Tobacco Tax Proposed to Fund Medicaid

More people are turning towards Utah's Medicaid program at a time when there's fewer dollars to go around. Since the recession began, the program has seen a 20 percent enrollment increase. The program went from 160,000 participants to 200,000 participants. "What Medicaid does in times like this is it catches those people who can't get health care coverage on their own anymore," said Lincoln Nehring, Utah's Medicaid Policy Director.

A new report by the Utah Health Policy Project made several recommendations as to how the state can not only save money but raise revenue for Medicaid. The report suggests the state work harder at preventing Medicaid fraud, revise the program's preferred drug list, and increase tobacco taxes from 70 cents per cigarette pack to two dollars per pack.

"If you look long term for the state of Medicaid, a tobacco tax increase will probably serve the program and the health of Utahns well." says Nehring.

Last year, a similar tax increase failed, but Medicaid advocates believe the state's current budget deficit will force lawmakers to act.

Top senate leadership responded to the tobacco tax idea. Senator Wayne Neiderhouser says he doesn't think it will solve Medicaid's problem in the long term. He would only support a tobacco tax increase if the money went towards Utah's tobacco trust fund.

Senator Michael Waddoups says the plan would likely have enough votes to pass the senate, but only if the governor approves.