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S.C. insurer BlueCross Blue Shield going after tobacco users

http://www.postandcourier.com/20160814/160819795/sc-insurer-bluecross-blue-shield-going-after-tobacco-users

Some tobacco users who have been lying about their smoking status to skirt higher health insurance premiums will be expected to shell out more money this fall.

A spokeswoman for BlueCross BlueShield of South Carolina said the company is currently reviewing medical records to determine which patients enrolled in Affordable Care Act plans use tobacco.

If those patients aren’t already paying a higher surcharge for their tobacco use, Patti Embry-Tautenhan said BlueCross BlueShield will contact them soon and ask them to pay more by Oct. 1. The surcharge will apply to future premiums, she said. The company will not impose the fee retroactively.

“Because tobacco users must self-identify, it allows for potential abuse of the system, which ends up costing all of us,” she said. “However, our experience is that a very small percentage of our members use tobacco and do not pay the surcharge. And we are in the process of communicating with those members.”

More than one in five South Carolina adults smoke, the eighth highest smoking rate in the country.

But federal numbers also show 9 percent of Obamacare customers in this state own up to smoking, suggesting that some adults may be lying about their tobacco status.

The federal health care law allows insurers to charge higher premiums to customers who smoke.

BlueCross BlueShield of South Carolina and its subsidiary, BlueChoice, impose a 20 percent surcharge for tobacco users who have purchased health insurance on HealthCare.gov.

South Carolina Department of Insurance Director Ray Farmer said Aetna, which also sells Obamacare plans in this state, imposes a 10 percent surcharge for tobacco use.

Reach Lauren Sausser at 843-937-5598.

Cigarette Affordability in China: 2001 – 2016

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Economic burden of smoking: a systematic review of direct and indirect costs

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Assessing cost of illness related to tobacco

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Study: State could save $1.7B in health-care costs by cutting smoking rate

http://www.richmondregister.com/news/study-state-could-save-b-in-health-care-costs-by/article_f1c02086-39b2-11e6-bf0e-cfb148b4bcb2.html

If Kentucky could cut its smoking rate to the national average, it would save an estimated $1.7 billion on healthcare the following year, a study reports.

Kentucky’s smoking rate is 26 percent, and the national average is 18 percent.

The study at the University of California-San Francisco estimates that a 10 percent decline in the national rate would save $63 billion the next year in health-care costs.

“What it adds to our knowledge is that we can save money quickly,” Ellen Hahn, University of Kentucky nursing professor and director of its smoke-free policy center, told Kentucky Health News. “We are not talking 18 to 20 years down the road. … If we reduced our smoking rate at least 10 percent, we would see dramatic reductions in health-care cost in just one year.”

The study also found that smoking makes Kentucky spend $399 more per person, per year, on health care than it would if the state’s rate equaled the national rate. That was the highest figure of any state.

Conversely, low rates of smoking save Utah and California, respectively, $465 and $416 per person per year compared to what they would spend if their smoking rates were the national rate.

“Regions that have implemented public policies to reduce smoking have substantially lower medical costs,” the study’s authors said in a news release. “Likewise, those that have failed to implement tobacco control policies have higher medical costs.”

Lexington’s smoking rates dropped 32 percent in just one year after it enacted its smoking ban, which amounted to an estimated $21 million in smoking-related healthcare costs savings, according to a University of Kentucky study led by Hahn and published in the journal Preventive Medicine.

The UCSF study, published in PLOS Medicine, looked at health-care spending in each state and the District of Columbia from 1992 to 2009, and measured the year-to-year relationship between changes in smoking behavior and changes in medical costs.

Many studies have shown that smoking bans and other smoke-free policies decrease smoking rates, reduce smoking prevalence among workers and the general population, and keep youth from starting to smoke.

These have been some of the arguments for a statewide smoking ban, but efforts to pass one have stalled because new Republican Gov. Matt Bevin opposes a statewide ban and says smoke-free policies should be a local decision.

Bevin won big budget cuts from the legislature to set aside hundreds of millions of dollars for shoring up the state’s pension systems, but the study hasn’t made the administration look at a smoking ban as a source of savings. A ban passed the House last year but died in the Senate.

