOH, the UK is struggling to find healthcare workers because nobody wants to practice there due to the low pay.

      2. Anon

        Medical Doctors in the Netherlands get paid significantly more than doctors in the US, but their per-capita health expenditure is about half of ours. Ditto for Australia.

      3. Monte Castleman

        It’s true that physicians, particularly specialists, make more money than in other countries, but that’s partially offset by the cost of malpractice insurance and the cost of education. My stepsister is now a vet, but graduated with $100,000 in student loans and no house for herself and her new husband to live in.

    1. Walker AngellWalker Angell Post author

      You are correct that there is little correlation, country to country, between activity, overall health and spending on healthcare. Switzerland for instance has a very high per capita healthcare spend even though they are a quite active and healthy population. Healthcare workers there earn significantly more than those in any other OECD country. I believe they also have a much higher healthcare workers per capita ratio. Internally their population is also very critical of the inefficiencies in their system. At the same time they’ll say that the care is the best in the world. Reality is that in most outcomes based analyses they are in about 5th place.

      This article isn’t about country comparisons though but about our own U.S. system. Our costs due to obesity, overweight and low activity come primarily from self-insured corporations and the insurance industry who have pretty good data across broad populations and the numbers I used are what they are seeing across these populations. People who are active and not overweight do not use less expensive medical folk than people who are obese. They don’t generally go to less expensive facilities. The difference is that they have fewer health related problems and so require fewer medical procedures and drugs.

      1. Anon

        @Walker, can you provide a source for the annual health care expenditures of obese and overweight people?

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