Study: Companies Pay Almost $6,000 Extra Per Year for Each Employee Who Smokes

Employers Can Use Cost Estimates to Develop Tobacco Policies

COLUMBUS, Ohio – A new study suggests that U.S. businesses pay almost $6,000 per year extra for each employee who smokes compared to the cost to employ a person who has never smoked cigarettes.
Researchers say the study is the first to take a comprehensive look at the financial burden for companies that employ smokers.
By drawing on previous research on the costs of absenteeism, lost productivity, smoke breaks and health care costs, the researchers developed an estimate that each employee who smokes costs an employer an average of $5,816 annually above the cost of a person who never smoked. These annual costs can range from $2,885 to $10,125, according to the research.
Smoke breaks accounted for the highest cost in lost productivity, followed by health-care expenses that exceed insurance costs for nonsmokers.
The analysis used studies that measured costs for private-sector employers, but the findings would likely apply in the public sector as well, said lead author Micah Berman, who will become an assistant professor of health services management and policy in The Ohio State University College of Public Health on Aug. 21. Berman began this work while on the law faculty of Capital University in Columbus.
“This research should help businesses make better informed decisions about their tobacco policies,” said Berman, who also will have an appointment in the Moritz College of Law at Ohio State. “We constructed our calculations such that individual employers can plug in their own expenses to get more accurate estimates of their own costs.”
The study focuses solely on economics and does not address ethical and privacy issues related to the adoption of workplace policies covering employee smoking. Increasingly, businesses have been adopting tobacco-related policies that include requiring smokers to pay premium surcharges for their health-care benefits or simply refusing to hire people who identify themselves as smokers.
The researchers acknowledge that providing smoking-cessation programs would be an added cost for employers.
“Employers should be understanding about how difficult it is to quit smoking and how much support is needed,” Berman said. “It’s definitely not just a cost issue, but employers should be informed about what the costs are when they are considering these policies.”
The research is published online in the journal Tobacco Control.
The Centers for Disease Control and Prevention (CDC) estimated a decade ago that productivity losses and medical costs amount to about $3,400 each year per smoker. However, the report looked at overall costs to the American economy from smoking-related deaths and did not try to identify those costs that would be borne by an employer, Berman noted.
The CDC says smoking accounts for nearly one in every five deaths – or about 443,000 – in the United States each year and increases the risk for such illnesses as coronary heart disease, stroke, lung cancer and other deadly lung illnesses.
The researchers used multiple studies that calculated a variety of specific costs to develop an estimate of the overall annual extra cost of each employee who smokes.
According to their annual estimates per smoker, excess absenteeism costs an average of $517 per year; “presenteeism,” or reduced productivity related to the effects of nicotine addiction, $462; smoke breaks, $3,077; and extra health care costs (for self-insured employers), $2,056.
The analysis also took into consideration a so-called death “benefit” in terms of economics. For employers who provide defined benefit plans, meaning they pay retirees a set amount in pension each year, a smoker’s early death could result in an annual cost reduction of an estimated $296. This occurs when smokers pay more into the pension system than they receive in retirement – in effect, subsidizing nonsmokers’ pensions because they live longer.
“We tried to be conservative in our estimates, and certainly the costs will vary by industry and by the type of employee,” Berman said. “Several of these estimates are based on hourly employees whose productivity can be tracked more easily.”
He noted that the analysis takes into account the known disparity in pay for smokers versus nonsmokers. In the calculations, smokers’ salaries were discounted by 15.6 percent to reflect their lower wages.
The researchers describe their findings as “needed factual context to discussions about workplace policies” intended to inform the debate over whether such policies should exist.
“Most of the places that have policies against hiring smokers are coming at it not just from a cost perspective but from a wellness perspective,” Berman said. “Many of these businesses make cessation programs available to their employees.
“Most people who smoke started when they were kids and the vast majority of them want to quit and are struggling to do so. This is a place where business interests and public health align. In addition to cutting costs, employers can help their employees lead healthier and longer lives by eliminating tobacco from the workplace.”
Co-authors of the study include Rob Crane of the College of Medicine and Eric Seiber of the College of Public Health, both at Ohio State, and Mehmet Munur of the Columbus law firm Tsibouris & Associates.

