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Pound Wise and Penny Foolish? Weight Loss and The Dynamics of Health Care Spending

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  • Koch Thomas G

    () (University of California, Santa Barbara)

Abstract

Current estimates of obesity costs ignore the impact of future weight loss and gain, and may either over or underestimate economic consequences of weight loss. In light of this, I construct static and dynamic measures of medical costs associated with body mass index (BMI), to be balanced against the cost of one-time interventions. This study finds that ignoring the implications of weight loss and gain over time overstates the medical-cost savings of such interventions by an order of magnitude. When the relationship between spending and age is allowed to vary, weight-loss attempts appear to be cost-effective starting and ending with middle age. Some interventions recently proven to decrease weight may also be cost-effective.

Suggested Citation

  • Koch Thomas G, 2011. "Pound Wise and Penny Foolish? Weight Loss and The Dynamics of Health Care Spending," Forum for Health Economics & Policy, De Gruyter, vol. 14(2), pages 1-17, July.
  • Handle: RePEc:bpj:fhecpo:v:14:y:2011:i:2:n:7
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    1. Gary Charness & Uri Gneezy, 2009. "Incentives to Exercise," Econometrica, Econometric Society, vol. 77(3), pages 909-931, May.
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