May 11, 2005
A study Blue Cross and Blue Shield of Minnesota is releasing Wednesday says smoking was responsible for almost $2 billion in medical costs in 2002. The insurer's Center for Tobacco Reduction and Health Improvement also blames smoking for 5,689 deaths that year. The report is prompting calls for an increase in cigarette taxes to reduce smoking rates in the state.
St. Paul, Minn. — It's widely known that those who smoke are more likely to get sick from their habit. But Blue Cross and Blue Shield of Minnesota is presenting hard numbers to back up the perception. They say Minnesotans spent $2 billion on health care for smokers in 2002.
"Our report shows that tobacco use costs Minnesotans dearly," says Dr. Marc Manley, director of the Center for Tobacco Reduction and Health Improvement at Blue Cross and Blue Shield.
Manley says Blue Cross arrived at its bottom line by analyzing Minnesota's death records in 2002, and assessing the differences in health care costs for smokers and non-smokers. The report found that heart and lung diseases were the major causes of smoking-related deaths in Minnesota.
Manley says smokers should care about the findings because they'll pay more in health care costs and could die prematurely as a result of their habit. He says non-smokers should care because the problem will also hit them in the pocketbook by increased health insurance premiums. Manley says the solution to the problem is simple -- get people to stop smoking or convince them not to start.
"We know now the magnitude of the problem with the most recent figures, and we know one very important solution would be to raise the tax on cigarettes," says Manley.
Blue Cross and others have been lobbying for a cigarette tax increase at the state Capitol. They argue increasing the tobacco tax would reduce health care costs while providing needed revenue to the state's general fund.
The Campaign for Tobacco Free Kids estimates that 63,000 children and teenagers would either quit or never start smoking if the tax went up $1 per pack. Patrick Wright is a pulmonologist at the Minnesota Lung Center and is a member of the Minnesota Medical Association. He says he'd be happy to see a drop in business if smoking rates declined.
"As a lung specialist, I see people with emphysema, I see people with lung cancer, I see people with asthma. It's a broad spectrum from young to old," says Wright. "And on top of that we see people with heart disease and urinary cancers. There's a lot of things out there that are attributable to cigarette smoking, and they're very expensive."
Wright says the MMA is among the organizations pushing for a $1 per pack increase to the tobacco tax. Minnesota's 48 cent-a-pack tax is currently 37th highest among the states. Raising it $1 would make it ninth highest.
Sen. Sheila Kiscaden, IP-Rochester, supports the increase. She says the increase would generate $214 million in new revenue for the state.
"It's kind of odd to be gung ho about a particular tax. But I think the evidence is there that this tax produces revenue that the state needs, but more importantly has a very positive health benefit," says Kiscaden.
The main obstacle to a higher tobacco tax is Gov. Pawlenty. He says he won't sign a tobacco tax increase unless lawmakers reduce taxes elsewhere by an equal amount.
"If it's simply fashioned as a tax then I'm not for that. If there's some way to at least consider health impacts and smoking in a way that correlates the cost, and it's limited to that system, I'd at least be willing to have the discussion -- but not if it's a tax," says Pawlenty.
Supporters of a tobacco tax increase are hopeful that a legislative stalemate could prompt lawmakers to consider a tobacco tax increase. Senate DFLers have proposed a budget that increases income taxes on the state's wealthiest people. House Republicans have proposed a budget that cuts health care and relies in part on a state sponsored casino.
Rep. Jim Abeler, R-Anoka, is hopeful that Pawlenty and others could be persuaded that increasing a cigarette tax is a good compromise. Abeler says you could argue the tobacco tax is a user fee, rather than a general tax.
"I think in the pragmatic way with the end game here, a lot of taxes aren't allowed to be raised based upon the rules that we're operating under, it might be one of the few options available to us that has real money. It would be a cigarette fee, not a tax, of course," says Abeler.
Blue Cross hopes that other state lawmakers will agree with Abeler. They're making a final pitch before the deadline for adjournment on May 23.