Indiana claims this policy will test whether a premium surcharge will convince smokers to quit, but evidence shows that, instead, it will likely reduce the number of people who sign up for coverage . Bethesda, MD 20894, Web Policies , University of Southern California, She is a frequent writer and speaker on health and wellness law topics, and has presented for national organizations such as WELCOA, National Wellness Conference, HPLive, Healthstat University, and HERO. Jay Inslee (D) on April 5, 2019, Washington's tobacco age restriction was set to increase from 18 to 21 on January 1, 2020. You may switch to Article in classic view. Specifically, the employer, a casino, imposed a $50/month tobacco surcharge on health insurance on employees who used tobacco. We then took the mean of the median surcharge across all rating areas in the state weighted by the population of the rating area age 2064. This allows us to account for whether the effect is concentrated in the nongroup market or whether there are spillover effects. State government tax collections by source, State spending by function as a percent of total expenditures, Financial regulation in the United States, Education statistics in the United States. The site is secure. Tobacco age restrictions can take the form of limits on the sale of tobacco by age, limits on tobacco possession by age, or a combination of the two. Although the majority of states do allow insurers to impose tobacco surcharges of up to 50%, many insurers choose to use smaller surcharges or skip them altogether. 41. and state law. New York and Vermont are the two states where health insurance premiums are not based on age. 17117 individuals opened the survey, and 1034 qualified for and completed the survey. Employers that are ALEs (i.e., have 50 or more full-time equivalent employees . Among states that allowed a tobacco surcharge, we also examined the effect of the surcharge size on enrollment, again comparing smokers to nonsmokers. In addition, the complaint alleges that even when the employer offered a reasonable alternative standard (i.e., a smoking cessation program), the employer did not provide employees the full reward once they completed the program. Pesko MF, Maclean JC, Kaplan CM, Hill SC. Thank you. 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. If people avoid health insurance simply because they cant afford it, then they will also not able to access the coverage for the free tobacco cessation that is included with ACA-compliant health plans. Tobacco attestation is the section of the enrollment process for the State Health Plan that asks a question about tobacco use. The surcharges are extra costs that have been added to PEBB benefit eligible WSU employees' standard monthly medical premiums, effective July 1, 2014. We measured individual and household characteristics to be used as covariates in our regression models from CPSASEC. sharing sensitive information, make sure youre on a federal 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. Tobacco Surcharges - Legal Rules Research: Josh Altic . 2. 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. Department of Economics, This is due to a "tobacco surcharge". Other important reasons for not enrolling included not knowing about the marketplaces and/or not knowing how to enroll (19% main reason, 29% a factor), believing they were not eligible (8% main reason, 16% a factor), coverage not meeting needs including provider networks or benefits (3% main reason, 14% a factor), not needing health insurance (8% main reason, 11% a factor), or missing the enrollment period (4% main reason, 8% a factor). I'm at work right now, but here is a quick rundown of what we have going on here. It is vital to note individuals cannot use their premium subsidies to cover the tobacco surcharge that is generally used by the majority of the enrollees to reduce their monthly premiums. Thus, perhaps somewhat counterintuitively, eliminating or limiting surcharges could potentially lead to an increase in quitting. 3 Michael F. Pesko, Georgia State University. However, our models adjusted for other state policies that may affect insurance enrollment and tobacco use. 28 In the CPSTUS, smoking status was defined based on how frequently individuals report smoking. Thirty-eight states also have laws in place setting the tobacco age restriction to 21. Youth access to tobacco law-RCW 70.155: Prohibits the sale and distribution of tobacco products to minors. Before 24 In the 37 states that use the federal insurance exchange, healthcare.gov, the tobacco surcharge was paid by about 7 percent of 5.1 million consumers who enrolled, according to federal data. Company employs a couple thousand in the US PROOF OF AGE MAY BE REQUIRED FOR PURCHASE. A $25 tobacco use premium surcharge is required in addition to your medical plan premium if you or a dependent (age 13 and older) enrolled on your PEBB medical uses a tobacco product. The health law also makes clear that financial help. During plan year 2013, Macys included a notice within the Tobacco Affidavit alerting the employee to the availability of a reasonable alternative standard, so it satisfied the notice requirement. The program may include a tobacco surcharge to help motivate employees. , 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. Critics of surcharge policies point to data from other health-contingent premium programs showing that they fail to change individuals' behavior. 