April 5, 2015

Stanton A. Glantz, PhD

New industry claim that e-cigarettes will save Medicaid billions depends on people not carefully reading the "policy analysis"

A March 31, 2015 “policy analysis,” E-cigarettes Poised to Save Medicaid Billions, prepared by J. Scott Moody, the Chief Executive Officer and Chief economist at the organization State Budget Solutions, has started popping up state legislatures all over the country. 
The basic argument in this “policy analysis” is that

  1. Smoking costs Medicaid much more than states collect in cigarette taxes and Master Settlement payments
  2. Smoking costs states a lot of money by increasing the cost of running subsidized and public housing.
  3. E-cigarettes will get everyone to stop smoking so all that money will be saved.
  4. Because of the benefits of e-cigarettes, they should not be taxed.

The first two points are simply a restatement of two well-done studies by the CDC (Medicaid study, housing study).   Indeed, public health advocates can use these tables to argue for increased tobacco (including e-cigarette) taxes and improved funding for aggressive state tobacco control programs.
The “evidence” supporting the assertion melts away on careful reading on the report.  For example, Moody quotes my colleague Neal Benowitz as saying, “Allowing EC (electronic cigarettes) to compete with cigarettes in the marketplace might decrease smoking related morbidity and mortality.” And “The use of e-cigarettes as a harm reduction strategy among cigarette smokers who are unable to quit, warrants further study.” [emphasis added]   Note that Benowitz does not say e-cigarettes will decrease smoking.
Moody ignored the paper that Neal Benowitz, Rachel Grana and I published in Circulation, that concluded, “Combining these results [of the five population-based studies of the effect of e-cigarettes among all smokers] in a random-effects meta-analysis (Table 2) yields a pooled OR of 0.61 (95% CI, 0.50–0.75), indicating that e-cigarette use in the real world is associated with significantly lower odds of quitting smoking cigarettes.”
The conclusion that e-cigarette use depresses smoking cessation by 30-40% as they are actually used has held up as more studies have been published;  analysis of the 11 studies available as of March 15, 2015 showed an odds ratio for quitting of 0.72, a 30% drop in quitting among smokers who use e-cigarettes compared to those who do not.
Moody also ignored the conclusions from Circulation paper;

The ultimate effect of e-cigarettes on public health will depend on what happens in the policy environment. These policies should be implemented to protect public health:
Prohibit the use of e-cigarettes anywhere that use of conventional cigarettes is prohibited.
• Prohibit the sale of e-cigarettes to anyone who cannot legally buy cigarettes or in any venues where sale of conventional cigarettes is prohibited.
• Subject e-cigarette marketing to the same level of restrictions that apply to conventional cigarettes (including no television or radio advertising).
• Prohibit cobranding e-cigarettes with cigarettes or marketing in a way that promotes dual use.
• Prohibit the use of characterizing flavors in e-cigarettes, particularly candy and alcohol flavors.
Prohibit claims that e-cigarettes are effective smoking cessation aids until e-cigarette manufacturers and companies provide sufficient evidence that e-cigarettes can be used effectively for smoking cessation.
Prohibit any health claims for e-cigarette products until and unless approved by regulatory agencies to scientific and regulatory standards.
• Establish standards for regulating product ingredients and functioning.
In addition to being important in their own right, should these policies be put in place together with polices designed to make combustible tobacco products (eg, cigarettes, cigars, cigarillos) less desirable and available, it is possible that current conventional cigarette smokers who will not quit nicotine would shift to e-cigarettes without major dual use or youth initiation to nicotine addiction with e-cigarettes. Absent this change in the policy environment, it is reasonable to assume that the behavior patterns that have been observed for e-cigarettes will persist, which makes it unlikely that they will contribute to reducing the harm of tobacco use and could increase harm by perpetuating the life of conventional cigarettes.
Although most of the discussion of e-cigarettes among health authorities has concentrated on the product itself, its potential toxicity, and use of e-cigarettes to help people quit smoking, the e-cigarette companies have been rapidly expanding using aggressive marketing messages similar to those used to promote cigarettes in the 1950s and 1960s. E-cigarette advertising is on television and radio in many countries that have long banned similar advertising for cigarettes and other tobacco products and may be indirectly promoting smoking conventional cigarettes.
Although it is reasonable to assume that, if existing smokers switched completely from conventional cigarettes (with no other changes in use patterns) to e-cigarettes, there would be a lower disease burden caused by nicotine addiction, the evidence available at this time, although limited, points to high levels of dual use of e-cigarettes with conventional cigarettes, no proven cessation benefits, and rapidly increasing youth initiation with e-cigarettes. Although some cite a desire to quit smoking by using the e-cigarette, other common reasons for using the products are to circumvent smoke-free laws and to cut down on conventional cigarettes, which may reinforce dual use patterns and delay or deter quitting.
The trajectory of the dual use pattern among adults or children is unclear, but studies of youth find that as many as one third of youth who use e-cigarettes have never smoked a conventional cigarette. Nicotine is a highly addictive substance with negative effects on animal and human brain development, which is still ongoing in adolescence. Furthermore, high rates of dual use may result in greater total public health burden and possibly increased individual risk if a smoker maintains an even low-level tobacco cigarette addiction for many years instead of quitting.
Although data are limited, it is clear that e-cigarette emissions are not merely “harmless water vapor,” as is frequently claimed, and can be a source of indoor air pollution. Smoke-free policies protect nonsmokers from exposure to toxins and encourage smoking cessation. One hundred percent smoke-free policies have larger effects on consumption and smoking prevalence, as well as hospital admissions for myocardial infarction, stroke, and other cardiovascular and pulmonary emergencies, than weaker policies. Introducing e-cigarettes into clean air environments may result in population harm if use of the product reinforces the act of smoking as socially acceptable or if use undermines the benefits of smoke-free policies.  [emphasis added]

So, like other industry-inspired “policy analyses,” there is a lot less to this one than meets the eye:

  • Moody selectively quotes the literature, ignoring research findings that do not support his position that e-cigarettes will save states money
  • Even given that, Moody never comes out and says how much e-cigarettes will reduce smoking and associated Medicaid and other state costs, although he implies it will be a lot.

Consider the source
The tobacco industry has long funded research and policy efforts through third-party front groups (more) as a way to gain academic or political credibility and to raise doubt about legitimate research.
State Budget Solutions, CEO Moody, claims to be a "non-partisan" think tank dedicated to long-term budget solutions. However the organization is a member of the State Policy Network (SPN) which receives contributions from Phillip Morris (more), and functions as an umbrella organization  for conservative think tanks around the nation. Additionally SPN provides support and is affiliated with the American Legislative Council (ALEC). ALEC has a history of receiving substantial funding from the tobacco industry, in return for which it has promoted legislation interfering with local control, nonsmokers' rights, and health policy.
Moody has a long history of ties to SPN organizations through previous employment including the Maine Heritage Policy Center, The Tax Foundation, The Heritage Foundation, The Oklahoma Council of Public Affairs, Budget and Tax Policy at the Illinois Policy Institute.  State Budget Solutions President, Bob Williams, is the Founder and Senior Fellow of the Freedom Foundation another member of SPN.
The good news
As I noted above, the summary of the research on what smoking costs states is a fair representation of good research.  It can be used to justify increasing cigarette taxes and funding of high quality tobacco control programs. 
Indeed, based on the consistent evidence that e-cigarettes as actually used are keeping people from quitting smoking, using Moody’s own logic, unrestricted e-cigarette use is substantially increasing state Medicaid and other costs.

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