No Smoking Outside Starbucks Shops Starting Saturday

Starbucks is moving its smoking ban outdoors.
Starting Saturday, according to signs posted in its more than 7,000 shops across the U.S. and Canada, “the no-smoking policy … will include outdoor areas.”
“Smoking will be restricted within 25 feet of the store and within outdoor seating areas,” the notices read.
AdWeek says that “since smoking bans have swept the nation in the last decade, it’s doubtful there will be a huge backlash for the brand. In fact, there’s been an online movement from Starbucks consumers calling for the newly revealed policy since at least 2009.”
WJXT-TV in Jacksonville, Fla., which appears to have been first to notice the new policy, spoke to some customers at a Starbucks. It found split opinions:

“Meredith Robinson can’t wait. The non-smoker said the new rule allows her to enjoy the patio, too. ‘It makes for a better environment because a lot of people go to Starbucks and drink their coffee, too, especially on a pretty day like this,’ said Robinson.
“Long-time smoker Charli Dirani believes Starbucks will lose business under the policy by kicking people, like him, to their curb or even farther away. ‘I think for them to stop that is a conflict between the two,’ said Dirani. “Everybody knows coffee and cigarettes go hand-in-hand.’ ”

The news has the advocacy group Moms Demand Action for Gun Sense In America calling on Starbucks to also ban loaded guns from inside its stores.
http://www.npr.org/blogs/thetwo-way/2013/05/31/187532646/no-smoking-outside-starbucks-shops-starting-saturday

Letter: Cigarettes kill more than wars do

By: Jay Taylor, Durbin, N.D., INFORUM
As I write this, I’m looking at a Forum editorial reminding me to take time to honor the war dead, and in my heart and head, I do that. I’m writing this after Memorial Day as I would not want to take one bit of respect away from the brave soldiers who have defended our country.
I am writing this to honor one particular World War II veteran who served in Germany and came home with stories that he couldn’t even bear to tell until shortly before his death at the age of 56. The war couldn’t kill him; the memories couldn’t kill him; working six to seven days a week couldn’t kill him. Cigarettes did! He was tough but not tough enough. He died from his addiction to smoking cigarettes. So as we honor those who fought for our country’s freedom, let’s take a moment to honor those who fought addictions fed by serving in the military, among other places.
Cigarettes and tobacco products are killing more people than wars ever could. Let’s fight that battle, too.
http://www.inforum.com/event/article/id/401383/

Minnesota stores face loss of revenue after cigarette tax hike

MOORHEAD – The Legislature gave Josh Larson a huge incentive to quit smoking.
 
“I am currently working on that,” said Larson, store manager at Oasis Convenience store in north Moorhead.
His timing couldn’t be better. The Minnesota Legislature recently raised taxes on cigarettes $1.60 a pack, bringing state taxes to $2.52 per pack.
Larson said he’s not the only smoker he knows who is thinking of quitting. He said many of his friends plan to quit because the taxes have made a pack so expensive on this side of the Red River.
“I think people will definitely go into Fargo to buy cartons,” said Larson, adding that the tax will very likely cut into the Oasis’ cigarette sales. “The ones that are serious smokers, they’ll buy them every once in a while.”
The increase in cigarette taxes has convenience store owners in Moorhead worried that most of their customers will stop at Fargo convenience stores, said Chuck Chadwick, executive director of the Moorhead Business Association.
North Dakota hasn’t raised its taxes on cigarettes since 1993, where the state tax is 44 cents per pack.
“The devastating piece is, once the traffic patterns change … it’s really difficult to break a customer’s habits,” Chadwick said.
Convenience stores already operate on low margins, Chadwick said, and with the loss of customer traffic, stores won’t only lose the money from cigarette sales, which is a relatively small percentage of their overall sales. They will also lose impulse buys that go with cigarettes – coffee, sodas, candy and other incidentals customers bring to the counter with their smokes, he said.
Bobbi Orona, assistant manager at the Holiday Station in north Moorhead, said her boss isn’t looking forward to the increased cigarette tax.
“A lot of our regular customers – over half – are smokers,” she said.
Orona said she’s been hearing a lot of complaints recently, first about high gas prices and now about the cost of a pack of cigarettes.
A single pack of Marlboros at the Holiday will set you back about $7, Orona said.
At the Oasis, Larson said he thinks business will be saved by the fact that they’re one of the few stores around to sell bait. There are also the scratch-off lottery tickets, which he describes as the store’s No. 1 selling item.
Larson’s bigger concern these days is figuring out how to continue selling cigarettes at the same time he’s trying to quit.
https://secure.forumcomm.com/?publisher_ID=1&article_id=401163&a1=03851cc56021740ba1cba668f42ea91d&b1=ceebe76a67dd30f3a1451c00a89f6cf8&CFID=366614428&CFTOKEN=99736079

