During Atlanta Fed Visit, Surgeon General Says Health Equals Wealth

January 7, 2019

Raphael Bostic, President and Chief Executive Officer of the Atlanta Fed  (left) interviewes the U.S. Surgeon General, Jerome Adams.

Atlanta Fed president Raphael Bostic (left) and Surgeon General Jerome Adams. Photo by David Fine

Talk about reducing hemoglobin A1C levels, and elected officials and businesspeople typically don't spring into action. Talk about creating jobs and sparking economic activity, and they're all ears.

That tendency is part of what led the U.S. surgeon general, Dr. Jerome Adams, to enlist businesspeople, economic researchers, and policymakers in promoting his community health and economic prosperity initiative. Adams visited the Federal Reserve Bank of Atlanta last month to discuss this and other health-related issues.

Promoting prevention

Adams's basic message is twofold. First, the best way to improve public health broadly is to attack underlying causes of poor health, such as a shortage of affordable and decent housing, unsafe streets that deter exercise, uneven educational opportunities, fraying social connections, and a lack of access to healthy food and efficient transportation. It is more effective and less expensive, Adams said, to keep people from falling into the stream of poor health rather than rescuing them from the stream later.

Second, weak public health erodes economic vitality, most notably through worker absenteeism and rising spending on health care and health insurance benefits. Conversely, research shows that better health and stronger economies generally coexist.

"The fact is you aren't going to have a prospering economy, you're not going to have jobs [in the country] if you can't fill them," Adams said during a conversation with Atlanta Fed President Raphael Bostic.

Adams cited a number of statistics detailing the macroeconomic costs of bad health:

  • Six million job openings are currently unfilled in the United States, in part because poor health has kept a growing share of Americans out of the labor force over the past couple of decades.
  • Sick and absent workers cost American businesses some $225 billion a year.
  • One of five dollars in revenue at U.S. firms, on average, flows to health care costs rather than to other places such as wages.
  • Health care—medicine, hospital stays, doctor visits, and so on—accounts for only 10 to 20 percent of the factors that determine human health. Yet 95 percent of the nation’s health-related spending and energy flows toward health care, as opposed to root causes.

"It's critical for economic prosperity that we actually invest in overall health," the surgeon general stressed.

The biggest beneficiaries of such investment, he said, would be groups that spend lots of money on health care, including state and federal governments and businesses. Bostic has also studied these issues, and he seconded Adams's call for greater attention to deep-seated forces that can undermine public health.

"The economics of this are pretty clear," Bostic said.

Atlanta Fed working on social determinants of health

Underlying societal forces that shape public health are also known as social determinants of health. Federal Reserve researchers, including some at the Atlanta Fed, are studying ways to improve health by addressing social factors through, for example, partnerships between community development and health-related organizations. Sameera Fazili, a senior adviser in the Atlanta Fed's Community and Economic Development department, authored a discussion paper and launched an initiative to encourage collaborations among health care providers and community development practitioners in the Southeast. (Also see a related Economy Matters article and podcast.)

Consistent with Adams's initiative, the idea behind Fazili's effort is that up-front investments in areas such as affordable housing and access to nutritious food can reduce the incidence of costly chronic health conditions like asthma, diabetes, and high blood pressure.

Hemoglobin levels don't excite people

In the broadest sense, the nation's traditional approach to public health is not working, in Adams's view. Governments, individuals, and firms in the United States spend about $3.3 trillion a year on health care, far more per capita than any other developed nation, according to the Organisation for Economic Co-operation and Development. Yet our overall health is worse than that of most other first-world countries.

A commitment to community health in a broad sense would help, Adams said. Critical to spreading this message beyond health policy wonks to general public policy makers, businesspeople, and the public is to recruit messengers outside the health field to give health messages greater impact and urgency. To illustrate that point, Adams told an Atlanta Fed audience that he recently asked 50 mayors how many ran for office on a pledge to lower hemoglobin A1C levels, a measure of blood sugar in diabetics. Not surprisingly, nobody raised their hand.

"That's how we talk, though," Adams said of health professionals. "And it's just not resonating with folks."

Businesspeople can wield great influence in reshaping health policy, according to Adams, from offering healthier choices in cafeterias and vending machines—and making those the easier options—to structuring health benefit plans to emphasize prevention.

But business investments need not focus only on employees. Investments in the health of the broad community can generate benefits for the business as well, Adams explained. If employees go home to an unhealthy environment, then all the progress firms hoped to make through a healthy workplace might be undone. Also, half of all spending on health care benefits is for workers' family members, who generally do not spend time in the workplace. Here, Adams encouraged businesses to consider how they can contribute financial or social capital to improve broad determinants of health, from advocating for clean air, green space, and walkable neighborhoods to supporting affordable housing programs.

During his Atlanta Fed visit, Adams discussed a range of subjects beyond the community health and economic prosperity initiative. Those topics included the opioid addiction crisis, declining life expectancy in the United States, and the generally poor national ranking of Southeast states in various measures of health.

photo of Charles Davidson
Charles Davidson

Staff writer for Economy Matters

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