Tobacco Tax Could Fund ‘Healthy Kids’ Plan

With Oregonians facing rising health care costs, OSPIRG advocated practical solutions in the 2007 legislative session. Among OSPIRG’s key priorities was joining with nurses, parents and health advocates to speak up for making children’s health care coverage affordable through an increase in the tobacco tax. The legislature plans to refer the plan to voters for approval on the November 2007 ballot.

“Gov. Kulongoski and leaders in the Legislature are doing the right thing by advancing this smart plan for Oregon’s children,” said Laura Etherton, OSPIRG consumer advocate.

The plan seeks to address the nearly 118,000 Oregon children who go without health insurance. More than 90 percent of uninsured children live in families where at least one parent works, but skyrocketing health care costs are putting coverage out of reach.

“Children without health insurance are more likely to end up in the emergency room. Not only is it terrible for them—it actually ends up driving costs up for everyone,” said Etherton.

Experts estimate health insurance premiums are about 10 percent higher due to costly emergency room care for the uninsured.

The Healthy Kids Plan would give every child access to quality affordable health care by securing new federal funds for the Oregon Health Plan. The plan would also pool purchasing power in order to negotiate for lower rates. The plan creates an affordable, accountable private children’s insurance plan that would be available on a sliding scale to Oregon families.

“It makes sense to give children guaranteed access to check-ups, preventative care and effective treatment,” said Etherton. “It also makes sense to stop young people from smoking by increasing the tobacco tax and funding proven tobacco prevention programs.”

Experts estimate that the proposed increase in the tobacco tax will prevent more than 29,400 of today’s children from taking up smoking, and save over 9,400 children from dying prematurely due to smoking-related illnesses. With these and other projected smoking reductions, Oregon could see $658 million in long-term health care savings.

Short-term savings are significant as well. Proven tobacco prevention programs funded at the levels recommended by the Centers for Disease Control and Prevention would save an estimated $41 million in health care spending over the next five years by reducing the number of cases of smoking-related illnesses.

Debate on the proposed healthy kids program in the 2007 Legislative Session occurred within the context of debate over broad health care reform concepts. Sen. Alan Bates (Ashland/Medford) and Sen. Ben Westlund (Tumalo) co-chaired a Special Senate Committee on Health Care Reform, which was joined by Rep. Mitch Greenlick’s (Portland) House Health Committee.

The committees discussed a set of broad reform proposals developed in the interim by Former Governor John Kitzhaber and the Archimedes Movement, by the Oregon Health Commission, and by the Senate Interim Commission on Health Care Access and Affordability.

Health reform leaders agreed that while more overarching improvements to the health care system are required to rein in costs and improve quality and access, the Healthy Kids Plan represents a critical first step.

“Oregon can be a leader in creating the healthiest and strongest generation ever,” said Etherton, “The Healthy Kids Plan is the right place to start."