Minnesota Tobacco Tax Increase is Big Win for Kids and Health

Statement of Matthew L. Myers President, Campaign for Tobacco-Free Kids

WASHINGTON, DC — It is terrific news for Minnesota’s kids and health that the Legislature has voted to increase the state cigarette tax by $1.60 per pack and also increase the tax on other tobacco products. The tobacco tax increase is truly a win-win-win solution for Minnesota — a health win that will reduce tobacco use and save lives, a financial win that will help to balance the state budget and fund essential programs, and a political win that polls show is popular with voters. We look forward to Governor Mark Dayton signing this legislation into law.
We applaud Governor Dayton and legislative leaders for siding with kids over the tobacco industry by supporting the tobacco tax increase. We also congratulate the Raise It for Health Coalition that has fought tirelessly to reduce tobacco use and save lives in Minnesota.
The evidence is clear that increasing the cigarette tax is one of the most effective ways to reduce smoking, especially among kids. Studies show that every 10 percent increase in the price of cigarettes reduces youth smoking by about 6.5 percent and overall cigarette consumption by about 4 percent. Minnesota can expect the $1.60 cigarette tax increase will:

  • Prevent more than 47,700 Minnesota kids from becoming smokers
  • Spur more than 36,600 current adult smokers to quit
  • Save more than 25,700 Minnesota residents from premature, smoking-caused deaths
  • Save more than $1.65 billion in future health care costs.

The state projects that the $1.60 cigarette tax increase and increased taxes on other tobacco products will raise $434 million in new revenue over the next two years (fiscal years 2014-15).
Tobacco use is the leading preventable cause of death and disease in Minnesota, claiming 5,500 lives each year and costing the state $2 billion annually in health care bills. While Minnesota has made significant progress in reducing youth smoking, 18 percent of high school students still smoke and 6,800 more kids become regular smokers every year.
With Minnesota’s increase to $2.83 per pack, the average state cigarette tax will be $1.51 per pack. We call on states across the nation to significantly increase the tobacco tax to reduce tobacco use and its devastating health and financial toll.
http://www.tobaccofreekids.org/press_releases/post/2013_05_21_minnesota

