Why Tobacco Companies Should Reimburse The Government For Health Care Expenses - Essay Example

June 15, Reimbursement Reimbursement is a term used to refer to the process of refunding money to a given party for expenses or losses incurred. Due to the escalating expenses incurred as a result of tobacco usage in the United States of America, there is debate on whether tobacco companies should reimburse the government for health expenses. The aim of this paper is to discuss why tobacco companies should reimburse the government for health care expenses related to tobacco use. Accountability Tobacco companies have, over the years, created an uncontrollable desire to use tobacco products such as cigarettes. Over time, these products have brought about major health challenges to their users ranging from addiction to cancer of the throat and lungs. “ As a result, health expenditure by the government has only been going up without easing.” (Jost, 1). Tobacco companies should help finance the healthcare costs associated with the use of their products. This is because they make profits while the government incurs expenses that could be avoided by simply putting the companies out of business. In order to be appealing to the consumer, companies use enticing words that attract more users. The enticements are in the form of low tar content, mild cigarettes, flavoured cigarettes and misrepresented information on tobacco. This information is widely misleading and depicts the irresponsible nature of tobacco companies, thus, the need to make them accountable for their deeds. These practices are blatantly deceptive, fraudulent, and aimed at misleading active consumers and other potential consumers. This can be done making them refund to the government funds used to treat and cater for tobacco related ailments. Also, tobacco companies go out of their way to make aggressive campaigns to women, youth and minority groups. These funds could, instead, be used in preventing ailments and expenses that result from tobacco use. “Still on accountability, tobacco companies should reimburse the government because they are the reason that tobacco related ailments are prevalent” (Janofsky, Para. 2). They, therefore, should shoulder the blame for the part they play. Apart from this, tobacco companies, as a result of reimbursement, will have to bare their documents to the public. This will allow scrutiny by the public in order to understand how the tobacco industry functions. It will also expose the malpractices that these companies engage that are outside the normal business rules and standards. Thus, “...to ensure accountability, tobacco companies should be given a choice to either reimburse the government for healthcare expenses, or conduct anti-tobacco campaigns, which use up the same profits they make” (“Benefits in Tobacco Deal”, Para. 5). With this, reimbursement promotes transparency in the business where they work towards ridding the country and society of tobacco addicts and especially smokers. In return, the companies provide less reimbursement and make sufficient profits for themselves. Health and financial benefits Reimbursement of the federal government by tobacco companies should be done in order to improve the health of the citizens. It should also be done to reduce the load that the taxpayer has to bear. Calls to reimburse the government have an opportunity to pave the way for the creation of new laws. By passing legislation that controls and regulates the tobacco industry, usage of tobacco and tobacco products will see a decline. This legislation will be very crucial because, the number of people using tobacco products will go down significantly and, thus, those exposed to second hand smoke will also benefit. Of all the people exposed to second-hand smoke, children and pregnant mothers form the bulk. Putting into consideration the effects that cigarette smoke has on children and unborn babies, reimbursement is set to put issues into perspective for tobacco companies. Therefore, reimbursement will promote improved health by reducing occurrences of smoking related accidents, low birth weight in infants and cancerous effects of second-hand smoke. Improved health, in turn, leads to increased productivity and, thus, more financial income, which then translates to more taxes collected by the government and better services delivered. In addition, reimbursement decreases the expenses made by the government towards providing healthcare and, thus, creates an opportunity for efficient service provision. Also, it will decrease mortality rates resulting from tobacco related issues. Shortcomings of reimbursement Reimbursement, despite its positive and valid reasons, should not be done. This is because; it digs into the hard earned profits that they make, and “profits made by tobacco companies are as a result of hard work, innovation and creativity” (“Benefits in Tobacco Deal”, Para. 7). Therefore, making these companies pay for the misconceptions of their products consumers will send a negative message to other manufacturers. The message will be that any company that makes revenue using innovative and creative means will be liable to punitive measure by the government. This implies that other companies both in the tobacco and other manufacturing and processing industries will be weary of making profits as the government will make attempts to reach forward and get them. Instead of taking such punitive measures, the government should come up with a new tax regime in which all companies and corporations are to be taxed according to the revenue they generate, and not on favouritism. In addition, considering that the companies have shareholders, of which shareholders are part of the general public, they will cease making investments in these companies. In turn, the government, and now the general public, will suffer a major blow in terms of the revenue collected by the taxman. Decreased taxes, again, translate into poor services rendered by the government and a negative image of the government. Therefore, tobacco companies should not reimburse the federal government for healthcare cost related to smoking. Another argument that those opposing reimbursement put forward is that of the potential impact it will have on agriculture. For example, the state of Nebraska is known for tobacco farming did not sue for reimbursement with other states, “...this is in fear that asking for reimbursement will set a legal precedent that could hurt agriculture” (Carlson, Para. 9). Conclusion Reimbursement of the federal government by tobacco companies for health care costs related to smoking remains a controversial. This is putting into consideration all factors that are relevant such as its positive effects, as well as the negative. In my opinion, the positive impact of reimbursement outweighs the negative and, therefore, the government should be reimbursed for these costs. Works Cited “Benefits in Tobacco Deal”. Los Angeles Times. 1998. Web. 10 June, 12. Carlson, Brian. State will Receive Share of Reimbursement. 2006. Web. 10 June, 2012. Janofsky, Michael. Mississippi Seeks Damages From Tobacco Companies. 1994. Web. 10 June, 12. < http://www.nytimes.com/1994/05/24/us/mississippi-seeks-damages-from-tobacco-companies.html > Jost, Kenneth. Closing in on Tobacco. 1999. PDF file. 10 June, 2012. . Read More