Recommendation: Support state tobacco prevention and cessation efforts and other health programs. The Commission recommends that states do more to fund comprehensive tobacco prevention and cessation programs such as those suggested in the August 2000 Report of the Surgeon General to reduce tobacco use and the harms caused by tobacco. Therefore, the Commission recommends that once TERP has been fully funded, revenues from the increased federal excise tax recommended by the Commission be used for a period of five years to provide states an incentive to adopt state programs to reduce the consumption of tobacco products as well as other state public health programs.

States that have allocated state funds for tobacco prevention and cessation programs at levels that meet or exceed the minimum standards (adjusted for inflation) set by CDC would be eligible for funding to enhance their tobacco prevention and cessation efforts or, if they choose, to fund other state public health initiatives. States that have previously failed to fund tobacco prevention and cessation efforts at the level recommended by CDC would become eligible for grants that could be used for other public health purposes only when they have raised the level of state funding for tobacco prevention and cessation programs to at least the minimum level recommended by CDC.

Funding would be administered by CDC through cooperative agreements between CDC and appropriate state health agencies.

Recommendation: Regulate tobacco products. The Commission has concluded that manufactured tobacco products should be regulated. We recommend that FDA be given effective authority to establish fair and equitable regulatory mechanisms over the manufacture, sale, marketing, distribution and labeling of tobacco products with the USDA and EPA retaining authority to set safety standards governing tobacco farms and tobacco production. This authority should be comparable to FDA’s authority over other products. It is not the intention of this Commission or public health advocates in granting the FDA such authority to legally prohibit the use of tobacco products by adults.

This action would fill the gap created by the Supreme Court’s decision that the FDA does not have authority over manufactured tobacco products. The Supreme Court explicitly said that it is up to Congress to provide FDA with this authority. This proposal would establish the authority of the FDA to regulate tobacco products.

The Commission recognizes that there is much that can be done that is not now being done to prevent marketing to and the use of tobacco by young people, encourage and assist adults who wish to quit to do so, require full disclosure of ingredients, harmful constituents and other facts the FDA considers likely to protect the public health, prevent misleading labeling and claims, provide independent evaluation of the relative harmfulness of different products and their ingredients and constituents, and reduce the harmfulness of tobacco products sold to consumers.

In the long run effective regulation by the FDA benefits everyone, including farmers. It will save lives. Independent science based decisions by FDA designed to protect the public health by taking all reasonable steps to reduce the harm of tobacco products now being sold and promote the introduction of less harmful products will also create fair standards and will provide predictability to farmers and to the industry. Farmers may benefit directly. This Commission believes that America’s tobacco farmers are better able and better equipped to respond to actions designed to address the health concerns posed by current tobacco products. This proposal will provide an opportunity for America’s farmers as well as responsible manufacturers to distinguish themselves from their foreign competitors in producing crops in an environment in which health concerns are important. Because FDA’s rules provide farmers an opportunity to be heard before any rule is finally adopted, it will also prevent farmers from having to change what they are doing on short notice at the arbitrary whim of individual manufacturers who demand new production techniques or leaf characteristics based on corporate decisions with no public or farmer input.

FDA authority would be designed to protect the public health and reduce tobacco caused harms, but not prohibit tobacco use. To ensure that the FDA remains focused on the protection of public health and the reduction of harm rather than prohibition, the Commission recommends that the standard that the FDA use to guide its decision making be the "protection of public health" rather than the standard it applies to other products, that is, whether there is a "reasonable assurance that a product is safe and effective." Tobacco products as they exist today are not "safe." Given the number of Americans who use tobacco products today, prohibition would not protect the public health because it would drive many smokers to use unregulated black market products. Therefore, a statutory standard designed to promote the "public health" rather than one that requires that a tobacco product be "safe" best protects everyone’s interests. It also recognizes that the status quo for current products is not in anyone’s interest if it is possible to reduce the harm that tobacco products cause.

