Smokers Could Save Medicaid System Around $10 Billion

A study "Saving Lives, Saving Money II" carried out by RTI International and funded by the American Legacy foundation, determined that Smokers on Medicaid could save the system about $10 Billion in five years, if they would quit smoking. The costs for the system could be cut by 5.6% through an effective smoking prevention and cessation program.

The study is an analysis of the costs to state Medicaid programs caused by young smokers over the course of their lives. It is an update to the American Legacy foundation's report "Saving Lives, Saving Money: Why States Should Invest in a Tobacco-Free Future" (2002).

The new report states Medicaid spending related to current smoking spans from $1.5 billion in the state of New York to $15 million in Wyoming. However, the cost of Medicaid could be, across all states, $9.7 billion less, if the smokers in the system would successfully quit smoking.

According to the study, if the now 24-year-olds could be prevented from all smoking through the remainder of their lives, Alaska and Vermont for example could save $1.4 million in Medicaid costs, Texas $125 million.

Furthermore, the report determined that female smokers cost the system more than male smokers; $1,372 compared to $6. 69% of the people on Medicaid are female.

Health policy makers should take note of this report. States already struggle to fund the costs of Medicaid, which will steadily increase in the future. 8.6 million Americans suffer from diseases caused by tobacco exposure. The leading cause of preventable deaths is tobacco. The U.S. Centers for Disease Control and Prevention (CDC) released information earlier this month indicating that after a seven year run of declining adult smoking rates, there now has been a stall in those rates for the second year in a row, with 45.3 million adults smokers reported in 2006. Even though the majority of smokers indicate they would like to quit smoking, only a small percentage is actually successful in the long-term. It is only logical that an investment in effective smoking prevention and cessation programs will save lives and yield better financial results in the sector of public health.

The American Legacy Foundation's goal is to create a world where anyone can quit smoking and young people reject smoking. The foundation is a result of the November 1998 Master Settlement Agreement (MSA) between the attorneys general of 46 states and five U.S. territories, and the tobacco industry.