Asked how this study might affect the administration’s position on a statewide smoking ban, Doug Hogan, acting communications director for the Cabinet for Health and Family Services, said in an email, “Smoking bans are a local issue, rather than a one-size-fits-all solution.” Bevin’s office and Senate President Robert Stivers did not respond to requests for comment.

Hogan said the cabinet is committed to helping people quit smoking: “Education and proper policy incentives are critical tools that the state can use and as our commonwealth crafts its Medicaid wavier, it is looking very closely at ways to best incentivize smoking cessation to improve health and decrease cost to the commonwealth.”

Hahn said, “Kentucky has the dubious honor of leading the nation in cigarette smoking, and we have for many years. … it is a major driver of health-care cost. And in a climate where we are trying to save every dollar … I think that we should pay attention to this study because what it really says is that we can save a boatload of money if we help people quit and we can save it quickly.”

Other possible tobacco-control measures include raising cigarette taxes, anti-smoking advertising campaigns and better access to smoking-cessation programs. Hahn said the state gets some money from the federal Centers for Disease Control and Prevention and the tobacco master settlement agreement for prevention and cessation efforts, but the state needs to do more.

“We spend very little on the things that we know work, like helping people quit smoking, like doing widespread media campaigns on television, radio and print,” she said. “We just don’t do that in our state. We never have. In fact, we spend very little, about 8 percent of what the CDC say we should.”

The study shows significant health-care savings could occur so quickly because the risks for smoke-related diseases decreases rapidly once a smoker quits.

“For example, the risk of heart attack and stroke drop by approximately half in the first year after the smoker quits, and the risk of having a low-birth-weight infant due to smoking almost entirely disappears if a pregnant woman quits smoking during the first trimester,” says the report.

“These findings show that state and national policies that reduce smoking not only will improve health, but can be a key part of health care cost containment even in the short run,” co-author Stanton Glantz, director of the UCSF Center for Tobacco Control Research and Education, said in the release.

Hahn said, “People don’t realize how effective quitting smoking really is, how much money it really saves. So that is the value of this paper. It is a wake-up call for those of us doing this tobacco control work and for elected officials who are trying to save money and redirect funds and shore up the economic health of Kentucky. … Doing all we can to reduce smoking saves lives and money. What’s better than that?”

Kentucky Health News is an independent news service of the Institute for Rural Journalism and Community Issues, based in the School of Journalism and Media at the University of Kentucky, with support from the Foundation for a Healthy Kentucky.

TOLL OF TOBACCO IN THE UNITED STATES OF AMERICA

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Plain packaging & tobacco taxes: an antidote for manipulation and deception

plain-packaging

For 2016’s World No Tobacco Day, celebrated today, the World Health Organization (WHO) and the Secretariat of the WHO Framework Convention on Tobacco Control (FCTC) are calling on countries to get ready for plain packaging of tobacco products. Why, may you ask?

https://blogs.worldbank.org/health/plain-packaging-tobacco-taxes-antidote-manipulation-and-deception

The importance of this regulation is best explained in “Phishing for Phools” a new book by Nobel Prize Laureates in Economics, George Akerlof (2001) and Robert Shiller (2013). We humans think in terms of stories, Akerlof and Shiller observed, and our decisions are consequently determined by the stories we tell ourselves. Advertisers use this to their advantage by “graph[ing] their story” onto ours, and thereby influencing the decisions we make—in this case, to get us addicted to tobacco use, particularly teenagers and low-income people.

Australia passed legislation in 2012 to reduce the appeal of smoking by restricting the use of logos, colors, brand images, or promotional information on packaging other than brand names and product names displayed in a standard color and small font below hard-hitting warnings depicting the negative health consequences of smoking. In the two years following the law, tobacco consumption declined 12.8%, which some have attributed, in part, to the legislation.

Other countries are starting to follow Australia’s example. Similar regulations approved in France and the United Kingdom are set to begin implementation in 2016, and they are under formal consideration in several other countries across the world. Uruguay and Thailand already mandate that at least 80% of front and back of the packaging be covered with graphic health warnings. And Mauritius leads Africa in terms of requirements for tobacco packaging and labelling.

