Hospitals talk about helping the uninsured, but they just want more cash

Selling cigarettes is still a profitable enterprise, despite decades of government action. What to do next in the never-ending war against the demon weed? One health-care interest group has a whopper of an idea.

California hospitals say that they can turn a sow's ear into a silk purse by seizing tobacco revenue, which they promise to use for treating uninsured patients. All we have to do is approve Proposition 86, which will increase the price of a pack of cigarettes by two-thirds, and leave the rest to them.

By simply voting "yes" on Nov. 7, voters will guarantee that our state's hospitals increase their gross revenue by more than 1 percent – with no accountability.

Recall that this is not the first time the hospitals have bellied up to the tobacco trough. Prop. 99, passed in 1988, levies a 25-cent excise tax on cigarettes, some of which is siphoned off to hospitals. Voters might want to verify whether this funding has accomplished its purpose over the past 17 years. Are hospitals and emergency rooms treating the uninsured any better than they were in 1988?

Well, Sutter Health just settled a class-action suit by uninsured patients, related to the stratospheric charges it bills them, and many other California health systems are facing similar challenges. Things are not as bad for the uninsured as the lawsuits suggest. What hospitals charge uninsured patients and what they collect from them are very different: about $1 collected for every $6 in costs.

This absurdity is due to federal mandates that have distorted hospital prices. The hospitals do hold a legitimate grievance about how the government makes them operate, but hospitals are not interested in reforming those rules – they just want more cash.

If the hospitals really wanted to help uninsured patients by taking a bite out of Big Tobacco, rather than just fund their own bottom line, they would have written a proposition that used excise taxes to fund tax credits that uninsured Californians could use to spend on health care according to their own preferences. Instead, Prop. 86 creates a cash flow of about three-quarters of a billion dollars a year that hospitals will divide up as they – and only they – see fit.

Prop. 86 will also have other harmful consequences.

The best-case scenario anticipates about half a million of California's 3.8 million smokers quitting because of the higher prices. However, the 3.3 million who keep smoking will lose more than $1,000 annually from their disposable income to taxes. That's money that they could use to support their own healthy choices if they choose to quit independent of government control.

Californians should not allow our hospitals to become distracted from patient care through an easy addiction to cigarette money.