How much do nonsmokers shell out for the health care of smokers? In recent testimony before Congress, economist Jeffrey Harris of Massachusetts Institute of Technology, who is also a physician, provides some estimates.
Cigarettes, says Harris, are responsible for 20% of deaths in the U.S. and roughly 8% of all health-care spending. Assuming universal coverage by 1995, he expects medical expenditures that year to reach $1.1 trillion and smoking-related outlays to hit $88 billion. Of that, he says, only $33 billion will be borne by current and former smokers via insurance, taxes, and direct payments. Nonsmokers will pay the other $55 billion.
Harris figures that for every pack of cigarettes sold in 1995, nonsmokers will pony up $2.32 to help cover the nation's smoking-related medical bill. In short, he says, "although it could cut consumption by as much as 12% over time, the Administration's proposed 75 -a-pack hike in federal excise taxes, plus the current 24 federal tax, wouldn't come close to offsetting the costs imposed by smokers on the 63% of Americans who never acquired the habit."