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SMOKING: A CHALLENGE TO WORKSITE HEALTH MANAGEMENT Anne Kiefhaber & Willis Goldbeck INTRODUCTION New knowledge about the medical, economic, and human costs of smoking has com- bined with growing public awareness of the problem, and with empirical evi- dence of the return-on-investment from smoking control policies and programs, to indicate that we stand at the threshold of real progress. This brief paper examines one aspect of our effort to cross that threshold and counteract the smoking menace: Smoking Control at the Worksite._ Worksite programs are a response to the convergence of several factors: 1. People spend a very large portion of their lives at work and thus are "reachable" in this setting. 2. Employers have a large number of incentives to help employees stop, or reduce smoking. 3. The early leaders in worksite programs realized considerable success, using a variety of measures, and thus provided models for their less adventurous business brethern. 4. Pressure for employer action has been increasing from government (OSHA), the media (lots of positive attention paid to those with programs), wor- kers (agitation for smoke-free environments), and the courts (which have spoken both for and against anti-smoking policies). 5. Awareness about the cost of smoking is increasing as is the availability of community resources to which a company can turn for assistance. The American Cancer Society, Lung and Heart Associations, hospitals, YMCA, and various proprietary firms are actually competing to provide smoking ces- sation resources to business. Growing employer involvement mirrors the increased attention being given to the smoke-free environment movement through our society. Surveys report a 'decline in the portion of the population that smokes, and there are ever-in- creasing smoking restrictions in elevators, restaurants,,airplanes, and even business meetings. The message is clear: societal values are making the smoker increasingly out of vogue. We must be careful, however, not to be entfapped by the appearance of success. The fact remains that only a fraction (39.) of all employers actually have or sponsor smoking programs. And, far fewer have taken the more important step of creating a corporate smoking policy with the concomitant action strategy. TIMN 0086513 1Danaher, Brian, G. PhD., "Smoking Cessation programs in Occupational Set- tings", Public Health Reports, March-April 1980, Vol. 95, No. 2. -128- 13~,~4 '~

Throughout the paper, we are speaking of corporate policies and programs. The latter are courses, classes, or systems provided by the company, or by an out- side agency, that seek to help employees reduce or stop their smoking. By policy, we mean a corporate position that may be as simple as a policy that no smoking will be allowed or as complex as a total strategy for creating a smoke -free environment and assisting employees to stop smoking through the provi- sion of specific programs. Many barriers to program enhancement and expansion can be identified. Even here, the problem is hard to define. Barriers to a smoking cessation program may include the absence of a corporate smoking policy. However, the attain- ment of such a policy is dependent on overcoming other barriers that, by them- selves, may have no impact upon the decision or ability to conduct a specific smoking program. Further, the barriers vary according to the location of the worksite, its leadership, type of products, other demands on resources, and factors which are exogenous to smoking, but very relevant to corporate de- cision making. In the pages which follow, the authors, both of whom work for the Washington Business Group on Health and do private consulting in the health field, will give the participants in the American Cancer Society's Conference on "Smoking OR Health" a review of the literature, statistics, trends, and case examp'les of' smoking control at the worksite. Barriers to smoking control are discussed and the paper concludes with recommendations designed to fuel conference dia- logue. GOAL, OBJECTIVES, AND BARRIERS An initial task for the Conference workgroup is to reach agreement on the pri- mary goal for worksite smoking policies and programs and, subsequently, to prioritize a set of objectives to support the goal. Once this is done, the most harmful barriers can be identified and appropriate solutions selected. Following are a goal, objectives, and barriers presented to stimulate--perhaps guide-the Workshop.dialogue. GOAL: To reduce smoking at the worksite. Justification: This is the only goal statement that encompasses all the varied employer motivations for worksite programs or policies. • OBJECTIVES: (the attainment of which would support the above goal) A. To have more employers establish smoking reduction 1) policies 2) programs 5~~~5 TO3~~~~ TIMN 0086514 -129-

B. To reduce corporate expenses as measured by 1) medical benefits 2) absenteeism 3) other insurance costs 4) safety and product quality 5) productivity 6) janitorial/maintenance NOTE: These are also by-products of attaining the goal. C. To provide a service for employees in response to 1) their demand 2) feeling of corporate responsibility BARRIERS: The barriers are a synthesis of those that appear most frequently in the literature, in the four surveys discussed in this paper, and in inter- views conducted by Anne Kiefhaber. All relate to the difficulties of estab- lishing policies: some also hinder program development. 1. Cost. Cost is the most frequently reported barrier. The problem is com- pounded by the desire of many very large employers to provide benefits in which all can participate equally. Comment: This seems more an excuse than a true problem, especially with reputable programs available at little or no cost from such organizations as the American Cancer Society, the Heart and Lung Associations, and other voluntary organizations. Even the highest cost program (Campbell Soup's $500 per quit) is very inexpensive compared to the medical or administra- tive cost savings. 2. Lack of Knowledge. Surveys show that a remarkably 9mall percentage of the population know and believe the dangers of smoking. Similarly, many em- ployers simply do not have sufficient information to really understand the issues--and potential benefits--at the level where they would feel com- fortable making the decision to initiate a policy or program. Comment: It is the absence of accurate, timely, and comprehensive infor- mation that feeds the perpetuation of such myths as: "We do not have proof that smoking is the direct cause of disease", or "How do we know the program will be cost effective?" This barrier is especially difficult to overcome when the corporate leaders are smokers and, thus, find "ignor- ance" to be supportive of their own lifestyles. 3. Resources. Many large communities have a wide range of programs competing for corporate reimbursement. However, many others are "resource poor". Comment: Employers are reluctant to get into the smoking control business, preferring to wait for community resources to which employees can be referred. This barrier is falling to the growth of new prc+grams in 2 Fullerton, Jane, Paper for the ACS Conference Smoking OR Health, Fall 1981 -130- TIMN 0086515 T013" ~~,,646

