Judge's adultBasic ruling should put attention on tobacco funds
A recent ruling by Commonwealth Court Judge Dan Pelligrini that Pennsylvania must resume funding adultBasic, the subsidized health insurance program for low-income adults, will no doubt be reviewed further in the courts. House Speaker Sam Smith, R-Jefferson, who was also named in the lawsuit, said he will press for a review, either through Commonwealth Court or the state Supreme Court.
Regardless of the final outcome in the courts, the judge’s ruling focused attention on a failing by Pennsylvania, as well as most other states: spending money from the 1998 Tobacco Master Settlement Agreement on things other than smoking-cessation or other health-related measures.
Pellegrini ruled that two state laws, one passed in 2010 and the other in 2011, violated the law by diverting money from tobacco settlement funds to other purposes. Pellegrini ruled that adultBasic, which once covered 42,000 low-income Pennsylvanians who were not eligible for Medicaid, be reinstated in fiscal year 2013-14. That ruling will be further reviewed in the courts, but the issue of how tobacco settlement money is spent deserves attention.
The 1998 settlement between big tobacco companies and the states awarded the states $246 billion over 25 years. The lawsuit was filed by states because they alleged that they were spending lots of money treating tobacco- related health problems. When they won the multibillion-dollar settlement, all of the money should have been targeted for health care, particularly related to tobacco.
Not surprisingly, states have been using very little of the tobacco settlement money for health care and even less for tobacco-related programs.
According to tobaccofreekids.org, states are expected to collect about $25 billion in revenue in 2013 from the tobacco settlement, but will spend only 1.8 percent of that total on smoking- cessation efforts.
Few states are keeping the promise to use tobacco settlement funds for tobacco prevention programs or even treatment of tobacco-related illnesses, according to ABC News.
If smoking cessation or anti-smoking marketing efforts are not effective, then the money should be spent treating people with smoking-related illnesses such as cancer and heart disease.
Some of the more outrageous diversions of tobacco settlement funds include New York’s Niagara County spending $700,000 in tobacco settlement funds on a sprinkler system at a golf course. In Alaska, $3.5 million of tobacco settlement funds were spent in Wrangell, Alaska, to fix shipping docks.
Most states used much of the tobacco settlement money simply as a windfall and dumped it into their general funds.
Pelligrini noted that 30 percent of Pennsylvania’s tobacco settlement money must go to Medicaid for disabled workers and adultBaasic.
Created in 2001, the adultBasic program was funded in part by tobacco settlement money and voluntary contributions from the states’ four Blue Cross-Blue Shield insurance companies. The program cost $166 million in 2010, and Gov. Tom Corbett announced in 2011 that the program had run out of money and would end. The loss of contributions from the Blues was reportedly one reason for the program’s money problems.
Another problem might have been the very high level of subsidies provided — adultBasic cost a couple just $36 a month for coverage.
If, after further legal review, adultBasic is reborn, the program deserves review — and probably reform.
But the judge’s ruling should serve as a reminder that politicians in Pennsylvania should spend tobacco settlement money on health care only — if not on smoking-cessation programs, then on health care related to smoking or tobacco usage.
