MEDICAID: Study Estimates Smoking’s Cost To Taxpayers
The proposed $368.5 billion global tobacco settlement "would barely cover costs paid by Medicaid to treat smoking-related illnesses, with little left over for other government and private insurance programs," according to a study released yesterday by the University of California and the Centers for Disease Control and Prevention. The study "strongly suggests the deal would shortchange government programs saddled with the expense of treating these illnesses during the" 25- year period of the settlement, the San Francisco Chronicle reports (Russell, 3/10). The study found that state Medicaid programs spend "$12.9 billion per year -- or $322 billion over 25 years" on smoking-related health problems, the San Francisco Examiner reports.
State By State
The authors of the study said it was the first to consolidate all state figures to come up with a comprehensive look at how much smoking costs taxpayers. "The report analyzes Medicaid programs in all 50 states and the District of Columbia," the Examiner reports. The study "does not include the impact of smoking-related health problems on Medicare or private insurance programs" (Zamora, 3/9). The report found that "Nevada had the highest smoking rate in the country, 30.3% in 1993, and spent the highest percentage of its Medicaid budget -- 19.2% -- on smoking-related illness." Utah had the lowest smoking rate, 15.3%, and "Washington spent the smallest percentage of its Medicaid budget, 8.5%, on smoking-related health care." Overall, "New York had the highest ... smoking-related Medicaid expenditure -- $1.85 billion." California was 10th in the nation, spending 16.2% of its budget on smoking-related costs.
Nick Of Time
The study, which is published in the journal Public Health Reports, "could create further problems" for the proposed settlement "because it implies that the costs that smoking imposes on taxpayers are considerably higher than the sums set aside in the settlement to cover Medicaid costs." The Los Angeles Times reports that the "proposed settlement sets aside about $190 billion to cover such costs, with the remainder going toward smoking cessation programs, counter-advertising campaigns, medical research and a tort fund of up to $5 billion a year to compensate individuals who can demonstrate that they developed medical problems as a result of smoking."
Tobacco industry spokesperson Lance Morgan "declined to dispute the new cost figures, but defended the size of the proposed settlement, saying it 'represents real, not estimated, money to pay for health costs and anti-smoking programs that public health groups have sought for years'" (Weinstein, 3/10). However, UC-San Francisco health economics professor Dorothy Rice, one of the study's lead authors, said, "If you multiply that annual total cost for all the states just for Medicaid by 25 you get very close to the $368 billion in the proposed global settlement, which simply means there's no room for any of the other federal programs and private health insurers that have paid out just as the Medicaid program has for the high costs of the adverse effects of smoking" (Reuters/Boston Globe, 3/10).