This seems quite fair though. If I make lifestyle choices that reduce my health risks, why should I not reap the rewards of lower health expenses?

As the public interest law professor who first developed the concept of differential health insurance rates for smokers, obtained two federal rulings permitting smokers to be charged more for their health insurance, has been called “the law professor who masterminded litigation against the tobacco industry” and “a Driving Force Behind the Lawsuits That Have Cost Tobacco Companies Billions of Dollars,” and helped get a 50% surcharge on smokers included in the Obamacare legislation, I have been successful in persuading a growing number of companies to adopt the concept. Here’s why:
* The best estimate is that each smoking worker adds costs of $12,000/yr or more in increased health care costs, disability costs, excess absenteeism and other productivity expenses to his employer.
* So, even if not a single smoker quit from a smoker surcharge, requiring smoking employees to bear at least some small share of these costs is fairer than placing the expense on the shoulders of the great majority of employees who wisely do not smoke in the form of higher health insurance costs, lower salaries, etc.
* It is clear that one of the most effective ways to help smokers do what most already want to do – quit – is to make it more expensive to continue, whether through higher taxes, multibillion dollar settlements payments by the tobacco industry, or higher medical costs.
* For many smokers with no symptoms, and who are reluctant to accept statistical evidence, a higher health insurance premium may provide the first real and direct incentive to quit.
* Paying workers more if they quit is unfair because most employees get nothing, and paying all employees more for not being smokers doesn’t work very well because the size of such incentives is obviously quite limited. But, under Obamacare, smokers can be charged 50% more, an amount large enough to provide a significant incentive to quit.
President Obama and most liberal as well as conservative commentators have agreed that a key to solving the health care crisis it to impose personnel responsibility on people for their behavior. That’s exactly what charging smokers more does.

JOHN F. BANZHAF III, B.S.E.E., J.D., Sc.D.
Professor of Public Interest Law
George Washington University Law School,
FAMRI Dr. William Cahan Distinguished Professor,
Fellow, World Technology Network,
Founder, Action on Smoking and Health (ASH)
2000 H Street, NW
Washington, DC 20052, USA
(202) 994-7229 // (703) 527-8418
^[7] @profbanzhaf

B.S.E.E., J.D., Sc.D? The post quotes concerns about overweight people.

Professor Banzhaf,

Thanks for writing in. I am curious: what is your view of the use of differential rates for overweight people (rather than smokers)?

John Banzhaf,

WRT rising medical costs making it easier for people to quit. Your model is basically one of time-inconsistency. Otherwise, people who want to quit would just do it. But if time inconsistency is the issue, probable medical costs in many years are unlikely to be effective at all. Why would higher medical costs matter if cancer+death doesn’t?

Blaming this on market-oriented thinkers is stupid. Market-oriented thinkers don’t want there to be employer-provided healthcare at all, because employer-provided healthcare only happens because of tax incentives and now Obamacare, neither of which are free market. In a true free market, the employer wouldn’t care about someone with high insurance costs because they’d be buying the insurance out of their salary and any increase in insurance costs falls solely on them.