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  • Title: The financial implications of coverage of smoking cessation treatment by managed care organizations.
    Author: Warner KE, Mendez D, Smith DG.
    Journal: Inquiry; 2004; 41(1):57-69. PubMed ID: 15224960.
    Abstract:
    This paper presents results from a simulation of the financial impact and cost effectiveness of smoking cessation in a hypothetical managed care organization (MCO), using data from three large managed care organizations and from existing literature. With base-case assumptions and a market cost of capital, at five years, coverage of cessation services costs an MCO dollars .61 per member per month (PMPM). In a steady-state situation, net cost is dollars .41 PMPM. Both values include altered medical expenditures and MCO revenue patterns attributable to coverage-induced cessation. Quitters gain an average of 7.1 years of life, with a direct coverage cost of dollars 3,417 for each life-year saved. Coverage of cost-effective programs by MCOs should be strongly encouraged.
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