Why Slash Medicare $3 Billion Rather than Simply Reduce Smoking?

WASHINGTON - Nov. 29, 2013 - PRLog -- WASHINGTON, D.C. (November 29, 2013):  Congressional leaders have reportedly agreed to slash $3 billion in Medicare spending, largely by cutting payments to doctors performing vital surgeries, although reducing smoking by as little as 1%, raising cigarette taxes by a few cents, or prohibiting smoking in indoor public places would save at least as much money by attacking a major cause of unnecessary surgeries rather than threatening the health of people who vitally need them, suggests public interest law professor John Banzhaf.

        Smoking costs the American economy an estimated $3 billion in totally necessary costs every year, so reducing smoking by as little as 1% would save $3 billion, and potentially make the cuts in Medicare expenditures unnecessary.  This could be done is several very simple and largely painless ways, all of which are very strongly supported by a majority of the public.

        FIRST, as reported in the Wall Street Journal, the British Medical Journal, and elsewhere, imposing a smoker surcharge by requiring smokers to pay more for their health insurance – as the Affordable Care Act [ACA] provides – can slash smoking rates among employees by 50%.

        But legislators in almost a dozen jurisdictions have blocked the surcharges in their states.  Getting only one or two to change their minds, and permit the surcharges now in effect in most of the country to go into effect in their states, could make this tampering with Medicare reimbursement unnecessary.

        SECOND, earlier in the year, it was estimated that increasing the federal tax on cigarettes by 94 cents/pack would save the country more than $63 billion in long-term health care costs, and bring in about $78 billion in additional revenue, for a total of  $141 billion.  So it would appear that a mere 3 cents per pack increase in the federal tax would bring in more than the $3 billion planned to be slashed from Medicare.

        THIRD, currently less than half of the population live in a jurisdiction with comprehensive clean air laws where they are protected in workplaces, restaurants, and bars from the deadly secondhand smoke which kills over 50,000 Americans per year.  Such limits on smoking are the most effective – and one of the least expensive – ways to help the over 90% of current smokers who want to quit to actually do so.

        So, in addition to the billions of dollars of reduced medical care costs from no longer having to treat nonsmokers exposed to secondhand smoke for everything from heart attacks and stroke to cancer and respiratory problems, restricting smoking in public places would slash the number of smokers, saving their employers an average of over $12,000/year per smoker.  Thus, a federal regulation prohibiting smoking in workplaces, or a similar law in only a few states, could save more than the $3 billion a year.

        Prof. Banzhaf – who is a leader in banning smoking, and who was primarily responsible for the Obamacare smoking surcharge – says that it’s high time the government stopped saving a few billion here and there by forcing the cancellation of insurance plans, cutting reimbursements to doctors, or simply trying to shift more of the costs of medical care to employers and the rich, while ignoring the real elephant in the room; the small percentage of the population whose smoking imposes huge costs of everyone else.

JOHN F. BANZHAF III, B.S.E.E., J.D., Sc.D.
Professor of Public Interest Law
George Washington University Law School,
FAMRI Dr. William Cahan Distinguished Professor,
Fellow, World Technology Network,
Founder, Action on Smoking and Health (ASH)
2000 H Street, NW
Washington, DC 20052, USA
(202) 994-7229 // (703) 527-8418
http://banzhaf.net/ @profbanzhaf