Smoking banned on Bismarck’s playgrounds

BISMARCK, N.D. – In a 5-0 vote on Thursday, the Bismarck Park Board took swift action to ban smoking on the 44 playgrounds and play areas it manages. People must step 20 feet away from the playground before they light up.
Alecia Uhde, chairwoman of the Go! Bismarck Mandan coalition, said she made the request as part of the group’s goal to improve the health, fitness and quality of life for people.
“One of those (goals) was to increase the number of tobacco-free designated areas for children, specifically outdoors,” she said. “Young children are impressible. … Secondhand smoke, even in outdoor settings, is a true health hazard and harms everyone.”
Uhde said discarded tobacco products in play areas may be ingested by toddlers.
“I believe we set an example for the children of this community,” park board President Mike Schwartz said after the meeting.
Bismarck Parks and Recreation Executive Director Randy Bina said the smoking ban will create a better awareness of healthy lifestyles and examples for children.
“All we’re saying is, if someone does want to smoke, just step away 20 feet from the playground and just don’t smoke inside the playground,” he said.
Bina said Go! Bismarck Mandan will help the park district pay for new signs explaining the tobacco bans in playgrounds. He didn’t think there would be an enforcement issue.
“This policy is dependent upon people self-policing the playgrounds. We need the cooperation of all of the users that if they see someone smoking, make the individual aware of the policy and ask them to move 20 feet away from the playground,” he said.
Two proposals to further limit tobacco use in Mandan parks failed on Monday. Tobacco use is already barred at several park locations and events throughout the Mandan park system.
In separate action, the Bismarck Park Board:

  • Agreed to advertise for bids for the Hoge Island boat ramp. It also entered into an agreement with the state Game and Fish Department to replace the ramp.
  • Received a final facilities report from JLG Architects that gave them several options for replacing Hillside Pool and making it a year-round meeting facility, improving the World Memorial Building and adding at least one more sheet of ice for hockey programs. Bina said the options will be discussed in the 2014 budgeting process this summer. For more information about the proposals, visithttp://bisparks.org.
  • Awarded Northwest Contracting the bid for the Schaumberg Arena work to remove its sand base floor and replace it with concrete, and install new refrigeration piping, ceiling work and an overhead door on the east side. The low bid is $587,200. The project will be finished by Oct. 1, Bina said.

http://bismarcktribune.com/news/local/govt-and-politics/smoking-banned-on-bismarck-s-playgrounds/article_2e55767c-be8c-11e2-9916-001a4bcf887a.html#.UZY87qvHp4c.facebook

New tobacco limits fail in Mandan parks

Two attempts to tighten tobacco limits in Mandan’s park system failed Monday. In the end, the Mandan Park Board voted to support keeping several locations where tobacco is already banned by park staff.
The Go! Bismarck Mandan Coalition in April proposed that tobacco use be banned in all playgrounds in the district.
Based on survey results and comments, Parks and Recreation Director Cole Higlin proposed prohibiting tobacco use everywhere but in parking lots and the golf courses on Mandan park property.
“I do not like people to smoke near parks because I like to play and want everyone to be safe,” said 10-year-old Zara Laber, a park user.
Her mother, Shawna Laber, said allowing smoking where children gather is “not positive role modeling for anyone under (age) 18 … and a fire safety (issue).” She said smokeless tobacco is unsanitary near children.
Jack Jones of the Mandan Softball Association said the adults already police themselves in ball games.
“If golf is left out this, I would appreciate if the softball complex was as well,” he said. “It is against (American Softball Association) rules to smoke while playing. … Occasionally, there are players between innings and between games that will step out of the dugout, walk down a ways and have a cigarette. In 25 years, I’ve never seen anybody smoke in the bleachers.”
Vice Park Board President Tracy Porter made a motion to ban smoking in parks and shelters, soccer field at Dacotah Centennial and its dog park. The motion died for a lack of a second.
Park board member Kevin Allan made a motion that prohibited tobacco use on all park district properties, except for the golf courses and parking lots.
“Common sense prevails. If it’s not broke don’t fix it,” said Park Board President Jason Arenz. Allan’s motion failed in a 4-1 vote. Allan was the only park board member to vote yes.
Arenz briefly stepped down as president so he could make a motion endorse the parks policy, which now bans tobacco at youth baseball, Dacotah Centennial Park and its seating, Memorial Ballpark and the Raging Rivers. All five park board members approved it.
Park board member Wanda Knoll said she’d like to revisit tobacco policy in four months and see if there is an issue. Higlin said there had been no complaints about current tobacco policy.
http://bismarcktribune.com/news/local/govt-and-politics/new-tobacco-limits-fail-in-mandan-parks/article_8bad7bbe-bc3c-11e2-b616-0019bb2963f4.html