pursuit of corporate dollars and to the leadership of such companies as IBM whose wellness strategy supports community resource development that subsequently is available to other employers. 4. Effectiveness. Not enough is known about those programs that work and too much attention is paid to those that either fail or are marginal. Many employers claim to be waiting for proof of effectiveness before offering any program. Comment: Employers do not agree upon what constitutes success. a) high levels of participation b) reduced smoking c) quit rates, for specified durations d) increased awareness of health hazards e) other measures of benefit to the company 1) reduced cost 2) improved morale They are equally uncertain about the cost factors that should be "charged" to the smoking program. Finally, it can fairly be said that the cost- effectiveness ratio is of less significance than developing easy to under- stand measures by which programs can be compared. Employer-employee com- munication is another element of the effectiveness issue. Regardless of the smoking cessation program used, success will be significantly deter- mined by the methods the employer uses to communicate the importance of participation to the employees. If dependents are to be included, this is all the more complex. 5. Labor-Management Relations. Many employers shy away from establishing no- smoking policies or urging participation in smoking cessation programs be- cause they fear employee opposition. This opposition is compounded when labor unions attack management for using smoking programs as a cheap es- cape from major investments in worker safety. Comment: No doubt, some employers may have attempted to use smoking pro- grams as the unions suggest. Such unconscionable acts can never be de- fended, even by other employers. As exceptions, however, these instances should not become the guide for labor-management relations on the smoking issue. The facts demand a different perspective and a cooperative labor- management approach. Fact:. It is acceptable to ban any employee behavior that is known to be unsafe to either that worker or fellow workers. Smoking is clearly such an activity. Fact: For employees who work in high-risk environments, no matter how lax the employer has been, the facts are that the employees who smoke are far more likely to become ill or die than are their nonsmoking compatriots. (97 times more in the case of asbestos workers, for example.) 131- TIMN 0086516 -131- rf

Therefore, the facts urge a new definition of employee benefits, one which stipulates that a no-smoking policy is a labor-management accomplishment of which both sides can be proud,even if some individuals are inconven- ienced. 6. Liability. Concern for liability if employees do smoke in a high-risk environment is a stimulant for no-smoking policies; concern for liability if nonsmoking policies are interpreted as an infringement on empioyees' rights is an excuse for delaying or rejecting such policies. Comment: Until the courts become consistent in their decisions, many em- ployers will remain reluctant to set restrictive policies. This is the larger issue since most employees do not work in high-risk environments. If we are to meet our goal, it will be necessary to encourage smoking ces- sation programs on the basis of an employee health benefit freely selected and, simultaneously, to develop a unified labor-management approach to the courts. In order to posit strategy for business leaders to remove these barriers, it will be useful to arrive at a common understanding of the health and economic aspects of smoking, and of the current state of corporate activities. THE PROBLEM What is the problem? At first the answer seems so simple: smoking. However, when trying to come to grips with smoking at the workplace-,.the problem be- comes more nebulous. Several problems are identifiable: 1. The health consequences (and resulting financial consequences) for employ- ees who smoke. 2. The costs to the company of employees who smoke. 3. The lack of smoking cessation programs for workers. 4. The lack of corporate smoking policies such as those that prohibit smoking in all but selected areas. 5. Values related to employee rights, privacy, and dependent involvement in company programs. 6. Labor-management relations. Though all o,f the above problems are related, each has its own complexities, barriers, and solutions. THE HEALTH CONSEQUENCES OF SMOKING Human capital is every nation's greatest asset. who comprise the workforce directly affects the that product may be. Approximately 33% of the working population is able cause of death and disability: cigarette quences are awesome: 3The American Cancer Society -132- The well being of the people final product, no matter what addicted to the most prevent- smoking.3 The health conse- TIMN 0086517 r a3,~48 f

.325,000 early deaths from cancer, and other diseases of4the lung and circulatory system are attributed to smoking each year. .Smoking is related to 90'/% of all lung cancer cases; 30% of arterio- 5 sclerosis cases; 75% of bronchitis cases; and 807. of emphysema cases. .Smokers have twice the risk of death due to coronary heart disease, and 10 times the risk of developing lung cancer. They also have longer con- valescent periods from respiratory infections and, if surgery is requ~r- ed, are more likely to develop post operative respiratory infections. Smokers are, therefore, far less healthy workers than nonsmokers. The effects of unhealthy workers are felt at the worksite in many ways: increased absent- eeism, less than optimal productivity, increased medical costs, and early loss of workers through premature death. THE ECONOMICS OF SMOKING The economics of smoking, for the individual, is a subject of little interest and is often reduced to mere concern for the price of a pack of a favorite brand. Tb a significant degree this is due to employer-based health insurance which hides the real cost of ill health that can be attributed to smoking. For employers, however, and those who are in positions to make resource allo- cation decisions, the economics of smoking are sufficiently staggering that anyone responsible for a"Bottom Line" is left with one unmistakable conclus- ion: reducing, much less stopping, smoking is virtually guaranteed to produce a very welcome return-on-investment. Statistics and studies abound. Consider just these few which give a collec- tive view of the magnitude of the opportunity facing the stop-smoking effort. 1. Each year, over 80,000,000 work days are lost due to smoking.7 2. Using $190.90 as an average weekly wage, the government estimateg that some $3 billion was lost in 1977 to cigarette related illnesses. 3. Using 1980 dollars, Dr. Kristein of the American Health Foundation and NIH, has estimated that.the total annual cost of cigarette smoking is $47.5 billion. This represents a loss to our community of $1.56 for every pack smoked, not counting the actual cost of cigarettes themselves. Of the $47.5 billion, $11 billion is excess medical expenses incurred by smokers (the cost of illness to exposed nonsmokers is not even included); and $36.5 billion is indirect cost que to early death, premature retire- ment and losses due to absenteeism. 4The Smoking Digest, U.S. Department of Health Education and Welfare (DHHS), 1977. 5Ibid. 6lbid. 7The Smoking Digest, op.cit. 8The Smoking Digest, op.cit. 9 TIMN 0086518 Kristein, Marvin, M., Ph.D., "How Much Can Business Expect to Earn From Footnote Cont'd -133-