There has been substantial debate about whether tobacco products should be treated as "drugs." This is not a debate about whether nicotine in tobacco products is addictive because there is agreement that it is. Many farmers are concerned about a legislative action that labels tobacco products as "drugs." Public health organizations are concerned that the FDA be given the type of authority needed to effectively address the health issues raised by nicotine and tobacco products. Therefore, notwithstanding the Commission’s recognition that nicotine in tobacco products acts as a drug, to obtain the support of both the representatives of the farm community and the public health community, the Commission’s emphasis has been on what constitutes effective regulation, which can include its treatment under a separate chapter which does not regulate it as a "drug" for statutory purposes.

The Commission also recommends that USDA and EPA retain authority to set safety standards governing tobacco farms. Thus, the Commission’s proposal would not extend FDA authority to farming operations. Under this proposal FDA will not have authority over tobacco farms but farmers will be able to have input into important decisions through FDA’s normal rulemaking process.

Consistent with these goals and principles and the Core Principles adopted by farmers and health groups in 1998, the Commission recommends that FDA be provided with authority consistent with the following guidelines:

Access and marketing. FDA should have authority regarding the sale and distribution of tobacco products, including access by young people. It should also have authority concerning tobacco advertising and promotion with a particular emphasis on marketing that appeals to young people and marketing and labeling claims, campaigns and images in order to prevent the public from being deceived or misled.

Adoption of youth access and marketing restrictions of the 1996 rule to help reduce youth tobacco use. To avoid the unnecessary waste of taxpayer resources and bring about quicker results, the legislation should incorporate the substance of the youth access and youth marketing rules set out on pages 44615 through 44618 of Vol. 61 Federal Register dated August 28, 1996 and adopted by the FDA so that the agency will not need to go through a new rulemaking process to implement them. This will bring both speed and certainty to the process.

Health information disclosure. FDA should be entitled to receive all documents and information in the tobacco industry’s possession relating to health effects of all tobacco products, nicotine and its effects on the body, addiction, marketing to children and its effects, and such other information that the HHS Secretary deems necessary to enable the FDA to protect the public health.

"Public health" standard. The existing FDA standard for approving drugs and devices is whether there is a "reasonable assurance that a product is safe and effective." Because there is no such thing as a safe cigarette, the proposal adopts a "protection of the public health" standard for all tobacco products that refers to reducing health risks to the American public. This provides protection for those concerned about a "ban" that FDA won’t just "ban" tobacco products because they are not "safe." For those concerned that FDA have adequate authority to reduce the number of people harmed by tobacco products, including existing tobacco products, this standard keeps the focus on health.

To be certain that FDA keep its eye on the big picture, this standard should require that in deciding what promotes the public health, consideration should be given to the overall impact of a proposal on public health when considering the population as a whole. This includes a broad range of factors, such as whether a product change or new rule will reduce or increase tobacco use or alter the type of products used and whether it will likely increase the number of new users or decrease the number who quit.

Health warnings and labeling. FDA should have authority over health warnings on tobacco product packages and advertisements, including the power to revise and add health warnings and to alter their format, including, but not limited to changing their size, location, and color. Four years ago as part of their 1997 negotiations with the state attorneys general the tobacco industry agreed to a revised set of warnings and a new warning format that were consistent with the warning system then in effect in Canada. These warnings and format should be included in the legislation to avoid an initial long and costly rulemaking process.

Disclosure of ingredients. FDA should have the authority to require the tobacco industry to provide a complete list of all tobacco ingredients and additives, by brand and by quantity, and the authority to require that this information be given to the public in a manner that does not disclose legitimate trade secrets. It should provide FDA with authority to regulate the use of any ingredient or additive that is harmful or which contributes to the harmfulness of the product. As is the case for the manufacturers of all other products, the burden should be on tobacco manufacturers to demonstrate that each ingredient and additive is not hazardous in the quantity used under the conditions of intended use. The issue should not be whether the ingredient makes the product more harmful than existing products; it should be whether the ingredient causes harm. The goal is not to maintain the status quo; it is to reduce the number of people injured.

