WASHINGTON - Smokers - and chewers - in some states may have to pay as much as 50% more in premiums than non-smokers if they sign up for insurance through state health exchanges that open next month, according to provisions in the Affordable Care Act.
Because smokers incur more health costs than non-smokers, supporters of the rule say, it makes sense for them to pay for the higher costs. If tobacco users have to pay higher fees, their argument goes, they may be more apt to quit.
For example, a 25-year-old single man might be charged a premium of $150 a month, but if he's a smoker, that could go up an extra $75 a month. Older people, who can be charged as much as three times more as young people, could be hit much harder if states choose to enact the new smoking rule.
Opponents of the rule argue that smoking is an addiction that can't be ended through punishment and that smokers need insurance because of their health issues. Also, they say, there is no proof that higher costs for insurance cause smokers to quit.
Forty-four states already allow insurers to charge extra for smokers, including for chronic health conditions, said Alwyn Cassil, a spokeswoman for the Center for Studying Health System Change. However, higher fees for chronic conditions will no longer be legal after Jan. 1 because the 2010 health care law forbids insurers from charging higher rates for such conditions.
That means, Cassil said, that smokers with chronic conditions will at least save money because they won't have to pay higher premiums for having health problems even if they have to pay a penalty for using tobacco.
"While it's not the best situation, it's going to be a heck of a lot better than it was before," she said. "It may be that they're priced out now."
Tobacco users can quit, said Cassil, a former smoker. Their health immediately improves when they do, she said, and if they don't quit, premiums for everyone else rise because so many smokers end up with chronic health conditions, such as lung disease or cancer.
"The reality is these people are at risk to having higher costs because they engage in an unhealthy behavior," she said. "This was done to try to keep insurance affordable for as many people as possible."
The federal exchange, which includes 26 states, will be using the tobacco penalty, said Linda Blumberg, who focuses on health insurance research at the Urban Institute, though eight states have decided not to use it. State exchanges may also decide to charge a lower-than-50% surcharge. Through the Affordable Care Act, the extra tobacco cost is not eligible for the subsidies that low-income policyholders can receive to help them pay for insurance, she said.
The penalties will hit some groups harder than others, said Georges Benjamin, executive director at the American Public Health Association, a public health advocacy group.
"Tobacco disproportionately targets low-income communities," Benjamin said. "They are also more likely to die prematurely for tobacco-related conditions."
That means low-income people may be taking a harder financial hit when they may need more help, especially if they are dealing with conditions such as chronic obstructive pulmonary disease or lung cancer, he said.
Instead of penalizing smokers financially, states should provide therapy to help them quit, Benjamin said. "Incentivize? Addictions don't work like that."
The American Lung Association also opposes tobacco surcharges, said Jennifer Singleterry, the group's manager of lung health policy. "We believe smokers should be helped to quit, but not punished for not doing so," she said.
The surcharge could cost people hundreds or even thousands of dollars more, depending on a person's policy and if they are already being charged more for age, she said.
"People don't usually quit when they're forced to," she said. "They quit when they're ready."
Singleterry said she also worries that smokers' family members, who have higher rates of asthma and other health issues, would also go without care.
According to the Centers for Disease Control and Prevention, 29% of adults with incomes below the federal poverty level smoke, compared with 18% of those above the poverty level. According to the American Lung Association, 32% of the uninsured - or those most likely to purchase insurance from the new exchanges - smoke.
Health insurance plans follow the recommendations of the U.S. Preventive Services Task Force when setting surcharges, said Clare Krusing, spokeswoman for America's Health Insurance Plans (AHIP), an industry trade group.
"In terms of the rating, costs are higher for smokers, and that should be reflected in the premiums," she said.
A recent Ohio State University study found that businesses pay almost $6,000 more per year per employee who smokes compared with a non-smoker, Krusing said.
"Ultimately, these are individuals who do choose to smoke," she said, adding that AHIP supported the smoking provision in the Affordable Care Act.
Smokers can avoid the surcharge by enrolling in a tobacco-cessation program, which insurers must offer if they have a smoking surcharge, according to the Affordable Care Act. And most insurers don't charge 50% in states that allow surcharges now, according to Mathematica, a research policy group that funds the Center for Studying Health System Change. Some employers already charge surcharges for employees who smoke because of a provision in the Affordable Care Act.
The American Lung Association is offering certified counselors to help smokers make decisions about insurance through the exchanges. The number is 1-800-LUNG-USA.