10 per year. 4. Each smoker costs his or her employer approximately $624 These are totally wasted dollars that could otherwise be given to the employees as compensation or improved health benefits, shared with stockholders, or otherwise allocated to business development for a stronger national economy. The $624 consists of: A. Excess insurance costs $274.00 1) health ($204) 2) fire ($10) 3) worker's compensation ($40) 4) life and disability ($20-$35) B. Absenteeism 80.00 Smokers average 33-45% more absenteeism than nonsmokers C. Reduced productivity •166.00 Smokers have increased eye irritation and carbon monoxide levels, reduced attentiveness, lowered cognitive and exercise capacity that has been measured to cost each smoker 8 minutes per day of productivity D. Involuntary smoker impact 104.00 -insurance ($55.00) -other (149.00) 5. For those who believe the health and productivity measures are too ob- scure, the experience of Merle Norman Cosmetics provides a simpler measure that any employer can quickly understand. They estimate savings in a small plaq in excess of $13,500 in 1976 as a result of reduced janitorial services. Similarly, the work of Weis and Fleenor found that "employers expected to save at least $500 per smoker per year from incremental replacement of furnishings and equipment, not counting occasional patch-up work on re- cently acquired cf1peting which, according to Unico, can run as high as $100 per repair." Smoking Cessation", presented at the National Interagency Council on Smoking and Health's Workshop: "Smoking and the Workplace", January 9, 1980, Chicago, IL. lOIbid 11Kelliher', E.V.: Fewer workers now are singing "Smoke Gets In Your Eyes", Wall Street Journal:1 and 33, November 7, 1978 12Weis, William L.: "Can You Afford to Hire Smokers", Personnel Administra- tor, May 1981. ~ -134- 1 ;)V..~.:!d,'6 TIMN 0086519

6. Insurance companies, by offering premium reductions in life, health, fire, and casualty policies, offer the final proof that nonsmoking actually pays off. These companies base their decision on data, actuarial analysis, and "impirical evidence based upon the experience of many thousands of policy holders. Although not yet a majority, the trend toward these incentives is growing. 7. New York Telephone estimates an annual savings in absence and treatment costs for smoking related diseases of $645,000 for cardiovascular diseases and $1,400,000 for pulmonary diseases. This is not taking into account the iTgact on well-being, productivity and roughly 15 lives saved annu- ally. 8. Finally, another composite look at the costs, per smoker, to employers as compiled by Weis: Additional Annual Cost of Employing Smokelr4s and Allowing Smoking at the Work Place. Cost Sources Annual Cost per Smoker Absenteeism $ 220(a) Medical Care 230(b) Morbidity and Early Mortality (discounted lost earnings) 765(b) Insurance (excluding health) 90(c) On-the-Job Time Lost 1,820(a) Property Damage and Depreciation •500(d) Maintenance 500(d) Involuntary Smoking 486(c) Total Cost Per Smoker per year`, $4,611 All costs are in January 1981 dol~lars a) Assumes that total personnel cost to employer, including fringes and payroll taxes, equals $20,000 per employee. b) Based on Luce and Schweitzer (1978) adjusted for 1981 dollars c) Based on Kristein (1980) adjusted for 1981 dollars d) Based on interviews by author (Weis) e) Based on White and Froeb (1980), Wynder and Stellman (1977), and Luce and Schweitzer (1978) Trying to satisfy the skeptic that all these studies are accurate is a battle best left unengaged. One fact remains unchallenged: no matter how it is mea- sured, smoking is a terrible drain on our economic resources, the limits of which we are increasingly aware of. 13Wood, Loring, M.D., "Lifestyle Management Strategies at New York Telephone", Unpublished paper presented at the "Leadership Strategies Health" Conference at the Institute for Health Policy Study, Project Hope, 1980. 14 Weis, op.cit., p.77 -135- TIMN 0086520 T 0 3~w~51

