Study shows soda tax would save California millions in health care costs

Study shows soda tax would save California millions in health care costs

By Jason Hoppin, Santa Cruz Sentinel, 1/2/14

SACRAMENTO — A statewide penny-an-ounce tax on sugary drinks could save hundreds of millions in health care costs and reduce the number of new diabetes cases by thousands, a new study shows.

As shown by outgoing New York Mayor Michael Bloomberg’s efforts to ban Big Gulps, soda taxes are controversial. California lawmakers shelved past efforts by State Sen. Bill Monning, D-Carmel, to implement one, but the issue is expected to resurface shortly after the Legislature reconvenes Jan. 6.

“We see a lot of the data that shows the adverse consequences of sugar-sweetened beverages, but what’s notable is (the study) goes straight to the correlation between a sugar-sweetened beverage tax, and consumption and better health outcomes,” Monning said.

Similar proposals are aimed at rising incidents of obesity and diabetes, especially among youths, and debate has focused on how the taxes impact consumption. Released in December by medical researchers at UC San Francisco, the new study goes one step further by assessing the health care savings from a projected statewide reduction in calories consumed.

Researchers pegged the likeliest savings from reduced diabetes cases at $320 million to $620 million in 10 years. In some scenarios, that figure topped $1 billion when coronary heart disease was factored in.

The tax translates into 12 cents for a can of soda, or 67 cents for a two-liter bottle. The state Board of Equalization estimates the bill would generate up to $1.9 billion annually, though some estimates are lower. The money would be plowed back into efforts to reduce consumption.

Monning’s bill would have to be moved from a committee to the Senate floor by the end of January, and it would require a two-thirds vote for passage. Passage is considered an uphill battle.

“We’re going to do a full-court press in January,” Monning said.

The study’s authors tailored a national cardiovascular disease model to California, and then projected the impacts the proposal, leaving out diet drinks and 100 percent juices.

The model showed that with a rise in prices, statewide consumption declines from 10 to 20 percent. That decreased caloric intake led to health care savings from decreased blood pressure, body weight and incidents of diabetes — up to 23,000 fewer new cases.

The impacts were particularly profound within minorities and low-income populations, which have been disproportionately affected by chronic diseases linked to dietary intake. According to the Centers for Disease Control, 2.5 million Californians had diabetes in 2010, a number that doubled over the prior 15 years.

“These findings suggest that reductions in (sweetened beverage) consumption as might be achieved from proposed taxes could have a marked population-wide health benefit for California and have the additional benefit of reducing race (and) ethnic and income disparities in diabetes and heart disease,” the authors wrote.