State anti-smoking program has saved Californians over a trillion dollars in healthcare costs alone

Tobacco companies oppose tobacco control policies by arguing that anything that reduces tobacco use hurts the economy. The new paper Jim Lightwood, Steve Anderson and I just published “Smoking and healthcare expenditure reductions associated with the California Tobacco Control Program, 1989 to 2019: A predictive validation,” shows that, quite the contrary, reducing smoking saves a fortune in healthcare costs and those savings start to appear quickly and grow over time.

Unlike most analyses of the healthcare savings associated with reductions in smoking, our analysis examines both short-term (year to year) and long-term benefits of reducing smoking. The analysis, which relates changes in funding for the state’s anti-smoking campaign to changes in smoking (both adult prevalence and per-smoker packs consumed) and changes in smoking to changes in healthcarecare costs, uses econometric forecasting techniques widely used by major businesses for their planning.

Over three decades since California voters created the Program when they passed Proposition 99 in 1988, California’s adult smoking prevalence fell from 21.8% in 1989 to 10% in 2019. The anti-tobacco program accounted for 2.7 of those percentage points. Those who didn’t quit cut back by an average of 119 packs per year in response to the program.

Total healthcare savings came to $816 billion in 2019 dollars.

During that same time, the Program cost a total of $3.5 billion, yielding a return on investment of 231 to 1.

These benefits accrued because Californians smoked 15.7 billion fewer packs of cigarettes than would have been expected absent the Tobacco Control Program. The only loser was Big Tobacco, which lost $51.4 billion in sales.

In addition to coming up with these numbers, we showed that the econometric model remained stable over time and was able to predict future smoking and healthcare costs. These findings increase the confidence that the results can continue to be used in the future.

Bringing things up to the present: $816 billion in 2019 dollars is $960 billion in 2023 dollars, nearly a trillion dollars. And, of course, the savings have continued to pile up since 2019, meaning as of today the total savings on healthcare costs alone is almost certainly now more than a trillion dollars.

This is just savings on direct healthcare costs. The tobacco control program also lowers many other costs, including lost wages, costs of smoking-caused fires and environmental cleanup costs of cigarette butts and e-cigarette e-waste.

And, of course, thanks to the effort, Californians are living longer healthier lives. We didn’t quantify that important benefit.

Here is the UCSF press release:

California’s Anti-Smoking Push Spurs Big Savings on Health Costs: For every dollar spent, the state has seen a $231 return

In the late 1980s, when smoking was still allowed on some airline flights, California boosted its tax on cigarettes from 10 to 35 cents a pack, devoting 5 cents to programs to prevent smoking.

The newly created California Tobacco Control Program funded anti-tobacco media campaigns and community programs to try to improve public health, but some questioned whether the efforts were worth the cost.

Now comes an answer: For every dollar California spent on smoking control, health care costs fell by $231.

Over three decades that witnessed historic lawsuits and expanding smoking bans, California’s smoking population fell from 21.8% in 1989 to 10% in 2019. Its anti-tobacco program accounted for 2.7 of those percentage points, which may seem small but yielded large savings. Those who didn’t quit ended up cutting back by an average of 119 packs per year in response to the program, according to the study, which appears March 16 in PLoS One.

Senior author Stanton Glantz, PhD, the recently retired founding director of the UCSF Center for Tobacco Control Research and Education, summed up the findings this way: “Tobacco control programs save a fortune.”

Over the 30-year history of the program, Californians pocketed $51.4 billion they would otherwise have spent on cigarettes. Total health care savings came to $816 billion.

“The return on investment is gigantic,” Glantz said. “These programs aren’t just saving lives and making people feel better, they’re also saving people money.”

Shaping Anti-Tobacco Policy

Doing the econometric work to track the relationship between three types of spending – state tobacco control, consumer tobacco purchasing and health care expenses – over three decades were lead author James Lightwood, PhD, a UCSF associate professor of clinical pharmacy, and Steve Anderson, a financial industry forecasting expert. They used a predictive model first developed by Lightwood and Glantz in 2013, plugging in updated data for their calculations.

The model has held up over 30 years, almost ten years beyond the original sample, through changing economic conditions and levels of California tobacco control spending, according to Lightwood.

