Big Food vs. Big Insurance

To listen to President Obama's speech on Wednesday night, or to just about
anyone else in the health care debate, you would think that the biggest
problem with health care in America is the system itself - perverse
incentives, inefficiencies, unnecessary tests and procedures, lack of
competition, and greed.

No one disputes that the $2.3 trillion we devote to the health care
industry is often spent unwisely, but the fact that the United States
spends twice as much per person as most European countries on health
care can be substantially explained, as a study
released last month says, by our being fatter. Even the most efficient
health care system that the administration could hope to devise would
still confront a rising tide of chronic disease linked to diet.

That's why our success in bringing health care costs under control
ultimately depends on whether Washington can summon the political will
to take on and reform a second, even more powerful industry: the food
industry.

According to the Centers for Disease Control and Prevention,
three-quarters of health care spending now goes to treat "preventable
chronic diseases." Not all of these diseases are linked to diet -
there's smoking, for instance - but many, if not most, of them are.

We're spending $147 billion to treat obesity, $116 billion
to treat diabetes, and hundreds of billions more to treat
cardiovascular disease and the many types of cancer that have been
linked to the so-called Western diet. One recent study
estimated that 30 percent of the increase in health care spending over
the past 20 years could be attributed to the soaring rate of obesity, a
condition that now accounts for nearly a tenth of all spending on
health care.

The American way of eating has become the elephant in the room in
the debate over health care. The president has made a few notable
allusions to it, and, by planting her vegetable garden on the South
Lawn, Michelle Obama has tried to focus our attention on it. Just last
month, Mr. Obama talked about putting a farmers' market in front of the
White House, and building new distribution networks to connect local
farmers to public schools so that student lunches might offer more
fresh produce and fewer Tater Tots. He's even floated the idea of
taxing soda.

But so far, food system reform has not figured in the national
conversation about health care reform. And so the government is poised
to go on encouraging America's fast-food diet with its farm policies
even as it takes on added responsibilities for covering the medical
costs of that diet. To put it more bluntly, the government is putting
itself in the uncomfortable position of subsidizing both the costs of
treating Type 2 diabetes and the consumption of high-fructose corn
syrup.

Why the disconnect? Probably because reforming the food system is
politically even more difficult than reforming the health care system.
At least in the health care battle, the administration can count some
powerful corporate interests on its side - like the large segment of
the Fortune 500 that has concluded the current system is unsustainable.

That is hardly the case when it comes to challenging agribusiness.
Cheap food is going to be popular as long as the social and
environmental costs of that food are charged to the future. There's
lots of money to be made selling fast food and then treating the
diseases that fast food causes. One of the leading products of the
American food industry has become patients for the American health care
industry.

The market for prescription drugs and medical devices to manage
Type 2 diabetes, which the Centers for Disease Control estimates will
afflict one in three Americans born after 2000, is one of the brighter
spots in the American economy. As things stand, the health care
industry finds it more profitable to treat chronic diseases than to
prevent them. There's more money in amputating the limbs of diabetics
than in counseling them on diet and exercise.

As for the insurers, you would think preventing chronic diseases
would be good business, but, at least under the current rules, it's
much better business simply to keep patients at risk for chronic
disease out of your pool of customers, whether through lifetime caps on
coverage or rules against pre-existing conditions or by figuring out
ways to toss patients overboard when they become ill.

But these rules may well be about to change - and, when it comes to
reforming the American diet and food system, that step alone could be a
game changer. Even under the weaker versions of health care reform now
on offer, health insurers would be required to take everyone at the
same rates, provide a standard level of coverage and keep people on
their rolls regardless of their health. Terms like "pre-existing
conditions" and "underwriting" would vanish from the health insurance
rulebook - and, when they do, the relationship between the health
insurance industry and the food industry will undergo a sea change.

The moment these new rules take effect, health insurance companies
will promptly discover they have a powerful interest in reducing rates
of obesity and chronic diseases linked to diet. A patient with Type 2
diabetes incurs additional health care costs of more than $6,600 a
year; over a lifetime, that can come to more than $400,000. Insurers
will quickly figure out that every case of Type 2 diabetes they can
prevent adds $400,000 to their bottom line. Suddenly, every can of soda
or Happy Meal or chicken nugget on a school lunch menu will look like a
threat to future profits.

When health insurers can no longer evade much of the cost of
treating the collateral damage of the American diet, the movement to
reform the food system - everything from farm policy to food marketing
and school lunches - will acquire a powerful and wealthy ally,
something it hasn't really ever had before.

AGRIBUSINESS dominates the agriculture committees of Congress, and
has swatted away most efforts at reform. But what happens when the
health insurance industry realizes that our system of farm subsidies
makes junk food cheap, and fresh produce dear, and thus contributes to
obesity and Type 2 diabetes? It will promptly get involved in the fight
over the farm bill - which is to say, the industry will begin buying
seats on those agriculture committees and demanding that the next bill
be written with the interests of the public health more firmly in mind.

In the same way much of the health insurance industry threw its
weight behind the campaign against smoking, we can expect it to
support, and perhaps even help pay for, public education efforts like
New York City's bold new ad campaign
against drinking soda. At the moment, a federal campaign to discourage
the consumption of sweetened soft drinks is a political nonstarter, but
few things could do more to slow the rise of Type 2 diabetes among
adolescents than to reduce their soda consumption, which represents 15
percent of their caloric intake.

That's why it's easy to imagine the industry throwing its weight
behind a soda tax. School lunch reform would become its cause, too, and
in time the industry would come to see that the development of regional
food systems, which make fresh produce more available and reduce
dependence on heavily processed food from far away, could help prevent
chronic disease and reduce their costs.

Recently a team of designers from M.I.T. and Columbia was asked by
the foundation of the insurer UnitedHealthcare to develop an innovative
systems approach to tackling childhood obesity in America. Their
conclusion surprised the designers as much as their sponsor: they
determined that promoting the concept of a "foodshed" - a diversified,
regional food economy - could be the key to improving the American diet.

All of which suggests that passing a health care reform bill, no
matter how ambitious, is only the first step in solving our health care
crisis. To keep from bankrupting ourselves, we will then have to get to
work on improving our health - which means going to work on the
American way of eating.

But even if we get a health care bill that does little more than
require insurers to cover everyone on the same basis, it could put us
on that course.

For it will force the industry, and the government, to take a good
hard look at the elephant in the room and galvanize a movement to slim
it down.