Researchers at Tufts University in Boston estimated the cost-effectiveness of the Food and Drug Administration’s required “added sugar” labeling over a 20-year period to see how it could nudge consumers to reduce their intake of sugary foods and drinks, lead to health improvements and decrease health-care spending.

Labeling food and drinks with “added sugar” could lower heart disease and diabetes risks, and cut health-care costs by more than $31 billion, the new study suggests. The estimated annual health-care costs of obesity-related illness in the U.S. is over $190 billion, or nearly 21% of medical spending.

The estimated annual health-care costs of obesity-related illness is $190 billion, or nearly 21% of medical spending. To estimate the cost-effectiveness of the FDA’s “added sugar” labeling, researchers used national data from the National Health and Nutrition Examination Survey on population demographics, risk factors, dietary habits and diseases to evaluate and predict cumulative health outcomes and costs based on current dietary trends.

“The purpose of our study was to estimate the impact of the FDA’s “added sugars” label on reducing sugar intake and preventing diabetes and cardiovascular disease,” says Renata Micha, associate research professor at the Friedman School of Nutrition Science and Policy at Tufts University in Boston. “Our results indicate that timely implementation of the ‘added sugars’ label could reduce consumption of foods and beverages with added sugars, which could then lead to an improvement in health and a reduction in health-care spending.”

The study was published in the peer-reviewed American Heart Association’s “Circulation” journal. Researchers predict that “added sugars” label would prevent more than 354,000 cardiovascular disease cases and lead to nearly 600,000 fewer cases of Type 2 diabetes. This is the latest study to calculate the potential cost-saving and health benefits of packaged food labels. A separate study on product food labeling found that when consumers see health-related claims, icons, symbols and logos, their intake of calories is reduced by 6.6%, with total fat intake down by 10.6% and other unhealthy meal options down by 13%.

The FDA requirement was announced in 2016. The first major revision to the Nutrition Facts label since 1993, it was aimed at helping consumers make more informed decisions about what they eat, drink and feed their families. Under the labeling policy, packages that are between one and two servings –– like a 20-ounce soda –– must specify calories and other nutrients as “one serving” since people typically drink it all in one sitting. Most food manufacturers were required to use the new label by July 2018. However, the FDA recently announced a delay in the mandatory implementation of the updated Nutrition Facts label until 2020 for large manufacturers, and to 2021 for smaller ones. Some manufacturers have already started labeling their products with the “added sugar” content.

Micha says the “added sugars” label could likely urge food and drink producers to rework their products to become healthier for consumers. She compared the effort to how food makers reduced or removed trans fats from their products after trans-fat labeling went into effect.

Americans consume more than 300 calories per day from added sugar, a 30% increase in the last three decades. And sugary drinks are the major cause, followed by sweets like cookies, cakes, pastries, candies and ice cream. Approximately 40% of U.S. adults aged 20 to 74 are obese, up from around 13% between 1960 and 1962, and 23% between 1988 and 1994, according to a separate study. And obesity is the second leading risk factor for disability and the fourth leading risk factor for mortality in the US.