COLUMBIA, SC – Beginning in January of 2010, South Carolina will impose a $25 surcharge to state health plans and HMOs for state workers who smoke, joining seven other states that already impose tobacco surcharges.
“The point is to tie the cost of insurance more closely to behaviors that contribute to increased healthcare costs,” said Joel Sawyer, a spokesman for Gov. Mark Sanford.
According to the Centers for Disease Control and Prevention, 21.9 percent of South Carolinians smoke. Michael Sponhour, director of public affairs for the South Carolina Budget and Control Board, said the percentage of smokers among the state health plan’s members is “a good bit lower” because of its demographics.
“We estimate that tobacco-related healthcare claims accounted for about 7 percent – $75 million – of claims,” he said.
For the last two years South Carolina has provided free smoking cessation treatment – including free nicotine replacement – for any plan member. For the 3,289 people enrolled in the Free and Clear Program from Jan. 1, 2006, to July 31, 2008, the success rate was 44.7 percent, Sponhour said.
The next step is to tie behavior to healthcare cost, which Sawyer said the tobacco surcharge will accomplish.
Alabama, which has a tobacco surcharge, is contemplating adding a surcharge for state employees who are overweight.
America’s Health Insurance Plans (AHIP) “leaves it up to states to decide” how to approach changing members’ lifestyles that impact their healthcare, said Robert Zirkelbach, spokesman for AHIP.
He pointed out, however, that studies on voluntary wellness programs have delivered positive outcomes for members and their employer groups. The trend is to look for ways to positively impact member health, he said.
Employers and health plans are trying different strategies to encourage employees and members to change lifestyle behaviors associated with chronic conditions, said Lynne Dunbrack, program director for Health Industry Insights, an IDC company.
It’s “more palatable to offer carrots” in the form of discounts through wellness and prevention programs than add surcharges for unhealthy behavior, she said.
While disincentives exist, as in the cases of states that have state employee obesity and smoking surcharges to employees’ health insurance premiums, Dunbrack said it’s too early to determine which strategy will be ultimately more successful in the long run.