Colorado Gubernatorial Candidate Would Increase Cigarette Tax To Fund Health Coverage Expansion

Colorado Democratic gubernatorial candidate Rollie Heath on July 17 unveiled a $2.5 billion health proposal to be funded by a $1 per pack increase in the state's cigarette tax, the Colorado Springs Gazette reports (Henley, Colorado Springs Gazette, 7/18). Under the "Heath Health Care Initiative," the state would provide $100 million annually for 10 years to help small businesses provide health coverage (Heath release, 7/17). The state would pay 50% of the cost of insurance up to $1,000 per covered worker (Denver Post, 7/18). The plan would also provide $100 million annually for 10 years to help seniors pay for prescription drugs (Heath release, 7/17). Seniors earning between $10,000 and $25,000 for a family of two would have up to half of their drug costs subsidized under the plan (Denver Post, 7/18). In addition, the plan would earmark $30 million annually for 10 years to fund prenatal care and health care services for children until they are 2 years old, and it would set aside $27 million a year over 10 years for administrative expenses and future health care projects (Heath release, 7/17). Colorado has not increased its cigarette tax since 1986; voters defeated a ballot initiative in 1994 to raise the tax by 50 cents. Heath said that "[t]imes have changed" since 1994 and that voters are more likely to support a cigarette tax increase to support health care programs. "It's time we stop talking about how difficult it is to solve the health care problem and challenge and start helping Coloradans to get the help they need and deserve" (Colorado Springs Gazette, 7/18).

Denver Post Response
Although Colorado has a "real and growing problem of families without health insurance," Heath's health care plan would "only alleviate the problem, not solve it," according to a Denver Post editorial. The Post writes that the plan to subsidize the insurance costs of small businesses that already offer health coverage would "further dilute what is already an inadequate fund" and would cover only one out of nine employees. In addition, the Post questions the ability of the state to provide prescription benefits for seniors, saying it is a national problem that Congress should address. The Post also notes that voters may not approve a cigarette tax, given that the tobacco industry would be likely to oppose it with a "high-powered blitz of negative ads." Despite these concerns, the Post concludes, "Heath undoubtedly deserves credit for putting the problem of insured workers squarely on the public agenda" (Denver Post, 7/18).