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By Matthew Rees

Food and Health Fact #156: Why are health insurers MIA on obesity prevention?

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In discussions about America’s rising obesity rate over the past 40 years, the role of one major health-care player is usually glossed over: health insurance companies. It’s a curious omission, given what should be a strong financial interest in healthy weight management. The absence of insurers from the discussion – and their broader failure to involve themselves in obesity prevention – crystallizes some of what’s deeply flawed in the U.S. health care system.

Pinning down total annual medical costs associated with obesity is challenging, but a 2020 report from the Milken Institute put the direct costs at $370 billion and indirect costs an addition $1 trillion. Data from more than a decade ago showed that per capita annual medical expenditures of adults with Class I obesity (BMI ≥ 30-34.9) were about roughly $1,220 higher than those with a healthy weight (BMI 18.5 to 24.9). Among adults with Class II/III obesity (BMI 35-39.9 and exceeding 40, respectively), the gap is $2,640 in per capita annual costs. Among those 65 and older, the figures are about $2,070 for Class I obesity and $4,335 for Class II/III obesity.

Leaving aside health concerns, those figures should worry health insurance companies, since a healthier customer pool translates to their services being used less (and thus allowing the insurers to keep more of the premiums). Some providers, like Kaiser Permanente, do focus on prevention (see here). But most don’t. Why not?

A relatively concise explanation can be found in an illuminating report issued by the Bipartisan Policy Center earlier this year.

Despite the high prevalence and costs of obesity, there are several unique challenges that reduce the incentives for any single payer to address the obesity epidemic, with the exception of Medicare. First, individuals tend to change jobs every four years, and those with individual health insurance coverage frequently switch their health plans. Second, the adverse health effects of obesity often do not materialize for years or even decades after the onset of excess weight. These circumstances mean that any investment in obesity prevention is likely to be recouped by another entity, thus limiting the incentives to invest, and further fueling the obesity epidemic at older ages.

This is one reflection of the way in which prevention is a dramatically underutilized tool in the U.S. health care arsenal. There are several reasons why, though one factor stands out from the rest: “The profit motive generally doesn’t align with prevention right now,” says Bill Evans, CEO of Rock Health Advisory.

For that to change, he says, “there needs to be a reimbursement model that allows a sufficient value capture back to the entity that created the value.” With a drug, says Evans, “it’s really easy because we know you’re sick, and if it’s clear that the drug worked, payment will follow.” But as the BPC report points out, the insurer that offers prevention is unlikely to capture the value of reduced obesity and better health. So prevention is never prioritized.

For people over 65, what about Medicare coverage related to obesity prevention? For measures such as intensive behavioral therapy, Medicare only provides coverage if it’s offered by primary care providers. But they are ill equipped to offer such therapy. (Remember that medical schools devote almost no classroom time to nutrition, which means doctors simply aren’t prepared to provide dietary counseling.)

Predictably, few medical practices offer such therapy to Medicare beneficiaries and fewer than one percent of them receive the treatment. A BPC task force has recommended that dietitians be permitted to bill Medicare for behavioral therapy focused on obesity prevention.

That would certainly be a step in the right direction and could help remedy a startling fact: the obesity rate among Medicare beneficiaries is 26 percent higher than it is among those with commercial insurance, according to a 2020 study.

But in the private health market, shifting to a focus on prevention would require a dramatic rethinking of how the U.S. health care system operates. It would mean embracing preventive measures with the same energy and enthusiasm that’s traditionally associated with the pursuit of cures. Also needed would be new business models focused on wellness and helping people to thrive.

Those are unobjectionable when discussed at a high level. But there’s a lot invested in preserving the status quo, which is why it’s unlikely to change anytime soon – and why America’s obesity rate is destined to keep rising higher and higher.