17.4 Economic evaluations of tobacco control interventions

Tobacco control interventions are an excellent investment. A review of economic evaluations of tobacco control programs published in 2009 concluded: ‘the existing studies show in almost every case that tobacco control programs and policies are either cost-saving or highly cost-effective’.¹ A 2010 Australian report that examined the cost-effectiveness of 150 disease prevention interventions predicted that a tobacco taxation increase (of 30%) would not only be cost-saving, but was the intervention that would have the highest health benefit—270,000 years of healthy life lost (disability-adjusted life years, or DALYs) prevented.²

17.4.1 The cost-effectiveness of comprehensive tobacco control programs

The cost-effectiveness of tobacco control has been studied in at least three types of analyses:

• economic evaluations of comprehensive programs that have involved a mix of interventions
• studies that compare different communities in terms of their historical tobacco control expenditures or policy implementation and the resulting outcomes (smoking rates, health outcomes or economic outcomes). These studies are a type of epidemiological study referred to as ‘ecological analyses’, because the unit of analysis is a population rather than an individual studies of the impact of projected reductions in smoking prevalence on specific health or economic outcomes
• studies of the impact of projected reductions in smoking prevalence on specific health or economic outcomes. 

17.4.1.1 Evaluations of comprehensive tobacco control programs

Robust evidence supports the effectiveness of comprehensive tobacco control programs in reducing smoking prevalence.³ One of the largest comprehensive tobacco control programs in the world is the California Tobacco Control Program (CTCP).⁴ It began in 1989, with an annual budget of about $100 million. In addition to the tobacco tax increase that financed the program, the CTCP involved an anti-tobacco media campaign, community- and school-based interventions,⁵ and comprehensive smokefree legislation. Changing social norms about smoking has also been shown to have contributed to the dramatic decline of smoking in California.⁶ An economic evaluation investigated the impact of tobacco control on Californian men alive in 1990 over their subsequent life until 2079, when the youngest would turn 90. The value of the net health care savings and years of life saved was about $22 million (in 1990 dollars, discount rate of 3% per annum),⁷ indicating the CTCP was cost saving as well as effective. Two studies examining the effects of the program on smoking and healthcare expenditures—one looking at 1989–2008⁸ and an updated paper looking at 1989–2019⁹—both concluded that it led to substantial healthcare savings. The updated model estimated that the total cost of the program over the 20-year period was $3.5 billion, with a return on investment of $231 for every $1 of program expenditure. It did however note that the impact of the program slowed after 2008 due to lower funding compared with earlier years.⁹  

The New York State Department of Health’s Tobacco Control Program first implemented in the early 2000s comprised increases in cigarette taxes, comprehensive smokefree laws, mass media campaigns, promotion of the Quitline, and provision of nicotine replacement therapy via the Quitline. A recent study concluded that the program has a relatively large return on investment based on estimations of savings in healthcare and mortality costs.¹⁰ Studies examining state-level tobacco control programs in Washington State,¹¹ Massachusetts,¹² Florida,¹³ Minnesota,^14,15 and Arizona¹⁶ similarly all demonstrated that investments in tobacco control programs are associated with significant reductions in smoking and mortality and healthcare costs. State-level programs also appear to be supported by federal tobacco control strategies, which help to support smoking reductions in states with lower levels of expenditure.¹⁷ An analysis of the return on investment of tobacco control strategies implemented in Canada from 2001–2016 concluded that the costs were far outweighed by the economic benefits of reductions in smoking, yielding a return of approximately $20 for every dollar invested.¹⁸ Studies in other countries have similarly demonstrated the excellent return on investments of comprehensive tobacco control programs,¹⁹ including in low- and middle-income countries.²⁰

The consulting group Applied Economics evaluated the return on investment in Australian public health programs.²¹ They found that from the late 1960s to late 1990s male smoking rates dropped from 45 to 27% and female rates dropped from 30 to 23%. By 1996, tobacco expenditure per capita had dropped to less than 40% of its 1965 level. Applied Economics estimated that Australian public health programs aimed at reducing tobacco consumption had cost $176 million over that 30-year period. Based on estimated reductions in disease and about half a million premature deaths up to the year 2000, the study estimated that tobacco control interventions had saved the Australian economy $8.06 billion (2000 dollars, discounted back to 1971). The analysis found that the government saved $2 for every $1 it spent on public health programs to reduce smoking.