Faced with the economics of smoking, it becomes difficult to claim our country cannot afford to provide basic health and medical services, or to call for sa- crifices in social programs and employee compensation when we do so little to stop a minority of our population from wasting so much. THE LACK OF SMOKING PROGRAMS FOR WORKERS Programs to assist cessation A concise definition of what constitutes a smoking cessation program compli- cates reporting the magnitude of the problem. Three separate surveys of employers reported the percentages of worksites with programs differently: 1. A survey of 128 large companies in Massachusetts reported that 8% of the surveyed companies provided counseling for those employees who wished to quit smoking; 12% or ten companies had provided programs for those who wished to stop smoking; two were onetime lectures, three were operated by the Seventh Day Adventists, and five by SmokEnders. Eight of the ten were run on employses' own time and only three employers paid part of the pro-, gram's cost. 2. The National Interagency Council on Smoking and Health surveyed 3,000 com- panies of varying sizes and locations. The survey reported that 14.7% or 124 of the responding companies indicated that they have or had a health education or promotion program on smoking. These programs took the fol- lowing shapes: -•32.3% were physician counseling ~ 33.1% were other counseling - 56.5% were "How to Quit" materials - 22.67. were single-sessioniglinics - 10.5% were in other forms 3. The Washington Business Group on Health survey of its member companies reported P%of the responding corporations had a "smoking cessation program." Generalizations about educational material and smoking control courses offered at the worksite can be made: 15 Bennett, Diane, Med. and Barry L. Levy, M.D., "Smoking Policies and Smoking Cessation Programs of•Large Employers in Massachusetts", AJPH June 1980, Vol. 70, No. 6. 16 The National'Interagency Council on Smoking and Health, "Smoking and The Workplace, A Business Survey", December, 1979. 17 The Washington Business Group on Health,-"A Survey of Industry Sponsored Health Promotion, Prevention and Education Programs." December, 1978. ; TIMN 0086521 -136- ~ ^ ~ T03.Sti

.most are on a onetime only or sporadic basis .most are implemented through the medical departments (699% according to the WBGH Survey) .companies with more than one location leave the decision to have a pro- gram to the discretion of each location .most companies use outside resources to conduct the programs. Fre- quently used are the American Cancer Society, American Lung Associa- tion, American Heart Association, SmokEnders, and hospital programs such as the Seventh Day Adventists. .if a fee is attached to a course, employees are usually responsible for the payment. When the company does make a financial contribution, it is usually only a portion of the total cost. .most programs are not conducted on company work time. Corporate Examples: High Risk & General Programs Campbell Soup Company: The Campbell Soup Company offers employees, in almost all of its locations, opportunities to participate in a smoking cessation pro- gram. In addition, most all locations publish information about smoking in the corporate newspapers and offer self-help pamphlets with nurse support for employees who would like help to stop smoking without participating in a for- mal course. Many of the locations contract with local providers for the courses. The cor- porate office contracted with the Center for Behavioral Medicine at the Uni- versity of Pennsylvania to conduct a series of smoking cessation classes and to train the corporate staff to conduct the programs in the future. The pro- gram was designed to attract a large number of participants. Campbell Soup had 71 employees enrolled in the most recently offered program. The company paid $30 of the program costs while the employee paid $20. Time for the program was split, half on worktime and half on the employees' time. After one year, 207. of the participants were nonsmokers. Dr. Roland Wear, the corporate medical director, attributes the relatively low success rate of the program to its emphasis on attracting large numbers of "hard core" smokers rather than only those who are already dedicated to giving up the smoking habit. The cost of the program to the company was estimated to be $500 per successful employee. The laf§est cost contributing to this figure was the employees' time off the job. IBM. IBM Corporation recently launched a health promotion program for all of its employees, retirees, and their dependents (with some restriction on the third group). Smoking cessation is included in the package of programs to be coordinated with a community group and offered to IBMers. If a given location cannot arrange for a course to be taught, or if an eligible person cannot par- ticipate in an arranged program, they may receive up to $75 tuition reimburse- ment for attending a course designed to help smokers understand their habit 18This information was gathered through a phone conversation with Dr. Roland Wear, Medical Director, The Campbell Soup Company. -137- TIMN 0086522 TO3~~~53

and to learn new behavior patterns in order to stop smoking.19 The IBM "Plan for Life" also distributes the American Lung Association's booklets: "Freedom From Smoking" and "A Lifetime of Freedom From Smoking." Corporate Examples: Incentive Programs A handful of employers offer employees incentives not to smoke. Only 1.1~ or 9 of the companies which responded to the NICSH survey offer incentives. The companies that have tried the incentive approach have successfully reduced the percentage of smokers in the population. Most of the companies which sponsor incentive programs are small. One exception, Dow Chemical, is a major employer which reports great success. Dow Chemical Co. Dow Chemical Company discovered, in an internal study, that smokers were absent 5.1 days per year more than nonsmokers. This cost the company an estimated $500,000 each year. The response was the implementation of a variety of smoking cessation programs within the company. The Texas Operating Division launched a one-year lottery aimed at smokers. Smokers who quit earned one chance, for each month of abstinence, to win a motorboat val- ued at $2,400. In addition, abstinence earned workers a weekly bonus of $1 and a chance to win a $50 quarterly bonus. At the same time, a lottery for recruiters was established. Employees could recruit fellow workers to stop smoking. Each month the individual ref=ained from smoking, the recruiter won a chance for the motorboat. Of the Texas Division employees who smoked, 24'/. were recruited into the pro- gram. At the end of the year, 76% of the recruited employees did not smoke. Though the incentive program ended in 1975, Dow has continued to provide indi- vidual counseling during visits to the companyr2T edical department, periodic lectures, and presentations on smoking issues. Speedcall Corporation. Speedcall Cozporation offers its 35 employees $7 per week in extra pay if they choose to not smoke. The program is operated on an honor system and is voluntary. If an employee "backslides" and smokes one week, he is still eligible for the benefit in subsequent weeks. All employees are free to smoke during working hours; hence smokers are in no way penalized. The program operates on the philosophy that by rewarding nonsmokers with mone- tary incentives combined with peer pressure, smoking will be reduced.. The company reduced the percentage of the workforce that smoked by 70°~ and is saving an estimated $38 per employee in net resources. This figure excludes the financial transfers which the company treats as salary increases. On average, 74% of the employees receive an amount that averages $286 per year. Hence,the total cost of the program is $240 per employee. Other benefits in- clude: 97% of the employees thought the program was a good idea; cigar2~te consumption declined by 59%; and life expectancy increased by .8 years. 1-"A Plan for Life", the IBM Health Education Program, 1981. 20The National Interagency Council on Smoking and Health, op.cit. 21lnformation obtained during conversation with Dr. Fishbeck, Medical Director of Dow Chemical, Texas Division. 22Shepard, Donald S., Ph.D., "Non-Smoking Survey", the Speedcall Corporation, -138- T 40 TIMN 0086523