The arsenal of effective consumer protection regulations that contribute to reduce the social acceptability of smoking also includes advertising bans, smoke-free public spaces, and restricting sales to minors. In the United States as mandated to the U.S Food and Drug Administration (FDA) by the 2009, “Family Smoking Prevention and Tobacco Control Act,” regulatory agencies have authority to regulate the manufacture, distribution, and marketing of tobacco products, including e-cigarettes, like any other drug.

Cigarette taxes also play an important role in tobacco control. Evidence presented by high-level officials from China, Philippines, Uruguay, and the United States at a global tax conference held at the World Bank this past week, shows that raising tobacco taxes increases prices, reduces consumption, and improves the public health by reducing ill health and premature death.

Expanding the Global Tax Base: Taxing to Promote Public Goods, Tobacco Taxes: (Pictured left to right) Patricio Marquez, World Bank Group, Fernando Serra, Ministry of Economy & Finance, Uruguay; Philip Cook, Duke University; George Akerlof, Georgetown University; Jason Furnman, US President’s Council of Economic Advisers; Jeremias Paul, former Under Secretary of Finance, Philippines; and Rose Zheng, University of International Business and Economics,  Beijing, China.

Expanding the Global Tax Base: Taxing to Promote Public Goods, Tobacco Taxes:
(Pictured left to right) Patricio Marquez, World Bank Group, Fernando Serra, Ministry of
Economy & Finance, Uruguay; Philip Cook, Duke University; George Akerlof, Georgetown
University; Jason Furnman, US President’s Council of Economic Advisers; Jeremias Paul,
former Under Secretary of Finance, Philippines; and Rose Zheng, University of International
Business and Economics, Beijing, China.

Contrary to the assumption that tobacco taxes are financially regressive, Jason Furman, the Chairman of the US President’s Council of Economic Advisers, illustrated how the sum of benefits fully offset the additional cost of taxes on consumers—tobacco taxes disproportionately benefit lower income households because as tobacco taxes increase, better health ensues, less money is needed for smoking-related healthcare services, and labor productivity improves due to reduced sickness and absenteeism.

Raising tobacco taxes is also an easy way to raise domestic revenue for health and other priority investments, as it is done in the Philippines under the 2012 Sin Tax Law to expand health insurance coverage to 15 million poor families or about 45 million people, and in the United States after federal tobacco taxes were increased in 2009 by US President Obama to fund the expansion of the Children’s Health Insurance Program (CHIP) for low-income children. The 2015 excise tax increase at the wholesale level in China, which has increased the tax rate as a percentage of the retail price from 49% to 56%, is a significant step for China, not only because the country is the largest producer and consumer of tobacco in the world, but also to deal with the growing burden of non-communicable diseases. The experience of Uruguay, a country with one of the most comprehensive tobacco control laws in the world, shows that its application has significantly decreased smoking among adults from nearly 50% to about 20% over the past decade.

We have to be clear that tobacco control measures, such as plain packaging and higher taxes, are not part of a “nanny state” designed to hinder “free choice” in society. For those of us who have lost loved ones due to tobacco-related diseases, the story is a painful one. Simply told, our loved ones had become addicted to cigarettes, a product that unlike any other product on the market, kills when used as promoted by the “feel good” stories of manufacturers. Indeed, despite new year’s resolutions and promises to quit, they could not shake off the “urge” to smoke!

On this World No Tobacco Day, the international community needs to recommit itself to support countries in adopting plain packaging legislation to make tobacco use less attractive and increase taxes to make tobacco products less affordable. Improving public health and protecting future generations from the risks of tobacco use should be a priority in the global social contract. We owe it to the memory of our loved ones and to the millions of people who have died prematurely because of their tobacco addiction.

Smoking makes low-income people even poorer: Minister

http://www.thejakartapost.com/news/2016/05/28/smoking-makes-low-income-people-even-poorer-minister.html

Indonesia has some of the lowest cigarette prices in the world, with a pack costing just US$1.

