MEMORANDUM
Re: Wellness and Fitness Grant & Healthy Living Incentives
Date: November 24, 2008

Introduction
Currently, more than 90% of the 2.2 trillion dollars spent on healthcare is for treating diseases and their complications, while less than 3% is designated for population-based prevention.[1] Considering that many of the diseases treated are preventable, various healthcare costs can be avoided by implementing intentional, effective prevention measures.

One of the most preventable conditions is obesity. In 2005-2006, more than one-third of Americans were obese and over 13% of children were obese in 2002.[2][3] The medical expenses related to obesity were estimated at 9.1% of total healthcare expenditures in 1998, which is calculated to be over 200 billion dollars in 2008.[4] A large percentage of this money is spent on treating the co-morbidities of obesity including high blood pressure, high cholesterol, type 2 diabetes, heart disease, stroke, gallbladder disease, osteoarthritis, respiratory problems, and some cancers.[5]

This administration is passionate about America’s health and reducing healthcare costs, and we believe the health consequences and costs of obesity are very problematic. However, as Senator McCain once stated, “Americans solve problems. We don't run from them.”[6] Therefore, the McCain administration proposes a solution by innovatively promoting exercise and nutrition to combat childhood obesity and by encouraging health insurance companies to reward policyholders with healthy lifestyles.

Proposals
Wellness and Fitness Grant
The McCain administration proposes to offer annual Wellness and Fitness Grants from the Department of Education to schools that promote health and physical activity in their curriculum. Schools that are compliant with the Surgeon General’s recommendations of daily, quality physical education and stipulations regarding nutrition, as outlined in the 2001 Call to Action, will be eligible for the grant.[7] The fulfillment of these requirements will be quantitatively measured by programs such as the Coordinated Approach to Child Health (CATCH) program. The CATCH program has been shown to improve health by reducing obesity rates and even result in long-term health benefits of the enrolled children following the program’s completion.[8] April, 2007. Accessed March 14, 2008.] The actual standards and program details will vary by state much like the No Child Left Behind (NCLB) Act guidelines in order to comply with the 10th Amendment. The Wellness and Fitness Grant will become the fifth major state grant program offered by the Department of Education.[9]

Although initiating innovative school programs will help promote healthy living, we still have our individual responsibility to educate our children. Senator McCain firmly believes that we should consistently teach our children about the “vital life information” of health, nutrition and exercise.[10] Fostering this environment for our children will promote one clear message about healthy living.

Healthy Living Incentives
The McCain administration desires to reduce obesity in adults by giving tax breaks to health insurance companies that monetarily reward policyholders and their families who actively practice wellness and fitness.[11] Healthy living practices may include proof of membership and attendance of insurance approved health clubs, regular medical physical examinations, enrollment in health classes, etc. The eligibility requirements and standards will vary according to insurance company, but they must abide by a “10% Rule” to receive tax breaks. The insurance company must rebate at least 10% of an eligible policyholder’s monthly premium to no less than 10% of their total policyholder clientele. By giving insurance companies incentives to offer rebates for healthy living, policyholders and their families will have increased motivation to develop and maintain a healthy lifestyle.

Challenges
The biggest challenge in implementing the aforementioned proposals will be funding. With high funds supporting the NCLB act, people may think that enough money has been allocated to the Department of Education. Others may oppose the Wellness and Fitness Grant proposal because little immediate monetary return will be seen. In regards to the Healthy Living Incentives proposal, people may question if too many tax breaks will be given because the administration desires to give tax breaks to the newly proposed insurance companies as well as individuals and families. In short, the greatest concerns will be associated with the financial cost of these disease prevention proposals.

Conclusion
The biggest hurdle in allocating funds for promoting healthy living is that few politicians regard them as good investments because there is little or no financial return. However, it is projected that every dollar spent on programs like CATCH will save $1.20 in future lost wages and medical expenses by the time the enrolled students reach 40-65 years of age.[12] April, 2007. Accessed March 14, 2008.] Furthermore, healthy living rebates implemented by companies like IBM have significantly lessened annual healthcare claim costs of their employees.[13] Therefore, these proposals will reduce the amount spent on healthcare, combat obesity, and promote better health.

Thus, the McCain administration recognizes the value of investing in disease prevention and health maintenance because we are confident that it will lower health care costs and improve the health and lives of Americans.