The economic burden of smoking in California

To develop estimates of the direct and indirect costs of smoking for California in 1999.

A prevalence based approach was used to estimate the annual costs of smoking. Econometric models were used to estimate the smoking attributable fraction (SAF) for direct costs (hospitalisations, ambulatory care, prescription drugs, home health care, and nursing home services) and indirect costs due to lost productivity from smoking related illness. The models controlled for socioeconomic factors and other risk behaviours. Epidemiological methods were used to estimate the SAF for indirect costs due to lost productivity from premature deaths. The SAFs were applied to total health care expenditures, days lost, and deaths to obtain smoking attributable total costs.

In 1999, the total costs of smoking in California were 15.9 billion dollars, 475 dollars per resident, and 3331 dollars per smoker. Direct costs were 8.6 billion dollars (54% of the total), indirect costs due to lost productivity from illness were 1.5 billion dollars (10%), and indirect costs due to premature deaths were 5.7 billion dollars (36%). The cost of smoking was 9.4 billion dollars for men and 6.3 billion dollars for women. There were 43,137 deaths attributed to smoking, representing a total of 535,000 years of life lost. The value of life lost per death averaged 132,000 dollars, or 12.4 years.

California smoking related costs are high. The cost methodology presented is useful for other states and nations interested in estimating their costs of smoking. Cost estimates can be used to evaluate the level of cigarette taxes and other policies related to smoking.