17.4.1.2 Ecological analyses of tobacco control

The 1998 Master Settlement Agreement with the tobacco industry in the US made funding available to states for tobacco control programs. Implementation of such programs has varied between states.²² It is therefore feasible to investigate the correlation, at state level, between tobacco control expenditure and health and health economic outcomes. Such analyses have found that in states that increased tobacco control program funding there were decreases in aggregate cigarette sales,²² lower prevalence of youth smoking,²³ more rapid falls in cardiovascular death rates²⁴ and reduced personal health care expenditures.²⁵

17.4.1.3 Evaluations of the economic benefits of smoking prevalence reductions

Smoking causes substantial economic loss²⁶ (see Section 17.2). Several Australian analyses have modelled the impact of reducing smoking on specific health economic outcomes. The first analysis was published in 2004,²⁷ in the context of the federal government’s Intergenerational Report (IGR) which predicted large increases in the cost of government subsidies of medicines under the Pharmaceutical Benefits Scheme (PBS) consequential to an ageing population.²⁸ The economic analysis predicted that if smoking prevalence were reduced by 5%, savings in PBS subsidies for drugs to treat smoking-related cardiovascular disease would exceed a billion dollars over the 40-year period of the IGR. If the 5% reduction in smoking rate could be achieved at a cost of $45 million, the program would have an internal rate of return of 33% and the initial investment would be recouped in eight years.

Another analysis investigated the impact of reductions in the smoking rate on acute myocardial infarction (heart attack) hospitalisations and costs.²⁹ A model previously used to predict these outcomes for the US and the UK was updated and applied to the Australian population.^30,31 The analysis predicted that if smoking prevalence dropped by 5%, over 3,000 hospitalisations for myocardial infarction and 1,000 hospitalisations for stroke would be avoided over only a seven-year period. Health care costs would be reduced by $61.6 million, almost 3% of the total hospitalisation costs for stroke and heart attack over the period. Another Australian study estimated that in 2008, the potential opportunity cost savings to the health sector were $1,412 million if smoking was eliminated from the population. If the prevalence of smoking was reduced from 23% to 15% (the ideal target), the study estimated a potential opportunity cost savings of $491 million to the health sector.³²

Smoking increases the risk of the eye disease, age-related macular degeneration, by 2.5-fold to 4.5-fold. Australian research found that smoking cessation is unequivocally cost-effective in terms of its impact on age-related macular degeneration.³³ It predicted that if 1,000 people quit smoking, there would be 48 fewer cases of macular degeneration, 12 fewer cases of blindness and the costs of treating and caring for people with macular degeneration would decrease by $2.5 million. If the tobacco control program that facilitated quitting cost less than $1,400 per person who quit, it would be cost-saving in terms of its impact on macular degeneration alone. Research estimating reductions in NICU costs in Victoria if smoking prevalence among pregnant women was reduced from 8.4% to 6.4% estimated savings of 106 cot-days, or an annual cost saving of A$276,000.³⁴

UK researchers modelled the impacts of achieving a ’tobacco-free’ ambition where, by 2035, less than 5% of the population smoke tobacco across all socioeconomic groups. Due to improved health outcomes, the scenario was predicted to avoid £67 million in direct NHS and social care costs in the year 2035 alone, with most of the savings from fewer cancer cases (£32 million), followed by other diseases.³⁵ Another report that modelled the economic impact of a ‘smokefree UK’ (i.e. smoking prevalence of 0%) estimated that it would increase economic output by just under £10 billion per year, and increase employment by just over 135,000 full-time equivalent jobs.³⁶ Another study similarly estimated that the 'smoke-free dividend' (the value added to local economies if everyone quit smoking) would be £10.9 billion each year for England, with relatively greater dividends in areas with lower compared with higher average incomes.³⁷ Modelling of the (subsequently repealed) Smokefree Aotearoa/New Zealand 2025 legislation, which aimed to reduce smoking to less than 5%, similarly concluded that it would lead to substantial economic benefits for the population.³⁸ One commentary also highlights that if governments are purportedly aiming to improve the health of populations, then any reliance on tobacco tax revenue undermines this aim.³⁹

