S 0251 General Bill, By M.T. Rose
 A Bill to establish the South Carolina Tobacco Indemnity Fund to be
 administered by the South Carolina Department of Insurance and financed by
 taxation on tobacco products to be collected by the South Carolina Tax
 Commission, to require the reporting of insurance claims for tobacco smoking
 related disease treatment, to provide for reimbursement from the fund to
 employers for these claims, and to provide that three percent of the fund be
 used for heart or lung transplants for nonsmoking residents.

   10/22/90  Senate Prefiled
   10/22/90  Senate Referred to Committee on Finance
   01/08/91  Senate Introduced and read first time SJ-92
   01/08/91  Senate Referred to Committee on Finance SJ-92
   02/20/91  Senate Recalled from Committee on Finance SJ-2
   02/20/91  Senate  Reconsider introduction SJ-3
   02/20/91  Senate  Introduction withdrawn SJ-3

A BILL

TO ESTABLISH THE SOUTH CAROLINA TOBACCO INDEMNITY FUND TO BE ADMINISTERED BY THE SOUTH CAROLINA DEPARTMENT OF INSURANCE AND FINANCED BY TAXATION ON TOBACCO PRODUCTS TO BE COLLECTED BY THE SOUTH CAROLINA TAX COMMISSION, TO REQUIRE THE REPORTING OF INSURANCE CLAIMS FOR TOBACCO SMOKING RELATED DISEASE TREATMENT, TO PROVIDE FOR REIMBURSEMENT FROM THE FUND TO EMPLOYERS FOR THESE CLAIMS, AND TO PROVIDE THAT THREE PERCENT OF THE FUND BE USED FOR HEART OR LUNG TRANSPLANTS FOR NONSMOKING RESIDENTS.

Whereas, over fifty thousand studies in the last twenty-five years have documented the risks of tobacco; and

Whereas, cigarette smoking has been linked to lung cancer, emphysema, oral and throat cancer, and heart disease; and

Whereas, smokeless tobacco has been linked to both oral cancer and tooth loss; and

Whereas, parents who smoke force their children to become passive smokers thus causing a three to seven percent deficit in lung growth; and

Whereas, of all cancer deaths thirty percent are related to smoking; and

Whereas, smokers have a seventy percent greater risk of heart disease than nonsmokers; and

Whereas, the cost of treating smokers with smoking related illnesses is a large percentage of the state's health care costs; and

Whereas, South Carolina has one of the lowest cigarette taxes in the country; and

Whereas, health care costs are of serious concern to the General Assembly. Now, therefore,

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. As used in this act:

(1) "Package of tobacco" means a unit for sale or distribution of twenty or less cigarettes, pipe tobacco, snuff, or chewing tobacco.

(2) "Carton" means a unit for sale or distribution made up of more than one package.

(3) "Purchaser" means an employer who provides health insurance coverage to his employees through any legal plan of insurance, self-funded or otherwise, and which provides coverage for tobacco related diseases. The Medicare program as defined by Title XVIII of the Social Security Act is not included in this definition. This definition includes the state Medicaid program and persons for whom payment is made for their health care through this program.

(4) "Tobacco related diseases" means a primary diagnosis of carcinoma of the lungs, throat, or mouth, emphysema or heart disease, peripheral vascular disease, or stroke.

SECTION 2. There is established the South Carolina Tobacco Indemnity Fund to be financed by a tax of fifty cents a package of tobacco or five dollars a carton of tobacco.

The fund must be administered by the South Carolina Department of Insurance with reasonable administrative costs being paid from the fund. The tax must be collected by the South Carolina Tax Commission.

SECTION 3. (A) Within ninety days of the end of the state fiscal year all purchasers of group health insurance plans must submit to the Chief Insurance Commissioner the total dollars paid during the previous state fiscal year for claims on behalf of persons in their plan who have smoked for more than five years and were treated for a tobacco smoking related disease as the primary cause of the illness.

(B) Within one hundred ninety days of the end of the fiscal year the Chief Insurance Commissioner must calculate the percentage of total claims incurred by each purchaser who filed a report and must refund an equal percentage from the Indemnity Fund to the purchaser but not to exceed the amount reported.

SECTION 4. Three percent of the fund must be withheld annually to provide funding for heart or lung transplants for nonsmoking residents of the State.

SECTION 5. This act takes effect upon approval by the Governor.