A tobacco cessation benefit can reduce future medical costs.
TOBACCO USE REMAINS the leading cause of preventable death in the United States, killing one in five people each year, and costing more than $193 billion annually-including $96 billion in healthcare expenditures.
Although the rate has been steadily declining, 20% of Americans still smoke. Surveys show that most smokers want to quit. About 69% say they want to quit, and 52% have made a quit attempt in the last year, according to the Centers for Disease Control and Prevention (CDC).
“The health benefits of quitting are enormous-literally adding years to your life,” says Brian Hickey, director of federal government relations at the Campaign for Tobacco-Free Kids, a not-for-profit advocacy organization.
Progress has been made in tobacco legislation. In 2009, President Obama signed the Family Smoking Prevention and Tobacco Control Act giving the Food and Drug Administration (FDA) regulation over tobacco products. For the first time, a public health regulatory agency has oversight authority for tobacco products.
The Patient Protection and Affordable Care Act (PPACA) also aims to make an impact on tobacco use. A number of provisions assist with smoking prevention and cessation at the federal, state and insurance levels. For example, non-grandfathered individual health plans are required to cover-with no cost sharing-recommended preventive services noted by the United States Preventive Task Force (USPTF), including tobacco cessation.
“That will have a great impact on enhancing access to the evidence-based tools found to effectively help tobacco users quit,” says Hickey. “Counseling as well as prescription and over-the-counter medications can improve success rates significantly.”
According to a guideline issued by the Department of Health and Human Services (HHS), a combination of counseling and medication can double a smoker’s chances of quitting.
Another provision of PPACA is the Prevention and Public Health Fund. It helped fund the CDC’s national media campaign, “Tips from Former Smokers,” the first federally funded, comprehensive anti-tobacco advertising effort. Costing $54 million, the campaign ran for 12 weeks in 2012, during which calls to quit lines increased by 132% and visits to smokefree.gov increased by 428%.
“Quitting rose considerably as the ads were being run across the country, and we expect that to happen again,” Hickey says. A second round of the campaign is projected to roll out this year.
SPENDING TO SAVE
Smokers incur an average of $16,000 to $17,000 more in lifetime medical expenses, according to a report by Bloomberg Government (2010).
The report also showed that paying for tobacco cessation treatment will cut costs for insurers after three years. Although benefit costs will surpass savings initially, smoking-related illness costs will decrease as net savings increase by the fourth and fifth year.
Similarly, a report by Lief and Associates for the Colorado Clinical Guidelines Collaborative (2012) showed that expenditures for smoking cessation programs in the range of $100 to $300 per smoker attempting to quit would be fully offset by cost savings in a typical commercial insured population.
Research by America’s Health Insurance Plans (AHIP) also showed clinical interventions to reduce smoking deliver a positive return on investment within two to three years for health plans and immediate savings for employers. Plans can determine the value of a one-year smoking cessation benefit by utilizing a calculator on AHIP’s Website.
PPACA will also limit the higher premium rates that can be charged for tobacco use in the individual market to a ratio of no more than 1.5 to 1. In 2014, plans will be able to charge smokers buying individual policies up to 50% higher premiums. Members of employer-sponsored plans who smoke will likely pay the group rate, with the possible exception of earning wellness incentives.
Jennifer Singleterry, manager of National Health Policy at the American Lung Assn. and author of the annual Helping Smokers Quit report, says that the American Lung Assn. opposes charging smokers higher premiums because they have not been proven to encourage smokers to quit.
“We know what works, and those are treatments,” she says. “Covering medications and counseling, environmental factors like increasing tobacco taxes, enacting smoke-free laws and funding tobacco-control programs encourage people to quit smoking.”
She says that states and insurance companies should focus on the proven, evidence-based tools rather than a policy to charge smokers more for their premiums. The rate band also has the potential to price smokers out of the system.
An uninsured tobacco user would not have access to treatments to help them quit, let alone access to treatment for tobacco-related diseases. According to the CDC, for every person that dies from a tobacco-related disease, there are 20 more people living with a tobacco-related disease-which is about 8.6 million people.
SETTING A STANDARD
According to a study of insurance contracts by Georgetown University (Nov. 26, 2012), federal and state regulators need to give insurers more detailed guidelines on what coverage is required under PPACA.
The study showed that policies were riddled with conflicting language that could confuse members on what treatments are covered and dissuade them from pursuing treatment. There were also significant gaps in coverage for cessation counseling and medication, as well as cost-sharing requirements that contradicted the law.
Because of these conflicts and gaps in coverage, establishing a federal Essential Health Benefit (EHB) is imperative, Singleterry says.
“We need consistency from the federal government and their guidance because it’s unclear what the standard actually means for insurers,” Singleterry says. “Plans are required to cover tobacco cessation as a preventive service, but there’s no definition beyond that.”
Smokers are often lower income and uninsured. Many will be among the population entering the health insurance system for the first time in 2014.
“It’s really important to have a set of standards so these smokers have access to the help they need to quit,” she says.
Authors of the Georgetown study recommend that regulators provide guidance on permissible and prohibited limitations to coverage under PPACA, as well as model contract language for tobacco cessation coverage to help address uncertainties.
Singleterry advises insurers to follow low-literacy level practices and maintain clarity and consistency in plan policies. For example, members might not know to check an exclusions list to see if a service is covered. Instead, she says, make sure coverage information is clearly stated and easy to find.
“Do an assessment of the information on what your plan covers for tobacco cessation-be comprehensive and align all the places that it’s discussed and focus on making the information easy to understand and easy to find-on Websites and in plan documents,” she says.
IT CAN WORK
In 2006, as part of Massachusetts healthcare reform, MassHealth-the state’s Medicaid plan-enacted a comprehensive tobacco cessation benefit for its members. The benefit covered seven FDA-approved medications for tobacco cessation and three types of counseling: individual, group and telephonic.
The plan’s efforts to promote the benefit to providers and consumers in the community resulted in participation. A 2010 study of the program showed that 37% of smokers had enrolled in the treatment program, and smoking rates among beneficiaries declined by 26% in the first 2.5 years.
The benefit also resulted in medical cost savings. MassHealth reported a 46% decrease in hospitalizations for heart attacks and a 49% decrease in hospitalizations for cardiovascular disease. Authors of the study estimate that for every $1 in program costs MassHealth saved $3.12.
“This is an example of what can happen when you have a comprehensive benefit,” Hickey says. “People will use it; they’ll quit in higher numbers when it’s available; and-even in the short term-it can save on medical costs.”
Thomas Land, director of the Office of Statistics and Evaluation at the Massachusetts Dept. of Public Health and lead author of the 2010 study says that recent, unpublished data on utilization suggests that more than half of MassHealth smokers use the benefit. Plans for state and local government employees have started to offer coverage similar to MassHealth’s benefit as well.
“On paper, these tobacco cessation programs look strong, but there are subtle barriers to access and use,” Land says. “We went from no tobacco benefit to a strong one literally overnight, and going from famine to feast may have created a demand wave.”
Although MassHealth’s cost-effectiveness data is compelling, Land says insurers may already have evidence in claims data demonstrating that medications and counseling can reduce the likelihood of cardiac events and hospitalizations, and reduce overall costs of care.
Not only will a comprehensive cessation benefit provide smokers with the proper evidence-based tools to help them quit, plans will see value in medical cost savings.
“This benefit should be universally available,” Land says. “It’s good business and good public health.” MHE