“This paper significantly strengthens the case that there is a causal relation between tobacco control and smoking reduction,” Lightwood said.

The authors said the modeling results can help shape tobacco policy in states considering tobacco control measures and in those where support for existing programs may be wavering. The forecasting methods used in the paper are very much like those that large businesses use to inform major business decisions, Anderson said.

“Any state with a high level of smoking that launches a substantial, long-term program should get results similar to California’s,” Lightwood said. “But public policy has unique challenges. The political expediency of short-term thinking dogs many tobacco-control efforts.”

California is large and diverse, spanning rural and urban areas, and its population includes many races and ethnicities across the socioeconomic spectrum.

“California is so big that it can be considered average in many ways relevant to the evaluation of a tobacco control program,” Lightwood said.

Benefits Grow Over Time

In previous research, Lightwood and Glantz have shown short-term cost benefits of tobacco reduction – heart attacks, strokes and low birthweight decline quickly. The current paper models both the short and long-term effects of state programs, which also reflect declines in slower-to-emerge diseases, such as lung cancer.

“The benefits grow over time as more and more diseases are prevented,” Lightwood said. “If you do a less comprehensive program for four or five years, then it’s hard to detect much change in the face of year-to-year variability and the program is vulnerable to attack. But, when the program is large, long-term and comprehensive, like California’s, we can confidently conclude that there are large and immediate benefits that grow with time.”

The new findings confirm that tobacco control efforts spur smoking reductions and that even a seemingly small reduction in smoking, like the 2.7% attributed to the state’s tobacco control program, quickly and significantly drives down health care expenses.

“Tobacco control,” Glantz said, “is one of the strongest things you can do for medical care cost containment.”

Here are a few specific numbers:

Numbers for 2019
	Actual	Without Program	Difference due to program
Adult smoking prevalence	10.0%	12.7%	2.7%
Packs consumed per adult smoker/year	202	321	119
Savings on cigarettes per adult smoker/year			$969 for continuing smokers (119 x $8.141/pack) $2613 for smokers who quit (321 x $8.141)
Medical costs for California (from US CMS) for just 2019	$385 billion	$428 billion	$42.8 billion

Here is the abstract:

Background. Previous research used data through 2008 to estimate a model for the effect of the California Tobacco Control Program (CTCP) that used cumulative real per capita tobacco control expenditure to predict smoking behavior (current adult smoking prevalence and mean cigarette consumption per current smoker). Predicted changes in smoking behavior due to the CTCP were used to predict its effect on health care expenditure. This research updates the model using the most recently available data and estimates CTCP program effect through 2019.

Methods. The data used in the previous research were updated, and the original model specification and a related predictive forecast model were re-estimated. The updated regression estimates were compared to those previously published and used to update estimates of CTCP program effect in 2019 dollars.

Results. There was no evidence of structural change in the previously estimated model. The estimated effect of the CTCP program expenditures on adult current smoking prevalence and mean consumption per adult current smoker has remained stable over time. Over the life of the program, one additional dollar per capita of program expenditure was associated with a reduction of current adult smoking prevalence by about 0.05 percentage point and mean annual consumption per adult current smoker by about 2 packs. Using updated estimates, the program prevented 9.45 (SE 1.04)  million person-years of smoking and cumulative consumption of 15.7 (SE 3.04)  billion packs of cigarettes from 1989 to 2019. The program produced cumulative savings in real healthcare expenditure of $544 (SE $82) billion using the National Income and Product Accounts (NIPA), and $816 (SE $121) billion using the Center for Medicare and Medicaid Services (CMS) measure of medical costs. During this time, the CTCP expenditure was $3.5 billion.

Conclusion. A simple predictive model of the effectiveness of the CTCP program remained stable and retains its predictive performance out-of-sample. The updated estimates of program effect suggest that CTCP program has retained its effectiveness over its 31-year life and produced a return on investment of 231 to 1 in direct CMS medical expenditure.

The full citation is: Lightwood JM, Anderson S, Glantz SA (2023) Smoking and healthcare expenditure reductions associated with the California Tobacco Control Program, 1989 to 2019: A predictive validation. PLoS ONE 18(3): e0263579. https://doi.org/10.1371/journal.pone.0263579. It is available for free here.