US researchers predicted that a 10% relative drop in smoking in every state would be followed by an expected $63 billion reduction (in 2012 US dollars) in healthcare expenditure the next year.⁴⁰ A study looking at Minnesota estimated that reducing cigarette smoking from 1998 to 2017 has prevented 4,560 cancers, 31,691 hospitalisations for cardiovascular disease and diabetes, 12,881 respiratory disease hospitalisations and 4,118 smoking-attributable deaths. Minnesotans spent an estimated $2.7 billion less in medical care and gained $2.4 billion in paid and unpaid productivity (adjusted to 2017US$).¹⁵ Another study of Minnesota that modelled the future effects of tobacco control highlighted the increasing trajectory of health and economic benefits as the benefits to adults who quit smoking increase over time and the decades of benefits to young people accrue who are diverted from smoking uptake.⁴¹ Also in the US, researchers estimated the impact of a pregnant woman stopping smoking before the end of the first trimester on pregnancy- and birth-related outcomes.⁴² They predicted that a 1% national drop in smoking prevalence would prevent 1,300 low birth weight live births and save $21 million in one year alone (1995 US dollars). Another study found that increases in cigarette taxes are particularly effective for reducing smoking and improving birth outcomes among the highest-risk women.⁴³ Other international studies have similarly demonstrated the benefits of reductions in tobacco use for the health of populations and the economy.^44,45

In their reports to state governments in Victoria, Western Australia and New South Wales, Collins and Lapsley have not just quantified the social costs of smoking but have also estimated the social returns that could be expected from future reductions in smoking prevalence.^46-48 More recently, consulting firm Creating Preferred Futures estimated the economic benefits of a reduction in the 2015-16 prevalence of smoking in Victoria. Achieving a target of 10 per cent prevalence by 2025 would result in a decline in tangible costs of 14.5 per cent, from $3,696.1 million in 2016 to $3,161.4 million in 2025. Intangible costs associated with loss of life from smoking would decline from $5,777.9 million in 2016 to a low of $4,914.5 million in 2034 – a decline of 14.9 per cent. Reducing smoking prevalence to five per cent would lead to a reduction in tangible costs of 55.6 per cent, from $3,696.1 million in 2016 to $1,639.7 million in 2025. Intangible costs associated with loss of life from smoking would decline from $5,777.9 million in 2016 to a low of $2,457.1 million in 2034 – a decline of 57.5 per cent.⁴⁹

17.4.2 Economic evaluations of population-based interventions

Policy measures that succeed in increasing the price of tobacco products are undoubtedly the most effective strategy for reducing tobacco use and its associated costs. Non-price-based measures (such as smoking restrictions in workplaces and public places, bans on tobacco advertising, and raising the minimum purchase age for tobacco products)—through benefits such as a reduction in smoking prevalence, reduction in second hand smoke, savings from smoking-related medical expenditures, heart diseases averted, costs averted by a reduction in smoking-induced fires, and gains in productivity—have also proven to be both effective and cost saving. A major review found that the cost–effectiveness ratio of implementing non-price-based smoking cessation legisla­tions range from US$2 to US$112 per life year gained, while reducing smoking prevalence by up to 30%–82% in the long term (over a 50-year period).⁵⁰

17.4.2.1 Cigarette taxation and price increases

Tobacco tax increases that increase the price of tobacco products have been the single most effective and cost-effective policy to reduce tobacco use and to prevent initiation among young people.^51,52 An Australian report in 2010 concluded that a 30% tobacco tax would be one of the most cost-effective preventive interventions with the largest population health impact.² In Brazil, researchers estimated that a 50% increase in cigarette prices would avoid 136,482 deaths, 507,451 cases of cardiovascular diseases, 64,382 cases of cancer, and 100,365 cases of stroke, and the estimated economic benefit would be BRL 97.9 billion (USD 25.5 billion).⁵³ Researchers in China estimated that a 75% increase in cigarette prices would avert about 24 million premature deaths among the current Chinese male population, increase additional tax revenues by US$46 billion annually, and prevent around 9 million cases of poverty.⁵⁴

A review of modelling studies concluded that interventions that increase the unit price of tobacco products generate substantial healthcare cost savings over the short to medium term and can generate additional gains from improved workplace productivity. Estimates of healthcare cost savings from a 20% price increase ranged from –$0.13 to $86.72 per person per year. After including other benefits such as productivity gains, the total estimated net savings ranged from –$0.13 to $90.98.⁵⁵ Another major review found that price-based policy measures such as increase in tobacco taxes are the most effective means of reducing tobacco use and in turn the health care costs associated with treating smoking-caused diseases. In countries where the impact of tax increases have been studied, a 10% tax-induced cigarette price increase reduces smoking prevalence on average by between 4% and 8%.⁵⁰ Research on tax increases in low- and middle-income countries is limited, but existing studies support their cost-effectiveness in these settings.^56-63 A recent review also supports the efficient role of cigarette taxes in reducing tobacco use and associated costs, though notes a number of important considerations for future research on the optimal level of taxation including the impact of tax evasion, the growth of alternative products (e.g. e-cigarettes), and effects on low-income groups.⁶⁴ See InDepth 13A for further discussion of illicit trade in tobacco.

