and quitting smoking can significantly improve health outcomes. However, our models adjusted for other state policies that may affect insurance enrollment and tobacco use. The nationwide average pre-subsidy premium in 2020 is about $576 per month for health plans sold in the exchange. Most states, however, follow the federal law and allow insurers to impose tobacco surcharges of up to 50% but employer wellness programs must follow certain rules for those surcharges to be legal. Additionally, tobacco surcharges function to increase the cost of health insurance for smokers, which was the most commonly cited reason for not choosing to enroll in a nongroup plan. 2014 Aug;33(8):1466-73. doi: 10.1377/hlthaff.2013.1338. Plan members need to attest to their tobacco status in their Virgin Pulse portal by May 31, 2022. Instead, the employer gave employees only two options: 1) dont use tobacco and avoid the surcharge; or. Number of schools by school type in the U.S. Demographic information for all students in the United States, Public school system expenditures in the United States, Public school system revenues in the United States, Public school teacher salaries in the United States, Public high school dropout rates by state, Regulatory Adjusted Cohort Graduation Rate, Ballot access for presidential candidates, Ballot access for major and minor party candidates, List of political parties in the United States, Environmental policy in the United States, Effect of the Affordable Care Act by state, Ken Carbullido, Vice President of Election Product and Technology Strategy, https://ballotpedia.org/wiki/index.php?title=Tobacco_regulations_by_state&oldid=8826370, Conflicts in school board elections, 2021-2022, Special Congressional elections (2023-2024), 2022 Congressional Competitiveness Report, State Executive Competitiveness Report, 2022, State Legislative Competitiveness Report, 2022, Partisanship in 2022 United States local elections. Thirty-eight states also have laws in place setting the tobacco age restriction to 21. Respondents also listed tobacco surcharges as a major factor. The table presents relative risk ratios from a differenceindifference specification similar to the one presented in Table2 and including all income levels. It has been more than a century since Utah's tobacco age restriction was last 18. We found that living in a surcharge state decreased the probability of enrolling in a nongroup plan by 13.3 percentage points (P<.01) among these individuals who are most likely to benefit from the marketplacesthose with incomes over 138% FPL who do not have insurance through their employer or a public program. Public insurance includes Medicare, Medicaid, VA, CHAMPUS, Tricare, and Indian Health Service. , Eight states increased their restrictions under a Democratic trifecta, four increased their restrictions under a Republican trifecta, and seven increased their restrictions under divided government. How Much Protected Are You After Being Vaccinated against COVID-19? The 2019 ASEC included variables that specifically identify marketplace coverage, so we examined whether the effect is driven by those with marketplace plans using the 2019 data only. We found that the likelihood of having insurance among smokers was 4.0 percentage points (P=.02) lower in surcharge states, while Friedman and coauthors found that enrollment was 4.3 percentage points lower in states with medium sized surcharges, compared to states without surcharges, although their estimate was not statistically significant. The survey included tobacco users age 1864 with incomes above 138% FPL who reported being uninsured or insured through a marketplace plan. , External Relations: Moira Delaney Hannah Nelson Caroline Presnell To be in full compliance with the ERISA wellness incentive rules, wellness programs that impose a tobacco surcharge on employees who use tobacco must pass a 5-factor test. Among other requirements, in order for a tobacco surcharge to be permissible, the employer must offer a reasonable alternative to obtaining the reduced premium. Federal government websites often end in .gov or .mil. Eliminating tobacco surcharges or substantially limiting them is an option that state policy makers may consider in order to increase health insurance coverage among this particularly vulnerable population. Data comes from a June 2019 online survey of tobacco users using Qualtrics Research Panel collected and analyzed by the authors. Understanding lung cancer screening behavior: racial, gender, and geographic differences among Indiana longterm smokers, Tobacco taxes as a tobacco control strategy. Company employs a couple thousand in the US 1 The tobacco surcharge is limited to 15% in Colorado, 20% in Arkansas, and 40% in Kentucky. Surveys. Although third parties helped administer the tobacco cessation program for Macys, Macys had ultimate control of the wellness program, including: Because of these alleged violations, the DOL is asking the court for the following relief (in relation to the wellness program violations): Also in November 2021, a federal district court in Missouri certified a class action of 1500 casino workers who alleged, similar to the Macys case, that their employer violated