Cutting quit-smoking benefits — a business 101 review

By Dr. Erik Steele,
Posted Aug. 30, 2012, at 12:24 p.m.

Maine is a place where the state government has committed itself to run as though it was a good business. So when it announced it was proposing to cut funds that help Maine Medicaid patients to quit smoking in order to save state Medicaid dollars, I thought I would set aside the fact it is a bad health care decision and try to make the business case for the proposed cut.

On the face of it, the first part of the business case is simple. Cut Maine Medicaid (MaineCare) payment for smoking cessation treatment and save the state $400,000 annually in taxpayer dollars. That helps reduce Maine’s short-term state budget costs, which cannot be covered by current tax revenues. Again, lousy patient care move, but I understand the need to save money.

The problem is the bill for that decision is coming right back at us, in the near term, and it is going to be a much bigger bill than the $400,000 saved. That’s because investing in smoking cessation help for Medicaid patients saves money in the near term, in prevented heart attacks and other illnesses. While the federal government might allow MaineCare to bail out of smoking cessation coverage for poor Mainers, it is unlikely to allow it to bail out of heart attack coverage. When those patients show up clutching their chests, you and are going to have to pay.

No other state in America has cut these benefits, but other states have studied this question. Massachusetts found that, within little more than a year after a dollar was invested in smoking cessation programs for its Medicaid recipients, the state saved taxpayers $3.12 in reduced admissions to hospitals for heart problems caused in part by smoking. It spent an average of $183 for each Medicaid patient who participated in the program, and saved taxpayers an average of $571 per participant in hospital costs. This experience is consistent with studies elsewhere that have shown good returns on investment in smoking cessation programs.

Maine government’s proposal to cut $400,000 will lose it about $800,000 in matching federal dollars, removing about $1.2 million annually from statewide efforts to reduce smoking among MaineCare patients. Assuming Maine’s experience is similar to Massachusetts’, that $1.2 million invested annually in smoking cessation and thereby disease prevention might save Maine and national taxpayers about $3.6 million annually in hospital expenses (oh, and prevent untold misery for patients and their families).

Let’s be conservative and estimate that annual savings is only $2 million. That means we are saving $400,000 annually for Maine taxpayers, but then passing on to them and other Americans an extra $2 million in additional state and federal tax costs. How does that make any kind of business sense?

One could argue — and state government representatives have — that those MaineCare patients can go elsewhere for help with smoking cessation treatment costs, and that’s true. But there are far too many smokers in Maine for those other programs to absorb MaineCare’s share of the patients, and none has enough money to replace $1.2 million lost to the treatment of Maine’s second-most dangerous addiction (No. 1 is our addiction to our couches). There is simply no way to add up alternatives to anything but a huge net loss in smoking illness prevention investment in Maine.

In addition, those smokers on MaineCare who quit with MaineCare’s help might then not be smoking when they get jobs in Maine businesses with insurance benefits (virtually all of which cover smoking cessation treatments because it makes sound business sense to do so). Failure to treat them when they are on MaineCare punts their problem — and their higher health insurance costs — to Maine businesses, which can hardly afford those costs.

Maine’s government must get permission from the federal government to make this change, and the feds should turn Maine’s Medicaid managers down. The real “no way” answer, however, should come from the taxpayers and legislators of Maine unless the state can explain how saving money today that will have to be paid back twice over is the kind of business for which Maine is now open.

Erik Steele, a physician in Bangor, is chief medical officer of Eastern Maine Healthcare Systems.

 

http://bangordailynews.com/2012/08/30/health/cutting-quit-smoking-benefits-a-business-101-review/ printed on December 18, 2014