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Cutting Costs and Improving Health: Federal Food Policy Reforms Could Save Billions

A Report from the Physicians Committee for Responsible Medicine
July 28, 2011

Cost Savings

Short-Term Savings

As noted above, the above changes will lead to major financial savings over the short and long term. Over the next ten years, cost savings are estimated as follows in current dollars, without adjustment for inflation:

Policy Change

Savings (over 10 years)

Elimination of direct payments

$50 billion
Crop insurance privatization                       $70 billion
Clean-up program privatization             $9 billion
SNAP reform                                                   $240 billion
Commodity reform                                            $14 billion
Total short-term savings:  $383 billion  

Long-Term Savings

Over the long term, an end to the promotions of unhealthful foods that have escalated health care costs in recent decades could mean substantial savings. To the extent that consumer behavior changes as a result of an end to direct and indirect subsidies and the elimination of promotions of unhealthful foods, the financial savings can be estimated in various models.

In 1995, the medical costs attributable to meat consumption were estimated at $28.6 billion to $61.4 billion annually.2 These figures related solely to that portion of the direct medical care costs for seven conditions (hypertension, heart disease, cancer, diabetes, gallbladder disease, obesity-related musculoskeletal disorders, and foodborne illness) that could be attributed to meat consumption based on published prevalence studies.

The continued inflation of medical prices and rising disease rates have greatly increased these costs. The medical costs of meat consumption, based on 1992 data, but inflated to 2011 dollars corresponding to increases in medical costs, are estimated at approximately $60 billion to $130 billion annually. If 5 percent of these costs were saved, it would amount to $30 billion to $65 billion over a 10-year period. A greater or lesser degree of estimated change in consumer behavior would lead to proportionate adjustments in estimated savings.

However, this estimate relates only to direct medical costs. Indirect costs of illness, such as the lost tax revenue from people who become sick or disabled or who die prematurely, are much greater than direct medical costs.

Also left out of this analysis are potential medical cost savings related to changes in consumption of other food products. For example, dairy products are the largest source of saturated fat in the American diet, and are subjects of massive promotions. Sugar intake, particularly in the form of sweetened beverages, has risen in recent years. To the extent that vegetable and fruit intake increases, overall improvements in health are to be anticipated. However, these products have not been the subject of analyses that would permit estimates of potential savings in health care costs.

This analysis does not include potential savings though changes in overseas marketing programs and other areas that may have substantial health effects of their own.

References
1. Craig WJ, Mangels AR. Position of the American Dietetic Association: Vegetarian Diets. J Am Diet Assoc. 2009;109:1266-1282.
2. Tonstad S, Butler T, Yan R, Fraser GE. Type of vegetarian diet, body weight, and prevalence of type 2 diabetes. Diabetes Care. 2009;32(5):791-796.
3. Barnard ND, Nicholson A, Howard JL. The medical costs attributa­ble to meat consumption. Prev Med. 1995;24:646-655.
4. Steinfeld H, Gerber P. Livestock production and the global environment: consume less or produce better? Proc Natl Acad Sci U S A. 2010;107(43):18237-18238.
5. Food and Agriculture Organization: Climate change and food security. http://www.fao.org/nr/index_en.htm Prepared by the United Nations for the UN Climate Change Conference in Bali - November 2007.
6. Pimentel D. Pimentel M. Sustainability of Meat-based and Plant-based Diets and the Environment. Am J Clin Nutr. 2003;78(suppl): 660S-3S
7. Marlow H. Hayes W. Soret S. et al. Diet and the Environment: Does What You Eat Matter? Am J Clin Nutr. 2009;89(suppl):1699S-703S
8. Reijnders L. Soret S. Quantification of the Environmental Impact of Different Dietary Protein Choices. Am J Clin Nutr. 2003; 78(3 suppl): 664S – 668S
9. Pelletier N, Tyedmers P. Forecasting potential global environmental costs of livestock production 2000-2050. Proc Natl Acad Sci U S A. 2010;107(43):18371-18374.
10. Scallan E, Griffin PM, Angulo FJ, Tauxe RV, Hoekstra RM. Foodborne illness acquired in the United States—unspecified agents. Emerg Infect Dis. 2011;17:16-22.
11. Centers for Disease Control and Prevention. Number of reported foodborne disease outbreak-associated illnesses, by etiology and food commodity – United States, 2007. Available at: http://www.cdc.gov/outbreaknet/pdf/2007MMWRSurveillanceOutbreaks_ExpandedTable2_WEB.pdf.  Accessed May 18, 2011.
12. Scharff RL. Pew Trusts. Health-Related Costs from Foodborne Illness in the United States Produce Safety Project. March 3, 2010. Available at: http://www.producesafetyproject.org/admin/assets/files/Health-Related-Foodborne-Illness-Costs-Report.pdf-1.pdf. Accessed March 2, 2011.
13. Barnard ND. Trends in food availability, 1909-2007. Am J Clin Nutr. 2010;91(suppl):1530S-6S.
14. Carlson, A., Lino, M., Juan, W-Y., Hanson, K., & Basiotis, P.P. (2007). Thrifty Food Plan, 2006. (CNPP-19). U.S. Department of Agriculture, Center for Nutrition Policy and Promotion. Available at http://www.cnpp.usda.gov/Publications/FoodPlans/MiscPubs/TFP2006Report.pdf, accessed July 26, 2011.



Download

Introduction

Eliminate Subsidies for Unhealthful Products

Prioritize Healthful Foods in Food Assistance Programs

Cost Savings

Related Links:

Health and Wellness Expert Jillian Michaels Urges Congress to Slim Down Bulging Budget Deficit

Dr. Barnard’s April 19, 2012, Capitol Hill Presentation on Subsidies and SNAP



 
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