17.4.2.2 Smokefree laws and policies

Smokefree legislation primarily aims to protect people who don’t smoke from the harmful health effects of secondhand smoke. Legislative smoking bans lead to improved health outcomes in the community through reduction in exposure to secondhand smoke, with the clearest evidence for reduced heart attacks and other cardiovascular disease.^65-72 Such bans also provides an environment that is conducive to people’s efforts to quit smoking.⁶⁵ Smokefree legislation reduces consumption among people who smoke,^72-74 and may also encourage them to quit and to remain abstinent.⁷² See Section 15.9 for a detailed discussion.

Reductions in both the prevalence of exposure to second-hand smoke and the prevalence of smoking can be expected to lead to a reduction in smoking-related diseases and therefore in health care costs.⁷⁵ An early report issued by the US Environmental Pro­tection Agency analysing the costs and benefits of a proposed national smokefree environment act (requiring that all non-residential buildings regularly entered by 10+ persons in the course of a week prohibit smoking inside the building or restrict it to smoking rooms) estimated the net value to society as between US$39 and US$72 billion.⁷⁶ Another US study published in 2004 estimated that the total cumulative averted costs over seven years of a national smokefree workplace policy would be nearly $280 million, including $224 million from prevented myocardial infarctions and $55 million from prevented strokes.⁷⁷

17.4.2.3 Retail promotion and access

Cigarette advertising conveys information about the product’s physical characteristics and  ‘personality’. Such advertising is designed primarily to create:

‘fantasies of sophistication, pleasure, social successes, independence or ruggedness. This process can induce individuals who are not smokers to try the product, for those are smokers, to smoke more, for those might have quit, to continue and for those who have quit, to start again.’ (Saffer and Chaloupka,⁷⁸ Section 2, para 2).

An econometric study prepared for the World Bank compared changes in tobacco consumption in countries that had introduced advertising bans.⁷⁹ Controlling for price, income and other factors affecting demand, they found that limited bans are minimally effective. Comprehensive bans, however, do reduce tobacco use. A study that modelled the benefits of tobacco advertising bans in Latin America concluded that while current bans that vary in extent and compliance are producing meaningful health and financial benefits, adoption of comprehensive bans would substantially enhance such benefits.⁸⁰

Greater density of tobacco retailers has been suggested as an important factor in the uptake of smoking, and tobacco control advocates have called for limitations to be placed on the number of tobacco retail outlets (see Section 11.9). New Zealand researchers modelled the future health gains and health system cost-savings of tobacco outlet reductions. They found that restricting tobacco sales to only 50% of the country’s liquor stores and no other outlets was the most effective of four interventions, leading to the highest health gains and also to large cost-savings (NZ$1.03 billion). Nonetheless, all four interventions—restricting sales to liquor stores, as well as reducing the total number of outlets by 95%, or eliminating sales from outlets within 1 km or 2km of schools—were cost-saving for the health system.⁸¹ Another New Zealand study estimated that proposed ‘endgame’ strategies, including reducing the amount of tobacco imported into the country until commercial supply would end in 2025, introducing a tobacco free generation, or substantially reducing tobacco outlets, would all result in large health gains and cost savings to the health system, especially so for Māori.⁸² The subsequently repealed Smokefree Aotearoa/New Zealand 2025 legislation included a reduction in the number of tobacco retail outlets by at least 90%, banned sales to people born after 2008, and denicotinised tobacco products. Modelling suggested that the legislation would produce substantial economic benefits for the population, as well as health and health equity benefits.³⁸

17.4.2.4 Health warnings

In Australia, Applied Economics completed a cost-benefit analysis of new health warnings on cigarette packs prior to their introduction in 2004.⁸³ The new warnings comprised 14 rotating graphic messages covering 50% of the front and back of the cigarette packs. Assuming that the new warnings would result in a 3% decrease in smoking rates, the analysts forecast a net benefit of over $2 billion and a benefit:cost ratio greater than 2:1. In the US, researchers attempted to quantify the national hospital cost savings from the reductions in prenatal smoking that would result from the implementation of graphic warning labels on tobacco packaging. The study concluded that such warnings could lead to hospital cost savings of 1.2 to 2.0 billion dollars over 30 years.⁸⁴

17.4.2.5 Policies targeting adolescents

In all Australian states and territories, the minimum legal age for purchase of cigarettes is 18 and the distribution of free samples is prohibited.⁸⁵ The vigour with which such laws are enforced has varied in different jurisdictions over time in Australia.⁸⁶ Studies suggest that strengthening of laws banning sales to minors in Australia may have contributed to the dramatic declines in youth smoking^87,88 (see Section 5.21).