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. Table TableA2:A2: AppendixS1 presents results from these regressions separately for the 2015 and 2019 samples. This option wouldn't change the amount of the federal premium tax credit, a move foreclosed by federal law. , States that prohibit tobacco surcharges completely are California, Massachusetts, New Jersey, New York, Rhode Island, Vermont, and Washington, D.C. Connecticut also prohibits tobacco surcharges, but only for health plans sold in the state's health insurance exchange (Access Health CT). Finally, we gathered data on tobacco surcharges from the CMS Health Insurance Exchange Public Use Files for 2015 and 2019. The Office on Smoking and Health conducts and supports national and international surveys on tobacco use, smoking cessation, secondhand smoke exposure, and other tobacco-related topics among youth, adults and specific populations. The state lowered the age of majority, which also served as a tobacco age restriction at the time, from 21 to 19 in 1976. The surcharge is an extra charge on your health plan if you're a tobacco user or for those who don't partake, they may receive a discount. More specifically, our results show that tobacco surcharges have a large negative impact on enrollment in nongroup plans sold on the ACA marketplaces among those without insurance through an employer or public program. The .gov means its official. The American Cancer Society opposed the tobacco rating provision during the congressional debate about the health-care law. A new study by researchers at the Yale School of Public Health reveals an unexpected consequence of the Affordable Care Act's (ACA) tobacco surcharges: High surcharges resulted in lower rates of insurance enrollment among smokers in the first year of the ACA's implementation, without increasing smoking cessation. Alternatively, a state may require that the tobacco use surcharge be calculated as a share of the consumer's subsidized premium (instead of from the unsubsidized price, as under the default rules). In order to examine health insurance enrollment by tobacco use, we linked data from both CPSASEC and CPSTUS. The "tobacco surcharge" won't be offset by federal tax credits, hitting smokers with a double whammy. Mokdad AH, Marks JS, Stroup DF, Gerberding JL. Public insurance includes Medicare, Medicaid, VA, CHAMPUS, Tricare, and Indian Health Service. Download our quit-smoking calendar and tip sheet for creative ideas on how and when to promote quitting tobacco to maximize engagement. Theoretically, surcharges could also lead to reduction in smoking by imposing a financial penalty for the behavior. However, organizations like the American Cancer Society and the American Lung Association believe that higher health insurance premiums for tobacco users make health coverage less accessible to people using tobacco. Setting up a tobacco surcharge may seem straight forward but for it to be effective, you need to be strategic. there is yet little evidence that insurance surcharges lead to changes in tobacco use. affordable care act, enrollment, health insurance, marketplace, premiums, smoking, tobacco surcharge, Reasons for not enrolling in marketplace coverage. We also excluded children under 19 who did not participate in the CPSTUS and who qualify for Medicaid/CHIP at higher income thresholds than adults. By 1920, 46 states had implemented an age limit for tobacco sales, of which 14 set the limit at 21. Family Size The health insurance premiums of a family is determined based on every person in the family. These data were only available for the 38 states that participated in the federal exchange. and quitting smoking can significantly improve health outcomes. Overall, this study found that tobacco surcharges led to significantly lower enrollment in nongroup health insurance among smokers. 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. Respondents also listed tobacco surcharges as a major factor. If the program uses a medical test to detect nicotine or tobacco use, it also must comply with the ADA's rules for voluntary wellness plans. The University of Southern California Institutional Review Board approved the survey data collection and deemed the analysis of data from the CPS as exempt from full review, and the relevant part of the survey questionnaire is included in Appendix S2. And in states like California, Rhode Island, Vermont, the District of Columbia, Massachusetts, New York, and New Jersey are not allowed to charge higher premiums from tobacco users. Call KT, Davidson G, Sommers AS, Feldman R, Farseth P, Rockwood T. Uncovering the missing Medicaid cases and assessing their bias for estimates of the uninsured, The uninsured and the affordability of health insurance coverage: examining subgroups of uninsured Americans uncovers certain patterns of coverage gaps, but affordability remains a key concern, Response error and the Medicaid undercount in the current population survey, Tobacco product use among adultsUnited States, 20122013, Selfidentified tobacco use and harm perceptions among US youth, Individual Market Rate Restrictions (Not Applicable to HIPAA Eligible Individuals), Survey of NonGroup Health Insurance Enrollees, Health Insurance Exchanges 2020 Open Enrollment Report, Demand for health insurance marketplace plans was highly elastic in 20142015, Premium subsidies, the mandate, and Medicaid expansion: coverage effects of the Affordable Care Act, Demand for health insurance: evidence from the California and Washington ACA exchanges. Under the Affordable Care Act (ACA), group health plans (and self-insured employers) can charge tobacco users up to 50% more for their health insurance premiums than non-tobacco users, and when they do this it is called a tobacco surcharge. Click here to contact us for media inquiries, and please donate here to support our continued expansion. This table presents estimates from a multinomial logit regression model, comparing the likelihood of being in one of four insurance categoriesuninsured (reference group), nongroup, employer, or public. It is worth noting that the relative risk ratio for the interaction term was marginally significant for employer sponsored health insurance. Principal findings: Marketplace Premiums Rise Faster For Tobacco Users Because Of Subsidy Design. USA. Colorado limits the tobacco surcharge to 15%. For purposes of the premium surcharge, "tobacco use" is defined as: . Some states have made it illegal for insurance companies to implement a surcharge. 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