The Price of America’s Obesity Epidemic: Aetna Inc. (AET), Southwest Airlines Co. (LUV)

Businesses will see even more costs due to obesity if rates keep climbing. Studies have shown a correlation between workplace absenteeism and obesity, and more overweight Americans will hamper firms’ productivity. Estimates peg absenteeism-related losses for American businesses at up to $6 billion or more per year, according to data from a Duke University study led by Eric Finkelstein.

Signs of hope in the crisis
While many businesses — and the economy at large — will be hurt by the unabated rise of obesity, some stand to gain.

Health care companies offer hope for American businesses. Medical device manufacturers — in particular, companies with major orthopedics branches such as Johnson & Johnson (NYSE:JNJ) and Stryker Corporation (NYSE:SYK) — stand to gain with rising obesity rates. More overweight Americans mean more customers who need hip- and joint-servicing products to manage higher weight loads, and J&J and Stryker rank among the top companies in those departments.

Expect pharmaceutical firms entrenched in the diabetes market to thrive as well. Obesity-related diabetes has surged across the U.S., with the CDC estimating that 8.3% of the population — or more than 25 million people — suffering from the disease in 2010. Diabetes alone inflicted $174 billion in total estimated costs in 2007, and firms have profited off the disease’s rise: Merck & Co., Inc. (NYSE:MRK)‘s Januvia and Janumet family of diabetes medications pulled in more than $5.7 billion in sales in 2012. Competitors like Johnson & Johnson are pushing into the diabetes market as well, keen to make a buck off America’s growing problem.

Companies will capitalize regardless of what happens, but it’s not too late for America to beat back the obesity epidemic before it capsizes the economy. A 5% reduction in BMI in every U.S. state could reduce health care spending by 7% or more, freeing up billions of dollars for the many needs of the future. Smaller waistlines would mean less fuel expenditure for airlines, cars, and other means of transportation, cutting down on both costs and emissions.

How can America start fighting back against obesity? Media campaigns always help, and the “Let’s Move” campaign from First Lady Michelle Obama has sparked public awareness about the problem. Still, more is needed, and the answer could come from how the country pushed back against the health hazards of smoking. Media campaigns, advertising regulations, and taxation helped drive back tobacco’s toll, all while mostly avoiding dreaded public health-influenced bans that can often hurt as much or more than they help — as New York’s ban on large soft drinks (and going way back in time, Prohibition) has shown.

Whether it’s by taxing high-calorie or high-fat foods or incentivizing fitness and lower body fat percentage rates through ongoing health care reform actions, more impacting action is needed to confront the challenges of obesity. If nothing is done to combat this epidemic, America’s greatest crisis will only grow larger — threatening the financial security and freedom of individual Americans, businesses, and the future of the economy as a whole.

It’s time for America to step up and drive back obesity’s costly advance. The well-being of the future demands nothing less.

The article The Price of America’s Obesity Epidemic originally appeared on

Fool contributor Dan Carroll has no position in any stocks mentioned. The Motley Fool recommends Johnson & Johnson and Southwest Airlines. The Motley Fool owns shares of Johnson & Johnson.

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