Gardner Hempel, the President, reported that absenteeism went down, there was less illness, illnesses were of shorter duration, and productivity went up following the implementation of the smoking program. In addition, the comp23y almost doubled its volume, with the same number of employees, in two years. Other companies that have offered incentive programs include:24 Cyberteck Computer Products,Inc. offered employees $500 to quit smoking. Vaughn Morgan, the President, estimated employees spend 3`/% of the workyear smoking. Using $22,500 as an average salary, he decided smoking cost his company $675 per year per smoker. City Federal Savings & Loan Association in Birmingham, Alabama has offered its 185 full-time employees $20 per month for not smoking. In 1977, $40,000 was paid to the 166 nonsmoking employees. Intermatic Inc. In 1976, President James Miller bet the employees up to $100, with the opportunity to double their money, to stop smoking for one year. Twenty-five winning employees received a total of $2,815 while 45 losers gave $1,105 to the American Cancer Society. Corporate Examples: Insurance Incentives Life, health and fire insurance rates are dramatically affected by smoking. Yet,few insurance companies offer incentives to individuals or employers to reduce this harmful habit. In discussions with the authors of this paper,sev- eral corporate•representatives indicated that their company would respond to financial incentives, such•as reduced premiums. For example, representatives from Bank of America indicated that a definite savings in the form of premium reductions could be the pivotal factor towards establishing smoking restrict- fons. Life Insurance. The statistically proven link between smoking and decreased life expectancy has led more than thirty life i2sburance firms to offer lower premiums on individual policies for nonsmokers. The Phoenix Mutual Life Insurance company offers a nonsmoker a discount on group life coverage for businesses with fewer than ten employees. Participa- ting employees must not have smoked for 12 months before enrolling in the plan. Phoenix Mutual reserves the right to verify the individual's smoking habits. 2~he discount ranges from 6% to 22%, depending on the employee's age and sex. August 1980. 23Fie1ding, Jonathan F.,'M.D., "Preventive Medicine and the Bottom Line", Journal of Occupational Medicine, Vol. 21, No. 2.1, February 1979. 24Kelliher, Eileen, V., op.cit. 25 Fielding, op.cit., Appendix A. 26 Business Insurance, June 15, 1981, p.19. -139- r ~ W3 TIMN 0086524

Fire Insurance. Though cigarettes are the cause of a substantial number of fires, few insurance companies are known to offer premium reductions for pla- ces of employment with smoking bans. Merle Normal Cosmetics was unsuccessful in negotiating a premium reduction following the implementation of their smo- king ban. .Conversely, Robin Woodward, owner of two restaurants in Seattle,negotiated21 25% premium reduction from Safeco Insurance company on her fire insurance. Health Insurance. Though the evidence that smoking causes illness is abun- dant, health insurance companies are reluctant to offer premium reductions for nonsmokers. Policy holders that are experience rated or self-insured realize premium reductions through lower utilization of medical services by nonsmo- kers. Purchasers of community-rated plans will not reap the benefits unless the entire community reduces their medical utilization. Therefore, the great- est need for direct premium incentives in health insurance'is for nonsmokers who need individual coverage or participate in community-rated plans. CORPORATE POLICIES THAT PROHIBIT OR RESTRICT SMOKING The NICSH survey reported that 49.6% of the responding companies had a smoking policy which restricted or prohibited smoking. The policy was instituted on a corporate-wide basis in 297. of the cases, while the others left this decision to each location. The policies restricted smoking in the following ways: Area No Restriction Restriction in. Designated Areas Complete Prohibition Dining 79.6% 18.5% 2.0% Blue Collar Areas 30.6% 42.07. 27.5% White Collar Areas 74.3% 15.2% 10.5% Conference Rooms 87.3% 6.2% 6.5% Medical Facilities 60.7% 14.7% 24.7% According to the survey report, restrictions are imposed primarily because of safety and health regulations. For example, smoking is prohibited in areas containing flammable goods, where food is prepared, or where workers come in contact with chemicals proven to have a hazardous, synergistic effect with smoking. This is one re29 on why more restrictions are imposed in blue collar than white collar areas. The Dartnell "Target Survey" reported that 23% of the 325 U.S. companies had a current policy covering smoking in the office in 1980. This was a 7% decline from a similar survey conducted in 1977. Elements of these policies include: 27Weis, op.cit., p.78. TIMN 0086525 28The National Interagency Council on Smoking and Health, op.cit. -140- T ~3 *26 5 £