Parks ponder playground tobacco ban

Mandan and Bismarck park systems will consider making their green space smoke-free next week.
The Mandan Park Board, which surveyed its park users, will revisit the issue at 5:30 p.m. Monday.
Both park entities were approached by the Go! Bismarck-Mandan Coalition to remove tobacco from the play areas.
The group will make its pitch to the Bismarck Park Board at its 5:15 p.m. Thursday meeting at the City/County Building.
A Mandan park committee recommendation favors banning smoking everywhere but parking lots and the golf course, Mandan Parks and Recreation Director Cole Higlin said Friday. The Mandan Park Board will make the final decision on what tobacco limits to set.
Higlin said tobacco use is already prohibited at most Mandan park facilities and there are signs posted. He said the new proposal also will keep it off park trails, adult softball areas and the Dacotah Centennial Park area.
He doesn’t expect expansion will cause a bigger maintenance issue for staff.
“It probably causes no more or less littering,” he said. “Receptacles could be added (for the cigarette butts).”
Higlin said 292 park system users responded to a survey about a tobacco ban for facilities, either online or using one that had been sent to them by email.
Nearly 44 percent said second-hand smoke at outdoor park facilities bothered them a lot. Twenty percent said it bothered them a little and 29.2 percent said it didn’t bother them at all.
Those polled also were asked if they were bothered by smokeless or spit tobacco. Of the responders, 26.6 percent said it bothered them a lot, 37.2 percent said it bothered them a little and 36.2 percent they weren’t bothered.
Of the Mandan park system users polled, 61 percent favored banning it at the golf courses and 38 percent said they were opposed. Nearly 60 percent wanted it banned on trails and 40 percent were against barring tobacco on trails.
About 80 percent said they wanted tobacco use banned on athletic fields and playgrounds. Eighty-one percent wanted its use banned at concession areas and 67 percent wanted tobacco off Dacotah Centennial Park, according to the Mandan poll.
Higlin said common sense would come into play, and people would follow the rules without staff intervention to enforce it.
“We hope this serves as a possible message to the youth,” said Higlin.
“Go! Bismarck-Mandan is asking us to do this in the playgrounds only,” said Bismarck Park Board member Wayne Munson. “Personally, I favor that idea.”
He said there could be issues with enforcement.
Bismarck Parks and Recreation Executive Director Randy Bina said the proposal sounds reasonable.
He doesn’t expect the park district will incur many extra costs for its 44 playgrounds. Go! Bismarck-Mandan has offered to pay for stickers for both park entities.
“Most park users are respectful of others (in their tobacco use),” he said.
Bina said, if approved, the park district might model the playground policy after the state smoking ban for buildings and keep tobacco use 20 feet away from a playground.
http://bismarcktribune.com/news/local/govt-and-politics/parks-ponder-playground-tobacco-ban/article_541f0f6e-b9bc-11e2-9dd2-001a4bcf887a.html

