With universal healthcare, improved health could come at the expense of free choice.

Do You Want a Healthcare Nudge?

by Elaine Schwartz    •    Aug 18, 2014    •    220 Views    •    TIME TO READ: 1 minute

Primarily for fiscal reasons, in Japan, most 40-74 year olds get their waist size checked each year. A part of the required annual physical exams from local government or employers, waist size is monitored because an obese population can be expensive.

It all began in 2008 with the “Matebo Law.” Because the Japanese population is aging and their diet is becoming more Western, legislators were concerned that obesity related diseases like diabetes and hypertension would increase. As a result, the law said that women whose waists exceeded the maximum of 35.5 inches and, men, 33.5 inches, had to lose weight within 3 months or get counseling if they had a weight-related ailment. Meanwhile, employers who did not meet the guidelines would have their national health insurance payments increased by close to 10%–potentially a $19 million expense for computer maker NEC.

You can imagine the new incentives that the law created. For individuals, it meant crash dieting just before the physical exam. At work, it now made sense to offer gym memberships, healthy cafeteria food, and to hire slim employees.

The Bottom Line and Opportunity Cost

And that takes us to the United States and an opportunity cost dilemma.

According to a recent study from researchers at the Olin Business School, Washington University in St Louis, individuals who do not save for retirement also tend not to take care of their health. Commenting on these results, one of the researchers said, “If you think health is really critical for productivity or health insurance costs, you really need to constrain free choice…You have to have mandates.” The mandates to which he refers could range from high sugary drink taxes to Japan’s “Matebo Law.”

Opportunity cost: Better health for the elderly or free choice

From: Washington University Newsroom

Our bottom line: We have a pretty tough opportunity cost dilemma:

A healthier and wealthier elderly population or a population with more free choice.

Or, as expressed by Cass Sunstein and Richard Thaler in Nudge, government needs to decide how much to “nudge” our behavior toward a desired goal. The bigger the “nudge,” the less we have the freedom to make our own good and bad decisions.

Sumo Wrestlers?

You might be wondering about sumo wrestlers. Most are younger than 40 so the law does not apply to them.

Sources and more...For a thorough consideration of the "Matebo Law" and its broader implications, this Boston University School of Public Health discussion is excellent as are the stories in this NY Times article and this blog. Then, for the U.S. connection, Washington University Newsroom explains its recent research on the correlation between your 401 (K) contributions and your personal healthcare diligence. Finally, the Thaler-Sunstein book, Nudge, pulls it all together by considering which "nudges" government should provide. (I added the sumo wrestler note after this entry was published.)  

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