In a country where 28.6 million people are still living below the poverty line, cigarette addiction makes low-income people even poorer, to the extent where some people sacrifice basic necessities — such as their children’s education — in order to buy cigarettes.

Health Minister Nila F. Moeloek said recently that she had noticed an alarming trend where children dropped out of school because their parents preferred to spend their income on cigarettes, rather than education.

“There are many children who have to drop out of school because of a lack of money. And we have lost count of how many children are malnourished because the household spending goes mostly to cigarettes,” she said.

The poorest families in Indonesia spend almost 12 percent of their incomes on cigarettes, according to a report on Indonesia by the Global Adult Tobacco Survey ( GATS ) in 2011.

Furthermore, cigarettes have become the second biggest household expense in both urban and rural families after rice, according to a 2015 survey from the Central Statistics Agency ( BPS ).

While there has yet to be a study on how many children’s educations are sacrificed because of their parents’ smoking habit, there are many real-life anecdotes.

One instance is the case of a fisherman in Muara Angke, North Jakarta, whose two children dropped out of school because their father’s daily income of Rp 50,000 went to four packs of cigarettes per day, according to National Commission on Tobacco Control commissioner Fuad Baradja.

Nila said that Indonesian children stayed an average of 8.3 years in school, further indicating that high cigarette consumption ate up money that could have been spent on other necessities.

“While there could be many reasons that children drop out of school, one of them might be because the parents are not focusing enough on funding their children’s education. Even though the government has provided financial assistance for education, why is it only eight years?” she said.

There are countless other intangible costs of smoking, which are often easily forgotten.

“If a father is smoking inside his house and his daughter is having respiratory problems because of that, just count the cost incurred from the days when she has to skip school. What about medicine for her? And the father might also have to leave work to take his daughter to the doctor,” said Nila. ( bbn )

US$240m tobacco passes through auction floors

A TOTAL of 83,5 million kilogrammes valued at US$239,8 million has been sold as at day 37, official figures from the Tobacco Marketing Board (Timb) show.

http://www.theindependent.co.zw/2016/05/27/us240m-tobacco-passes-auction-floors/

During the same period last year, 61,6 million kg worth US$175,6 million were sold representing a 37% increase in tobacco earnings.

The average tobacco price per kg as of day 37 was pegged at US$2,87 up from US$2,85 sold last year.

At least 16,5 million kg of tobacco valued at US$40,9 million was sold at auction floors while 67 million kg worth US$198,8 million was traded at contract floors.

The highest price per kg offered at contract floors was US$6,25 while auction floors offered US$4,99.

Monetary authorities this year moved to compel all tobacco farmers to open bank accounts in a bid to promote financial inclusion, but delays in processing the transactions caused problems at the auction floors.

Compounded by the cash crisis, farmers mostly from rural areas are going for days before receiving their money upon delivering their crop.

Two weeks ago, tempers flared at the auction floors as farmers protested against the Reserve Bank of Zimbabwe’s decision to cap the maximum withdrawal at US$1 000 per day.

This year, the number of tobacco growers plunged by 22% from 92 430 last season to 71 728 after farmers failed to raise money for inputs due to poor prices. Production this year is projected to dwindle to 170 million kg from 199 million kg recorded last year.

Golden leaf farming evolved after the land reform programme into a broadbased income generator, bringing a ray of hope for most unemployed rural people to become a new face of economic salvation as 47 000 small-scale farmers ditched other crops preferring the cash crop especially after dollarisation.

Tobacco production reached a record high of 236,13 million kg in 2000. It then declined to new lows of 44,9 million kg in 2008 after the country embarked on the land reform programme in February 2000.

In 2010, production was 58,5 million kg before surging to 123,5 million kg in 2011 and growing further to 132,5 million kg in 2012. In 2013, 144 million kg was produced. In 2014, the country’s production grew to 216 million kg before dropping to 199 million last year.

With Brazil, India and Tanzania having downsized their tobacco production this year, it is estimated that global demand for the golden leaf will increase.

Smoking Behavior and Healthcare Expenditure in the United States, 1992– 2009

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