House rejects tobacco prevention budget

A narrow House majority voted down the budget for the North Dakota Center For Tobacco Prevention and Control Policy on Thursday.
“We’ll get that back and get that through tomorrow (Friday),” said Majority Leader Al Carlson, R-Fargo.
The House voted against Senate Bill 2024 Thursday morning by a 46-47 vote. A motion to reconsider the bill during the chamber’s afternoon floor session also failed.
SB2024 has a total budget of $15.8 million and calls for three new full-time employees.
Carlson said House members should have given it further review.
“Tomorrow it’ll come back,” Carlson said. “I think the biggest sticking point was the three new FTEs.”
Rep. Jon Nelson, R-Rugby, admitted being caught off-guard by the vote Thursday.
“There’s just some people that have had a hard time accepting the vote of the people on Measure 3,” Nelson said.
The Center for Tobacco Prevention and Control Policy was created through Measure 3, which got 54 percent of the vote in the 2008 general election. The agency is constitutionally mandated and is required to be funded.
Measure 3 created an advisory board that shaped policy for a statewide tobacco prevention program. The program is funded through the settlement of a 1998 multistate lawsuit against the country’s largest tobacco companies.
“There’s people that, every time it comes up, no matter what it is, they’ll vote no without even listening,” Nelson said.
He put the normal number of votes against bills relating to the agency at 25-30. “Never in God’s world would I’d think there’d be a majority,” he said.
Rep. Blair Thoreson, R-Fargo, said he thought lawmakers were trying to send a message. Thoreson had voted against SB2024 on Thursday morning but voted in favor of reconsideration.
“Part of my problem is there is a lot of money being spent on things such as advertising,” he said.
Thoreson has sponsored two smoking-related bills during the session. House Bill 1253, which passed, dealt with getting proper no-smoking signs
to comply with the state’s public smoking ban.
House Concurrent Resolution 3033, which failed, called for an interim study on alternatives to prevent smoking.
Jeanne Prom, executive director of the Center For Tobacco Prevention and Control Policy, said she was perplexed by the message the House was sending.
“It was in direct conflict with the voice of the people,” Prom said.
If there’s a philosophical issue with the concept of a state tobacco prevention agency, the state shouldn’t have been involved in the original tobacco lawsuit, she said.
“Because we’ve accepted the money, we’ve accepted that responsibility,” Prom said. “It’s time to maintain the funding of this program and move on.”
http://bismarcktribune.com/news/local/govt-and-politics/house-rejects-tobacco-prevention-budget/article_fe324be4-ade9-11e2-82b8-0019bb2963f4.html

How Obama’s tobacco tax would drive down smoking rates

By Sarah Kliff, Washington Post
President Obama’s proposal to nearly double the federal tobacco tax would help fund a universal pre-K program. And, if history is any guide, it would likely have a marked impact on driving down the country’s smoking rates.
“Increasing the price of tobacco is the single most effective way to discourage kids from smoking,” CDC director Tom Frieden told reporters Tuesday afternoon. “We estimate this would result in at least 230,000 fewer kids smoking than would have smoked if the tobacco tax does not go into effect.”
Researchers have conducted over 100 studies that have “clearly and consistently demonstrated that higher cigarette and other tobacco product prices reduce tobacco use,” Frank Chaloupka, a professor at the University of Illinois in Chicago, writes. While tobacco is an addictive substance, demand tends to be surprisingly elastic: Price increases have reliably shown to decrease cigarette purchases.
The Congressional Budget Office recently looked at what would happen if the country implemented a 50-cent per pack tax on cigarettes. It estimates, given the research we have on tobacco taxes, that the price increase would lead to 1.4 million fewer smokers by 2021.
Many of those gains would be concentrated among younger Americans, who would take up smoking at lower rates:
A few years after the hypothetical tax increase took effect, the number of 12- to 17-year-olds who smoked cigarettes would be about 5 percent lower than it would be otherwise, the number of 18-year-old smokers would be 4.5 percent lower, the number of 19- to 39-year-old smokers would be almost 4 percent lower, and the number of smokers age 40 or older would be about 1.5 percent lower.
The CBO data suggests that a cigarette tax is more successful at reducing tobacco use among shorter-term smokers, vs. older Americans who may have been smokers for a longer period of time.
Even among those who don’t fully quit, tobacco taxes do appear to effect the intensity of smoking. A 2012 study in the journal Tobacco Control interviewed thousands of smokers over a time period where states increased their tobacco taxes. It found that the most intense smokers — those who smoked 40 or more cigarettes per day — saw the steepest decline in cigarette consumption.
“The dramatic reductions in daily smoking might be driven,at least in part, by heavier smokers’ desire to reduce the number of cigarettes they smoke per day,” lead study author Patricia A Cavazos-Rehg writes. “This could be because of their comorbid health problems and/or advice from influential persons (eg, doctors/friends/family) to try to quit and/or reduce smoking.”
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/04/11/how-obamas-tobacco-tax-would-drive-down-smoking-rates/