Frustration abounds over tobacco settlement spending
Washington -- When it comes to discouraging words about what's become of anti-smoking dollars provided by the landmark 1998 tobacco settlement agreement, few could beat those of Cheryl G. Healton, DrPH, president and CEO of the American Legacy Foundation.
"History will view [the settlement] as a golden opportunity for public health that fell flat on its face," she said, pointing to what she views as minuscule contributions from most states in terms of funding for anti-smoking measures.
Addressing a National Health Policy Conference in Washington, D.C., last month, Dr. Healton bolstered her remarks with specifics about state allocations from the settlement for anti-smoking efforts.
Making the biggest effort this year is Maine, which allocated $12.7 million of its $15.2 million fiscal year 2003 settlement payment to smoking prevention efforts.
Maine is one of just four states that meet the minimum recommendations made by the Centers for Disease Control and Prevention. That number may soon drop to three as the governor of Maryland has proposed diverting half the state's current allocation to other uses.
Growing state budget woes are causing more and more legislatures to take this step, shifting their share of the $206 billion master settlement agreement to other needs. For example, Massachusetts' budget problems have resulted in its plunge from the No. 1 spot last year to No. 38 this year.
"The tragedy of the master settlement agreement was that there were no strings attached to the use of the money by the states," said Dr. Healton.
Other tobacco control advocates are quick to agree that the states' diversion of the funds is disappointing and discouraging.
Stan Glantz, PhD, a professor of medicine at the University of California, San Francisco, and a long-time anti-tobacco advocate, said the master settlement agreement "had the rug pulled out from under it."
Rather than use the money to take on the cigarette companies, state legislatures used the money for just about anything they could think of except the obvious use, which is doing something about smoking, said Dr. Glantz.
States are collecting a record $20.3 billion in tobacco-generated revenue in the current budget year, according to a new report by five public health organizations, but they have cut spending on smoking prevention and cessation programs by $86.2 million, or 11%.
Noting that not all available funds are generated by the settlement agreement, Matthew Myers, president of the Campaign for Tobacco-Free Kids, pointed out that tax revenues generated by tobacco products make up a large portion of those funds. Of the $20.3 billion collected by the states, more than half was from tobacco taxes, according to the report.
Myers also said that states are spending a great deal on tobacco prevention even though their use of the settlement funds is not what it should be. "In fiscal year 2003, the states will be spending about $700 million on tobacco prevention and cessation," he said. "It's important not to just look at the tobacco settlement funds as the sole source of funding for tobacco prevention and cessation."
Increased health costs
States that do gut their tobacco control programs are missing an opportunity to save money in health care costs, said Charlie Shaeffer, MD, a cardiologist in Rancho Mirage, Calif. "Heart attacks, bypass operations and hospitalizations are all very expensive and it would be useful to remind our government leaders that not only are they endangering the health of their citizens by not providing the support, but they are actually increasing health care costs and are missing an opportunity to save money."
The damage done when tobacco control programs were slashed in Massachusetts and California was called "public health malpractice," by Thomas Houston, MD, co-director of the SmokeLess States Initiative, a coalition led by the American Medical Association.
"Similar cuts across the country will make it very difficult for the health community to continue curbing the toll in lives and high health care costs taken by tobacco use," he said.
Particularly troubling to tobacco control advocates is the fact that 18 states and the District of Columbia have taken actions toward selling all or part of their future tobacco settlement payments to investors for a smaller up-front payment in a process called securitization.
California is about to sell $3 billion worth of bonds to investors but will be giving up $10 to $12 billion in future settlement agreement payments, noted Chris Bostic, policy analyst for the American Lung Assn. "Some states have already blown everything they are going to get for the next 25 years," said Bostic.