2009-08-10 16:17:22 - A majority of Americans favor charging smokers more for health insurance as part of overall health care reform; a measure which would both raise tens of billions of dollars and slash overall health costs by reducing heart attacks, strokes, lung and other cancers, and other diseases caused by smoking, says a new MSNBC report.

"HEALTH REFORM IDEA . . . Critics Say Consequences of Individual Choice Missing from Reform Debate": www.msnbc.msn.com/id/32306655/ns/health-health_care/

The report features a legislative proposal by Action on Smoking and Health (ASH), America's first antismoking organization, which would impose a smoker user fee to make those who choose to continue smoking pay part of the health insurance costs their habit imposes on the system and and taxpayers. MSNBC reports:

"IT'S SIMPLE FAIRNESS: 'If you talk about costs, there’s something here and now that you can do,' said John F. Banzhaf, director of the anti-smoking agency Action on Smoking and Health, which has pressured members of Congress to enact a $60 a month percent [SIC] user fee to make smokers pay part of the health

insurance costs of their habit. 'If you don’t have a user fee on smokers, that forces everyone else to pay those health care costs,' said Banzhaf, who is also a professor of public interest law at George Washington University Law School. 'One argument is that it’s simple fairness��

MSNBC also reports that, according to a recent poll, 57% of Americans favor higher health insurance premiums for smokers, as contrasted with only 36% favoring a similar surcharge on the obese. One possible reason, MSNBC suggests, is that two-thirds of Americans are overweight, but fewer than 20% still smoke.

Banzhaf notes that, while federal law classifies smoking as a "behavior," obesity has been officially classified as a "disease" (for tax and Medicare purposes) and as a "health status" for health insurance purposes. That's why, says Banzhaf, the government has ruled that it is permissible to charge smokers far more for health insurance, but has limited such additional costs regarding obesity. ash.org/higher4smokers

Most people see buying and using cigarettes as a habit or a choice, thus fitting the criteria for a user fee. Although there is evidence that for many people smoking involves addiction, the addiction is to the drug nicotine, not to the act of smoking itself, which is a behavior.

But because those who desire can easily ingest nicotine from nicotine gum, nicotine patches, nicotine spray, and nicotine inhalers, their decision to ingest it by smoking rather than by using other nicotine replacement products is a choice.

Since it is a choice rather than an addiction, disease, or health status, it is fairer to impose personal responsibility for the choice by making smokers bear at least a portion of the huge costs their choice imposes on the economy and on the health care system, argues Banzhaf.

It has been estimated that imposing even a modest surcharge on smokers -- far less than the almost $200 billion their habit imposes on the American economy each year -- would provide tens of billions of dollars for health care reform which is comparable to most other proposals, but do so without raising any taxes.

"A smoker surcharge is more in the nature of a user fee," says Banzhaf, because it is imposed for engaging in an activity which imposes huge costs on government, and which any person can avoid simply by quitting. Unlike virtually all other health reform funding proposals, it targets those who are unnecessarily adding to the medical costs, and has been shown to reduce smoking and the many very expensive diseases caused or exacerbated by smoking.

America’s approximately 46 million smokers already spend over $90 billion annually on tobacco products, and their choice to use such products adds almost $200 billion in totally unnecessary health-related economic expenses to our already overburdened health care system and ailing economy, says ASH.

Requiring smokers to pay only an extra $60/month for health insurance - a fraction of what they now pay on the average for tobacco products, and an even smaller fraction of the costs they impose on the great majority of Americans who are nonsmokers - would bring in about $33 billion annually; about the same as the proposed “millionaires’ tax also estimated to yield about $35 billion/year.

Even requiring smokers to pay much less, as little as $220 more per year than nonsmokers for health insurance, would produce over $10 billion annually to help fund health care reform. This is roughly comparable to extending the current 1.45% Medicare payroll tax to capital gains earned by high-income taxpayers, which would also bring in about $10 billion each year - except that a user fee is not a tax, and therefore doesn’t violate policies or pledges against new taxes.

Also, all of the current health-care fund-raising proposals - the “millionaires’ tax increasing the Medicare payroll tax, taxing health insurance benefits, etc. - do nothing whatsoever to directly reduce health care costs, and have nothing whatsoever to do with requiring personal responsibility, argues Banzhaf.

For these reasons, ASH has proposed a surcharge (user fee) on any premiums paid by smokers for health insurance. The revenue would be paid to the government to help cover the enormous costs of health care reform, with a small percentage earmarked for antismoking and smoking cessation programs.

By increasing the cost of smoking, it would also help to slash health insurance costs, according to many studies, says ASH. Indeed, the MSNBC report notes that simply encouraging healthier behaviors through educational and other programs has proven ineffective, but increasing the costs of smoking - e.g., through higher taxes - has been shown to slash smoking as well as raise enormous amounts of revenue.

PROFESSOR JOHN F. BANZHAF III
Professor of Public Interest Law and Executive Director
Action on Smoking and Health (ASH),
America's First Antismoking Organization
2013 H Street, NW, Washington, DC 20006, USA
(202) 659-4310 // (703) 527-8418 // ash.org