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Lots of smoke but little fire to reduce Indiana’s smoking habit

State officials are appealing a $63 million reduction in Indiana’s share of tobacco master settlement payments. But even without the penalty, Indiana’s tobacco prevention and cessation efforts are sputtering. In a state where tobacco-related health care costs exceed $2 billion a year, the failure to aggressively discourage smoking is an expensive proposition.

Nearly three years ago, the state’s Tobacco Prevention and Cessation program was folded into the Indiana State Department of Health. As critics of the move suggested at the time, the fight seemed to lose its steam.

“Indiana has the unfortunate distinction of failing to make progress in the fight against tobacco use in 2013, and protecting its citizens from tobacco-caused diseases like lung cancer, the leading cancer killer of both men and women in Indiana,” wrote Lindsey Grace, manager of advocacy for the American Lung Association in Indiana, upon the release of the organization’s State of Tobacco Control 2014 report in January. “Meanwhile, Big Tobacco continued to rob our health and wealth with clever new tactics to lure new youth smokers.”

The association’s report gives the state dismal marks: F for tobacco prevention and control funding; F for cessation coverage; D for cigarette taxes and C for smoke-free air laws.

Tobacco-related illnesses kill more than 9,800 people in Indiana each year and cost the state’s economy $4.8 billion in health care costs and lost productivity, according to the Lung Association. Nearly a quarter of Hoosiers are smokers.

The 1998 master agreement between the five largest tobacco companies and 46 states, including Indiana, required the companies to indefinitely make annual payments of about $10 billion to the states to compensate for a share of medical costs for smoking-related illnesses. In the early years, Indiana and other states diligently dedicated settlement payments to prevention and cessation efforts.

Over time, however, the commitment has faltered, although the state did reserve the money for other health programs. A recent report by the Campaign for Tobacco-Free Kids found that Indiana spends less than 8 percent of the amount recommended by the Centers for Disease Control for anti-tobacco programs. By contrast, North Dakota spends more than 97 percent of the amount recommended by the CDC.

Indiana’s paltry $5.8 million allocation this year – compared to nearly $537 million in tobacco-generated revenue – isn’t likely to benefit from a decision last September to reduce the state’s annual tobacco settlement payment from $131 million to $68 million. A three-judge arbitration panel ruled that in 2003 Indiana and five other states failed to “diligently enforce” provisions of the master settlement involving tobacco companies that were not parties to the original agreement. Because payments for subsequent years are in dispute as well, more losses could be ahead.

Indiana could have avoided the huge reduction by joining 22 other states in a settlement. Instead, it took its dispute to arbitration, hiring former Attorney General Steve Carter to represent the state. The Indiana Law Blog reported this week that Carter’s original $35,000 contract has been renewed or amended nine times since 2010, for total payments of $886,000.

Bryan Corbin, spokesman for the Indiana Attorney General’s office, told the Law Blog’s Marcia Oddi that the appeal of last fall’s ruling is pending before the Marion County Superior Court and a hearing is scheduled for mid-July.

Here’s hoping Indiana prevails in its legal battle, but also that state officials will resume spending more of its tobacco settlement money in prevention and cessation efforts. The cause certainly deserves as aggressive a fight as the state is waging in the courts.