ERISA with its tobacco surcharge. Further, smokers without insurance through an employer or public program were 9.0 percentage points less likely (P<.01) to enroll in a nongroup plan if they were subject to a tobacco surcharge. States Vary on Higher Premiums Paid by Tobacco Users Under the ACA Kansas insurers applying up to 44 percent surcharge for tobacco users in 2015 11 Min Read Sep 09, 2015 By Linda J. Sheppard, J.D. Current federal law allows health insurance plans and companies to charge tobacco users an additional 20%. Theoretically, surcharges could also lead to reduction in smoking by imposing a financial penalty for the behavior. Column 1 shows the effect of tobacco surcharges on the differences in insurance rates between smokers and nonsmokers for the full sample of nonelderly adults. Download our quit-smoking calendar and tip sheet for creative ideas on how and when to promote quitting tobacco to maximize engagement. As of July 1, 2013, the excise tax imposed on cigarettes under M.G.L. Because tobacco surcharges are changing over time, this specification also allowed us to include state fixed effects. In other words, according to the plaintiffs, the employer did not give them a reasonable alternative standard, like a tobacco cessation program, to avoid the $50/month surcharge. Among the uninsured, respondents were asked to provide the main reason why they did not enroll in a marketplace plan from a list of options and then asked to check all reasons they did not enroll[Color figure can be viewed at wileyonlinelibrary.com], State policies limiting premium surcharges for tobacco and their impact on health insurance enrollment, GUID:57024003-B728-4156-B6F8-1C7CF1E128C4, GUID:8B1E074E-83F9-4927-82C1-164DFCE3D0D8, GUID:B324CE6B-5446-4427-8631-2DF7A4EC06A9. Access to insurance and health care may be particularly important for tobacco users because they are at higher risk of developing numerous chronic health conditions and because all health insurance plans are required to provide tobacco cessation as an essential health benefit with no outofpocket costs. CarterHarris L, Slaven JE Jr, Monahan PO, SheddSteele R, Hanna N, Rawl SM. This option wouldn't change the amount of the federal premium tax credit, a move foreclosed by federal law. Employees at several companies are pushing back on employer wellness programs that require higher health insurance premiums for tobacco users. However, it is the case only if they dont use tobacco but if they do use tobacco then the tobacco surcharge may result in unaffordable health insurance premiums for these people. the display of certain parts of an article in other eReaders. Thus, people who use tobacco are advised to not just avoid health insurance because many health insurers have implemented smaller surcharges or some have also sip them altogether. However, the Centers for Medicare and Medicaid Services has issued a subsequent rule that defines tobacco use as the use of any tobacco product within the last six months with a frequency of at least four times per week. In plan years 2011 and 2012, the program failed to offer employees a reasonable alternative standard and notice of that reasonable alternative standard. Macys offered a tobacco cessation program to employees, but the only way to avoid the surcharge was for the employee to declare that all covered members in his or her family remained tobacco free for a period of six consecutive months during the health plan year. We linked data from two components of the Current Population Survey-the 2015 and 2019 Annual Social and Economic Supplement and the Tobacco Use Supplement, which we combined with data on marketplace plan premiums. Table TableA1:A1: AppendixS1 presents summary statistics by insurance type separately for the 2015 and 2019 samples. Premium rating rules for nongroup insurance and small group plans (generally plans provided by employers with fewer than 50 employees) are similar. 4. 9 Those on employer health plans can avoid the surcharge by joining an employer based tobacco cessation program. Like the Macys case, this case is still pending. Tobacco use is the largest cause of preventable illness in the United States. Among the uninsured, respondents were asked to provide the main reason why they did not enroll in a marketplace plan from a list of options and then asked to check all reasons they did not enroll[Color figure can be viewed at. Due to a "ObamaCare smoking glitch" where programmers couldn't get the charge to calculate correctly the tobacco surcharge wasn't implemented until 2015 in many states. The Affordable care Act allows health insurers to charge a 1.5-to-1 ratio for tobacco use. To adjust for other potential differences across states, we controlled for Medicaid expansion status, the use of a statebased marketplace, tobacco taxes, and clean indoor air policies. Operations: Meghann Olshefski Mandy Morris Kelly Rindfleisch The most common options include (i) HSA, HRA or FSA contributions; (ii) a decrease in employee contributions toward medical coverage (often referred to as a tobacco surcharge); and (iii) cash, gift cards or entries into a prize drawing. Health Aff (Millwood). 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