Description: Obesity rates in the United States have climbed to historic highs, with nearly 42% of adults now classified as obese—a trend with significant implications for the health care system. Among Medicare-aged individuals, obesity is strongly associated with chronic conditions such as diabetes, cardiovascular disease and musculoskeletal disorders, all of which increase health care utilization and spending. As costs continue to rise, understanding the financial impact of obesity management is increasingly important for policymakers, payers and providers. This analysis uses detailed traditional Medicare claims and eligibility data to examine how obesity levels relate to health care expenditures and how costs change as members move between different diagnosed obesity categories over time

Description: When designing and pricing a healthcare product, it is not only important to know how to model frequency and severity, but it is essential to understand human behavior. Of course, the issue of anti-selection in medical insurance is well known as individuals know more about their health and prior expenditures than an insurer does. This type of behavior is certainly rational, and to be expected.