- 18% restrict office smoking to certain designated areas - 87. have instituted special seating arrangements for smokers and non- smokers - 57% schedule breaks for smokers and nonsmokers29 The'Bennett and Levy survey found that 64% of the responding corporations (84) had designated work areas where smoking was prohibited. The two main reasons for establishing the policies were listed as: possible danger to products or equipment (91%), and direct contact with a client (17%). None of the respon- dents 1 18 ted the hazard to worker health as a reason for their nonsmoking policy. The current motivation for implementation of a no-smoking policy is to protect the quality of products or services rather than the health of the employees, according to these surveys. This finding is reinforced by the fact that most companies provide space where employees who work in a restricted area may smoke when they are on a break. The Bennet and Levy study reported that 80 percent of the companies with nonsmoking areas or nonsmoking jobs offered two or more smoking brea!ff daily for workers in these areas or jobs. The breaks averaged 15 minutes. Few companies extend the restrictions to employees who come in contact with neither the product nor the clients. The lack of restrictions on management staff is a prime example. Policy Considerations One of the barriers to implementing smoking regulations is that most companies are not adequately sensitized to the severity of the smoking menace and,thus, to the numerous reasons for prohibition of smoking. In addition, a body of experience is slowly developing that will influence future efforts to reduce the barriers to policy and program development. 1. The costs associated with smoking. Despite the overwhelming evidence of the otherwise unnecessary costs incurred by both employer and employee due to smoking, surveys show that few companies have used cost as the justifi- cation of a smoking program. One example of a company that recognized the costs of smoking and subsequently implemented a smoking ban was Merle Normal Cosmetics. The ban, which included all areas of the worksite ex- cept part of the cafeteria, was implemented in 1976. The company predic- ted they would save $36,000 during the first year of no smoking. Some of the costs included in this calculation were: the elimination of the cost of janitors emptying ashtrays and cleaning around them in all of the executive offices four times per day; reducing the need to clean and paint walls as the result of decreased smoke build.up; and•an estimated decrease in their fire insurance. 2"Target Survey, DartnelL's Business, June 1980, pp.37-40. 30Bennet and Levy, op.cit. - 31Ibid. TIMN 0086526 -141-

Merle Normal did not attempt to calculate the cost savings associated with health benefits or productivity. Absenteeism decreased during the first year of the ban. To ease the imposition of the ban, the company returned the expected savings during the first year of the program by giving each employee a $40 bonus. No complaints were received about the ban. In fact, several smokers wrote to the president thanking him for giving them the extra incentive they needed to kick the habit. Non52of the employees left the company because of the limitations on smoking. 2. Dangers of smoking to the health of the workforce. Though the dates of implementation of smoking policies (64% after 1964) suggest a relationship between the Surgeon General's Report on the health hazards of smoking and policy implementation, this is not substantiated by the Bennett and Levy survey or by interviews conducted by the author with representatives from major corporations. Employers seem to beZieve it is the employees' right to expose themselves to the risks linked to the smoking habit. 3. Smoking is an environmental hazard. The discovery that employees who work with certain substances have a much higher risk of an early death than their nonsmoking co-workers caught the attention of companies whose pro- ducts or production process included these substances. Increasingly, the argument is being made that any degradation of air quality poses a health hazard to all employees. Asbestos workers who smoke, for example, have a 92 times gJreater risk of developing lung cancer than nonsmokers with the same job. Johns Man- ville Co., the world's largest producer of asbestos, has been the most aggressive company to take action to reduce the number of smokers who work with asbestos. In the mid 70's, Johns Manville began implementing a five point approach to eliminate smoking in their plants. The plan provided: 1. Health information 2. Meetings between local management and union representatives 3. Presentations to the employees on the rationale for not smoking 4. Encouragement for workers to attend partially subsidized smoking cessation classes provided by SmokEnders 5. Institution of a smoking ban The company also decided to hire only nonsmokers.34 The company implemen- ted the program on the premise that there is sufficient epidemiological data to verify the adverse health effects that can result from the syner- gism between smoking and exposure to hazardous substances to warrant poli- cies that eliminate the interactions. 32lnformation obtained by the author from the public relations department of Merle Normal Cosmetics Co. 33The Smoking Digest, op.cit. TIMN 0086527 34Danaher, op.cit., from Johns Manville, Inc. (Health, Safety and Environment Department): Nonsmoking program; policies, program, history, implementation, education material. Denver, CO., 1978. -142- ~ ~~~~58

The company has stressed that smoking control is not a substitute for all other workplace environment changes; rather, it is an additional method of occupational environmental control. Paul Kotin, MD., Johns Manville's Senior Vice President for Health, Safety and Environment, believes the adverse effects of smoking must be addressed to completely comply with the Occupational Safety and Health Act of 1970 that states in Section 5(a): "Each employer shall furnish to each of his employees employment and a place of employment which are free from recognized hazards that,are causing or 15e likely to cause death or serious physical harm to his employees." Local unions opposed the implementation of the smoking ban and policy to hire only nonsmokers. They did not dispute the evidence that smoking was hazardous in the work environment. They did, however, oppose the company's right to implement this ban and policy without going through the collec- tive bargaining process. The unions also opposed the bans because they were afraid the company would use the aggiessive smoking campaign to dodge compliance of the safety standards. They were concerned that this ban against a personal behavior would set a precedent allowing employers to ban other personal habits or set other health behavior related criteria for employee selection. Unions were also concerned about employees who have woNd at the company for many years who might not be able to stop smoking. Four grievances against the policy were filed in different states. Three of the four were decided in favor of Johns Manville and the bans are now in effect. The fourth was decided in favor of the union. In that case, the judge decided the company must go through the collective bargaining process to implement the ban. However, it was decided that the company can unilaterally implement smoking restrictions. This decision was upheld in an appeal to the Federal Court. Therefore, in the Texas plant of Johns Manville where the court derJPion occurred, a smoking restriction rather than a ban is now in place. 4. Secondary or passive smoking and nonsmokers rights. The recent studies on the health effects of involuntary smoking or breathing air contaminated with exhaled smoke have put increased pressure on employers to establish smoking restrictions or bans. Though the exact physical effect of invol- untary inhalation of tobacco smoke is being debated, two studies have sug- gested the health hazards are increased. 35Kotin, Pual, M.D., Lois Anne Gual, "Smoking in the Workplace: A Hazard Ignorded", American Journal of Public Health, June 1, 1980, Vol. 70, No. 6. 36lnformation obtained in a conversation with Dr. Paul Kotin, Sr. Vice Presi- dent for Health, Safety and Environment, Johns Manville Corporation, Denver, CO., July 1981. 37lbid. TIMN 0086528 ~, ~c- 59 -143- ' ~ i ~

