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New report suggests tax on soft drinks to lessen health insurance costs

Posted On Fri, September 18, 2009

A new report by the New England Journal of Medicine that draws a link between sugar-sweetened beverages and a bevy of medical issues is suggesting a tax on the beverages that reduce both their consumption as well as their effects on health care expenditures.

According to the report, titled The Public Health and Economic Benefits of Taxing Sugar-Sweetened Beverages, various studies found a link between sugary beverages and health issues. One study that tracked middle school students for two academic years found that the risk of obesity "increased by 60 percent for every additional serving of sugar-sweetened beverages per day."

Another eight year study in which women either increased or decreased their consumption of sugar-sweetened beverages halfway through the study found that those who increased their intake gained an average of 17.6 pounds while those who reduced consumption only gained 6.2 lbs.

The study also found that medical costs for overweight and obesity are estimated to be $147 billion, which accounts for 9.1 percent of U.S. health care expenditures, and added that half of the costs were paid through Medicare and Medicaid programs.

In order to alleviate both the medical and health insurance-related problems, the study suggested that states either impose or expand their taxation by "adding an excise tax of one cent per ounce for beverages that have any added caloric sweetener" or to "tax beverages that exceed a threshold of grams of added caloric sweetener or of kilocalories per ounce."

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