02 November 2012

Total Lifetime Savings of Smoking Cessation

Quit Smoking
The Senate Committee Report on the Sin-Tax Bill has been labelled by its supporters as a more realistic version, especially when it comes to the assumed revenue projection (PhP 14.8 Billion). They expressed doubts on the much-hyped target of the executive agencies which pegged the collection to as much as PhP 60.0 Billion in revenues if the bill is passed in its original and unaltered form.

The only problem with the assumption of Senator Ralph Recto’s new version is that it valued everything in monetary terms when in fact, the bill was intended primarily to address health concerns before anything else, including the revenue collection. When you factor in non-monetary benefits and savings, the assumptions become more than just using financial analysis indicators. It has to consider economic benefits of not smoking.

Smoking cessation has major immediate and long-term health benefits. However, ex-smokers' total lifetime health costs and continuing smokers' costs remain un-compared, and hence the economic savings of smoking cessation to society have not been determined in the past.

Few studies have estimated the economic impact of smoking cessation in a lifetime perspective, and findings are still unclear. For instance, Oster, Colditz and Kelly found the economic benefits of quitting, estimated from direct and productivity lifetime costs based on three smoking-related diseases, to be sizeable for all groups of smokers; however, they did not take life expectancy into account (The economic costs of smoking and benefits of quitting for individual smokers, 1994).

In 1997, Barendregt, Bonneux and vanderMaas (The health care costs of smoking) included life expectancy and reported 15 percent higher direct lifetime health care costs in non-smokers (never smokers and ex-smokers) than in smokers, and characterize anti-smoking interventions as unattractive in a narrow economic sense.

One study in 2004 enhanced the perspective on economic cost of smoking when Susanne R. Rasmussen, Eva Prescott, Thorkild I. A. Sørensen and Jes Søgaard published their findings for the Danish Medical Research Council and DSI Danish Institute for Health Services Research.

Entitled, "The Total Lifetime Health Cost Savings of Smoking Cessation to Society," Rasmussen et al has addressed the cost problem by examining the economic effects of smoking cessation in a lifetime perspective and compared this with the health costs of continuing smokers and ex-smokers by quantity of daily tobacco consumption, age, gender and disease group, while taking differences in life expectancy and the reductions in relative risks after cessation into account.

The study showed that the total lifetime health cost savings of smoking cessation are highest at the younger ages. Although the economic savings vary with age at quitting, gender and quantity of daily tobacco consumption, all ex-smoking men and women who quit smoking at the age of 35 to 55 years generate sizeable total lifetime cost savings. At older ages, the total lifetime health cost savings of smoking cessation are of little economic consequence to the society.

The TOTAL, DIRECT and PRODUCTIVITY lifetime cost savings of smoking cessation in moderate smokers who quit smoking at the age of 35 years are PhP 1,729,056; PhP 529,872; and PhP 1,199,184 in men, and PhP 2,377,452; PhP 850,584; and PhP 1,519,896 in women, respectively. Comparing 35-year-old ex-smoking men who quit smoking at the age of 35 years with 35-year-old continuing smokers, the direct lifetime health cost savings of smoking cessation to society are 30–42 percent

The conclusion is that lifetime health cost savings of smoking cessation to society are substantial at younger ages, in terms of both direct and productivity costs. Hence, if the Sin-Tax Bill will help discourage smoking among the younger generation, the projected benefit of PhP 60.0 Billion can easily be met.