There’s an interesting report from actuarial consultants Milliman  that pours some cold water on the heated debate over State Health Plan costs associated with smokers and people with a high Body Mass Index (BMI). The report, Impact of Height, Weight, and Smoking on Medical Claims Costs , released in April, was an update of Milliman’s Medical Underwriting Guidelines.
Controlling for age and gender, the study found that smokers cost about 9% more than non-smokers. However, when people’s medical histories are known the cost difference is only 5%. The costs associated with BMI are less clear.
The report finds that BMI is not the best way to predict added healthcare costs, even when medical history is known. BMI roughly uses weight divided by height squared and the report finds that weight divided by height cubed (known as Rohrer’s Index) is a better indicator.
Using BMI as a predictor, actual costs are greater for severely underweight and severely overweight people and, for taller people (within a given range of BMI). BMI is also generally criticized because professional athletes can be classified as obese using the measure.
The State Health Plan should be cautious in the use of smoking and BMI criteria for setting premium rates.