Authority to reduce or eliminate harmful components. The technology already exists to remove many of the components of manufactured tobacco products that are known to cause harm. FDA should have the authority to evaluate scientifically and then through notice and comment rulemaking, the standard process, to decide whether to reduce or, where appropriate, eliminate the harmful and/or addictive components of manufactured tobacco products in order to protect the public health. This process will give farmers, public health representatives, manufacturers, consumers and other stakeholders an opportunity to bring to the attention of the agency the impact of any specific proposal on their particular needs and concerns. This authority should not be limited to ingredients added by the tobacco manufacturer where the technology exists to reduce or eliminate a harmful constituent of the product or its smoke. This authority should focus on health considerations and not seek to reduce tobacco use by requiring the addition of an ingredient simply because it negatively impacts on the product’s taste.

A benefit for farmers, responsible manufacturers and public health representatives of this authority residing in the FDA is that FDA’s rules provide for input from any interested party and organization and require FDA to review and take into consideration the comments it receives. FDA’s rules also provide protection against arbitrary and capricious action. The creation of the Tobacco Grower Advisory Board will further ensure that farmer concerns are aired and considered prior to the rule-making process. Thus FDA authority provides predictability and an opportunity for farmers, the public health community and others to be heard when the FDA is considering the adoption of a rule setting a safety standard for manufactured tobacco products that farmers believe may impact them. It specifically means that farmers will have an opportunity to bring the impact of any proposed action on America’s tobacco farmers to the attention of the agency prior to the adoption of such a rule and that obligations imposed by the agency to reduce harm will be imposed only after careful consideration of all relevant factors brought to the agency’s attention, including those raised by farmers.

Health claims and "reduced risk" products. FDA should have the authority over products that purport to reduce consumer health risks or serve as less harmful alternatives and the authority to evaluate scientifically whether these products are actually "less harmful" taking into consideration both individual consumers and the population as a whole. FDA’s authority should prohibit or restrict directly or indirectly:

(1) unsubstantiated health claims and

(2) false or misleading claims.

No FDA authority over tobacco farms or tobacco growers. The legislation should recognize that it is USDA and not the FDA that has authority over tobacco farms or tobacco growing.

Recommendation: Include tobacco-cessation in basic Medicaid and Medicare coverage. As the nation’s largest health care purchaser, the federal government has a vital role to play in promoting effective, affordable smoking-cessation services that will assist those tobacco users who want to stop. Research consistently shows that smoking cessation saves lives and reduces smoking-related health care costs and is one of the most cost-effective health interventions available. Neither Medicare nor Medicaid provides reimbursement for some of the most effective smoking-cessation treatments recommended by the Department of Health and Human Services’ Clinical Practice Guideline for treating smoking cessation.

We recommend that funding for smoking cessation be included in basic Medicaid and Medicare coverage. One goal is to help lower-income people stop smoking or consuming other tobacco products. And Medicaid coverage is an especially effective way to reduce smoking among young pregnant women and new mothers, thereby avoiding smoking-caused health care costs for the mothers and their babies.

Studies indicate that comprehensive cessation assistance through Medicaid will reduce overall state health care costs and state Medicaid costs. At least 24 states have elected to provide some form of tobacco-cessation assistance through their Medicaid programs.

Medicaid should provide both prescription and non-prescription smoking-cessation drugs for its beneficiaries. Current Medicaid law allows states to exclude FDA-approved smoking cessation therapies from coverage, and fewer than half of all states provide coverage for smoking-cessation products in their Medicaid programs. Given that 57 percent of all Medicaid recipients are current or former smokers, Medicaid should provide full coverage for smoking cessation.

We estimate the cost of the coverage to be about $25 million per year for Medicaid and about $75 million per year for Medicare and recommend that these costs be funded from the revenues received from our recommended increase in the federal excise tax on cigarettes sold in this country. This funding would become available after the five-year period for compensating tobacco quota owners and growers has ended.