a) A study correlated the deaths of 91,000 nonsmoking Japanese women with the smoking habits of their husbands. An increased chance of dying of lung cancer was repo5ged to be directly proportional to the amount of smoking in the home. b) Another study measured the long term effects of voluntary and involun- tary smoking on 2,100 middle aged people. It was determined that the nonsmokers and light smokers who did not inhale scored similarly on a spirometric test, a measurement of lung capacity. The above groups, that worked with heavy smokers, scored significantly worse than non- smokers working in smoke free environments. The conclusion drawn from the study was that chronic exposure to tobacco smoke in the work e34i- ronment significantly reduces small airways function in the lungs. Along with the potential increased risk of lung cancer and reduced lung capacity, many indiv48uals find cigarette smoking to.be an irritation to their eyes and skin. Problems associated with the health hazards and annoyance of exposure to smoky environments for employers are: .I11 employees are more expensive employees due to increased medical expenses, decreased productivity and increased absenteeism. .The effects on morale have been mentioned by many corporate represen- tatives. The resentment and friction between smokers and nonsmokers has been a problem. Nonsmoking employees have become more vocal, through comments in company newspapers, about their right to a smoke- free environment. 307. of the managers who responded to the Dartnell Survey r4?orted employees had raised the smoking issue at one time or another. .Law suits attempting to establish the rights of nonsmokers to a smoke- free work environment have been on the rise. In December 1976, the New Jersey State Superior Court decision in the Shimp vs. New Jersey Bell Telephone Company case established a precedent on nonsmokers' rights. In this instance, Donna Shimp developed a severe allergy to tobacco smoke and brought a suit against her employer, New Jersey Bell Tele- phone Company, to have smoking banned in her office. The company had already placed smoking restrictions in areas housing sensitive tele- phone equipment that could be damaged by cigarette smoke. The court ruled that the company must provide "safe working conditions" by re- stricting employee smoking to the lunch room and lounge on the reason- ing that "Human beings are also very sensitive and can be damaged by cigarette smoke. Unlike a piece of machinery, the damage to a human is 38Newsweek, Jan. 26, 1981. 39White, James R., Ph.D., Herman F. Froeb, M.D., "Small Airway Dysfunction in Nonsmokers Chronically Exposed to Tobacco Smoke", The New England Journal of Medicine, No. 13, Vol. 302, p. 720, March 27, 1980. 40Stewart, Susan, The Washington Post, June 27, Thirty-four million Americans are reported to be allergic or sensitive to cigarette smoke. 41„Target Survey", op.cit. TIlVIN 0086529 -144- 1'O3. ~r~60

all too often irreparable. A company which has demonstrated such con- cern for its mechanical components should have at least as much concern for its human beings. Plaintiff asks nothing mo42 than to be able to breathe the air in its clear and natural state." RECOMMENDATIONS The conference is designed to cause a reduction in smoking in the U.S. The various Work Groups represent sectors of society that are "targets of oppor- tunity." Each is to contribute to the whole by developing action plans that will help reduce barriers now impeding the.overall goal of a more smoke-free --and thus more healthy--environment. Following are a series of recommendations offered to stimulate Work Group dis- cussions. As written, they represent a range of concepts and approaches rather than a unified strategy. The recommendations are organized around the barriers identified earlier, although many are equally applicable to more than one. Finally, other recommendations are organized around more general topics such as dissemination and legislation. Barrier: Cost 1. Prepare a statement, publicly•endorsed by the participating organizations. and individuals, that contains proof of the cost savings companies can re- ceive from smoking policies-and programs. These should emphasize the point that current programs cost between $5-$400 while the savings per em- ployee per year range from $624-$4,611, based on the studies in the paper. 2. Develop a model cost-benefit equation that will assist companies in mea- suring their own success/failure. 3. Establish the basic elements of cost upon which all can agree. ' 4. From all the cost and economic information, select the points that will most effectively humanize the issue for individuals (a companion document to #1 above.) Barrier: Ignorance 1. Prepare a brief, hard-fact statement, endorsed by all, that supports smo- king policies and programs. The endorsement and the clarity of the state- ment are what should set this statement apart from those that already exist. a. With an appropriate coordinating mechanism, establish a high-visibility media campaign for the dissemination of the statement. This should be accompanied by supportive campaigns through existing channels such as the American Occupational Medical Association, U.S. Chamber, the Busi- ness Roundtable Task Force on Health, WBGH, unions, etc. Further, there should be a direct contact campaign where the CEO's of companies with programs agree to contact others who do not. This contact can range from direct exhortation to a single notification about the new joint statement and its importance. 42 The Smoking Digest, op.cit. From Shimp vs. N.J. Bell Telephone Co. Super- ior Court of NJ, Chancery Division, Salem County. Opinion of J.S.J. Cruccio, Docket No. C-2904-75, decided Dec. 20, 1975. -145- TIMN TIMN 0086530

