States Use Only Fraction of Tobacco Revenues to Fight Smoking, Study Finds
THURSDAY May 24, 2012 -- Only a small percentage of the billions of dollars states take in from tobacco revenues goes to anti-smoking efforts, a new federal report finds.
Under the 1998 Tobacco Master Settlement Agreement, tobacco companies agreed to reimburse states for Medicaid costs related to tobacco use. According to background information in the new study, the intent of the agreement was to use the money to also help prevent youth smoking, although there was no stipulation that this must happen.
However, the new study finds that between 1998 and 2010, states collected a combined total of almost $244 billion in tobacco industry settlement payments and cigarette excise taxes, but have invested only about $8 billion in effective state anti-smoking, tobacco control programs.
The remainder of the money has been used to pay general expenses or to fund programs other than tobacco control, according to research led by John Francis of the National Center for Chronic Disease Prevention and Health Promotion, part of the Centers for Disease Control and Prevention.
If states had followed the CDC's published guidelines on using the funds, they would have invested more than $29 billion in tobacco control programs during that time, the researchers said.
The researchers noted that although total state and federal investment in state tobacco control efforts did rise between 1998 and 2002, state investments in tobacco control have actually fallen steadily every year since.
Currently many states face substantial cuts and near-elimination of tobacco control program funding, the study authors warned.
The CDC guidelines initially recommended that states invest a combined $1.6 billion to $4.2 billion a year in tobacco prevention programs and in 2007 the agency updated that recommendation to $3.7 billion.
For the entire study period, the ratio of state tobacco revenues to state and federal tobacco control programs was about 30 to 1 (aproximately $244 billion in revenue compared to $8 billion in expenditures on tobacco control). In 2010, that gap had grown to approximately 37 to 1 ($240 billion vs. $640 million), the researchers said.
The study also found that by 2010, states were using only 2.4 percent of their tobacco revenues for tobacco control.
"The results of this analysis show an increasing gap between state investments in tobacco control and best practices recommendations," the researchers wrote. "Although all states derive revenues from cigarette excise taxes, few states have a statutory requirement requiring that a portion of these revenues be dedicated to tobacco control and prevention.
"Instead, most cigarette tax revenues are being used for general purposes. In addition, although state cigarette excise taxes have increased nationally, the Institute of Medicine has noted that recent tax increases largely have come in response to shortfalls in state budgets rather than as initiatives to increase spending on tobacco control."
The study appears in the May 25 issue of the CDC journal Morbidity and Mortality Weekly Report.
Responding to the report, Dr. Donna Shelley, an associate professor of medicine at New York University, said: "The tobacco control community has been advocating for years, unsuccessfully, to earmark even 5 cents for every dollar of tobacco tax collected, for implementing CDC recommended programs and policies. With tight budgets the problem has only gotten worse."
"However, there is no better return on investment in terms of public health benefit than funding the full spectrum of policies, media and other tobacco control program components recommended by the CDC," she added. "New York state is a great example of what can be achieved when tobacco funding is maintained, albeit not at the CDC recommended levels. In New York we continue to see annual drops in smoking rates from 21.6 percent in 2003 to 15.5 percent in 2010."
The American Cancer Society offers a guide to quitting smoking.
Posted: May 2012