NOTE: It will not be easy to get industry organizations to endorse any meaningful statement due to their fear of retaliation from the tobacco industry. 2. Develop a"model" corporate policy that encompasses: -optional policy statements -assistance for smoking cessation -option for incentives -typical community resources -communication systems that have worked elsewhere -vending medicine policy -smoke breaks -restricted areas 3. Select the key data that every corporate manager should know and which will favorably influence the decision to adopt smoking policies or pro- grams. For example, the ratio of absenteeism that stimulated the Dow program. In some cases, national averages or other corporate examples should be adequate. However, for other kinds of data it will be necessary to do the analysis on a company or even location-specific basis. For these cases, the provision of "how to" instructions will help overcome the ignorance barrier. Barrier: Resources 1. Through the Int.eragency Council or some other source, develop a directory of organizations that provide..smoking cessation programs. The components of the directory should include: a. program description, b. cost c. success rates with specific references d. duration e. space or other requirements f. ability to train in-house so the company can do its own programs g. names and credentials of key personnel h. geographic coverage i. affiliations j. tax status An employer-union committee should design the directory. The Interagency Council or perhaps HHS or AOMA should verify the information. Proprietary firms should be included. 2. Establish a program selection guideline chart to assist employers and un- ions who are in resource-rich areas. Barrier: Labor-Management Relations Establish a national level joint task force on smoking control. This group' would be responsible for: -146- TIMN 0086531 T33`%, ~6 2

1. Issuing a broad statement urging all employers, with union participation, to establish smoking policies and to provide smoking programs. The state- ment would include the rationale for smoking reduction,but would not dic- tate the specific policies to be articulated at the local level. 2. Develop an employment strategy for tobacco-related jobs that, hopefully, will become obsolete. The argument is often made that we cannot afford to really ban smoking due to employment. This is not so since the industry is a far greater drain on the economy than it is a contributor. However, we do need to have a realistic and compassionate plan for workers and small farmers who may be displaced. Barrier: Effectiveness The recommendations on the cost and ignorance barriers are also applicable to the effectiveness barrier. In addition, a guide needs to be created that ac- curately and objectively assesses the quality of existing programs and estab- lishes minimum performance standards, for specific populations, against which future programs can be measured. Further, the effectiveness of alternative policies need more work than do spe- cific programs on which a rather large body of data already exists. Any work on effectiveness must be sufficiently flexible to incorporate the many varied motives, measures and audiences that are involved. Barrier: Liability 1. A joint labor-management task force should work with OSHA to establish a consensus definition of worker safety that protects employers and unions that establish health-based restrictions. 2. Terms such as "smoke free" may not in fact be an adequate description of the air quality that is necessary for good health. Also, this may change over time as new technology produces improved "smoke-eaters" and air cir- culation systems. Currently there is no way to have such considerations help ameliorate the litigious atmosphere surrounding smoker vs. nonsmoker rights. 3. Work should be started with the American Arbitration Association to devel- op model arbitration and mediation systems for workers vs. worker and worker vs. management smoking disputes. General Recommendations 1. Develop a dissemination plan for the conference statement(s), recommenda- tions, and products. This should be of multiple-year duration, national in scope, and comprehensive in its attempt to reach the desired audience from different,but supportive sources (media, schools, church, medical, employment, etc.) The dissemination plan for corporations should not rely on CEO's only. Also to be included are: TIMN 0086532 -147-

-personnel (human resources) vice presidents -finance/treasurer -communications/PR/public affairs staff -medical, benefits and safety Finally, any dissemination plan must include dependents, including chil- dren, starting no later than age 6. A second phase of the plan may be to go beyond the conference materials to become the network for new smoking control information dissemination, regardless of the source of that in- formation. 2. Legislation and regulation are dealt with in more detail by other con- ference Work Groups. However, there are many aspects of legislation and regulation that directly affect employers and their ability/incentive to provide smoking policies and/or programs. It is recommended that the con- ference organize an employer-union committee charged with: a. A review of current federal laws and regulations that actually impede smoking policies and programs. b. Development of proposed tax and other legislative/regulatory changes to create incentives for both workers and employers to invest in smoking reduction. c. Working with the insurance industry for changes in state insurance laws to encourage more premium-related health incentives; and to make the provision of smoking cessation programs a basic component of employee health insurance. d. Preparing a lobby strategy to counteract the tobacco industry's ef- forts. They have had an easy time because their opposition was so un- organized and underfinanced. If the rest of management and labor would lead the counterattack--as it clearly would on any new product that was known to have the health and economic consequences of tobacco--then the tobacco industry would have its effectiveness considerably reduced. This task is a significant component of the overall public information system which addresses the principal barrier of ignorance. 3. Influencing those who influence employees is a legitimate extension of the worksite program. For example, a considerable employer investment can be damaged if not totally coutermanded by family physicians who are smokers; by hospitals that refuse to have no-smoking policies; and by schools that do not teach health education. The real test of the degree to which ma- nagement and labor are truly committed to health will be the degree to which they work together for improved health of the total community. TIMN 0086533 . '~ ~3`%664 -148-