A cost-effectiveness analysis of programs enforcing the prohibition of tobacco sales to minors has been conducted for the US.⁸⁹ Reliable data on the effectiveness of such programs was unavailable,⁹⁰ but the analysts estimated that if enforcement decreases the prevalence of youth smoking by 5%, the cost per life-year saved would range from $440 to $3,100. Enforcement programs are therefore cost-effective, even if their impact on smoking rates is relatively small.

A systematic review published in 2018 found that evidence on the cost-effectiveness of tobacco control policies and programs targeting adolescents, including smoking bans, bans on sales to minors, bans on advertising at points-of-sale, school programs, and media campaigns, is scarce. Nonetheless, all of the included studies concluded that the policies and programs were always cost-effective and, in some cases, ‘dominant’ (that is, cost saving), particularly in studies where the healthcare costs averted were taken into account.⁹¹ Another evidence review concluded that school-based smoking prevalence programs could lead to savings of between US$2,000 and US$20,000 per QALY saved due to averted smoking after 2-4 years of follow-up. Such programs tend to reduce short-term smoking prevalence by between 30% and 70%.⁵⁰ An economic evaluation of five tobacco control policies (bans on sales to minors, bans on smoking in public places, bans on advertising at points-of-sale, school smokefree bans, and school education programs) implemented in 2016 across seven European countries found that all five policies were highly cost effective, even when considering the highest intervention costs and most conservative effectiveness estimates.⁹²

17.4.2.6 Mass media campaigns

Mass media campaigns have consistently been shown to be effective in reducing smoking prevalence and prompting quitting behaviours—see Section 14.4. Mass media campaigns can also be cost-effective. A study of Scotland’s 1992 campaign and an analysis of a four-year media campaign in the US that targeted adolescents both reported costs per life-year saved below $1,000 (2005 US dollars).^1,93,94

An evaluation of the Australian National Tobacco Campaign (NTC) was initiated by the federal government in 1997.⁹⁵ The NTC involved intensive television broadcasting of new anti-smoking advertisements and increased funding for support services for people attempting to quit smoking. The cost-effectiveness analysis found that the NTC was both cost saving and effective. The campaign cost about $9 million, but predicted health care cost savings exceeded $740 million. About 55,000 deaths were predicted to be prevented and over 400,000 QALYS saved.

The Cancer Council Victoria submitted a report in 2009 to the National Preventative Health Taskforce analysing the potential impact of more intensive tobacco control strategies than the anti-smoking social marketing campaign funded under the National Partnership Agreement on Preventative Health (NPAPH) and scheduled to start that year.⁹⁶ The report predicted that tobacco taxation increases, combined with additional spending on anti-smoking media, would achieve the Taskforce’s goal of a smoking prevalence of 10% or less by 2020 and would avoid 248,200 premature deaths. Such a program was estimated to cost about $276 million, but would save over $5 billion in health care costs.

An Australian study on the cost effectiveness of online, radio, and print tobacco control advertisements targeting 25–39-year-old males found that online advertising could be more cost effective than other non-television advertising media such as radio and press in reaching and affecting target audiences.⁹⁷

In 2012, the US CDC launched the first federally funded national mass media antismoking campaign ‘Tips From Former Smokers’, which was found to be highly cost-effective.⁹⁸ One study estimated that during 2012–2018, the campaign was associated with $7.3 billion in healthcare sector cost savings.⁹⁹ Another concluded that the campaign would be cost saving in 10 years or less from multiple perspectives, including to individuals, Medicare, Medicaid, productivity gains, and improved health.¹⁰⁰ An analysis of the ‘Real Cost’ campaign in the US found that the overall return on investment of the campaign was $128 in cost savings for every $1 spent.¹⁰¹ An evaluation of the Truth Initiative’s FinishIt campaign, designed to prevent smoking initiation among young people, concluded that although public education campaigns require substantial investment, the potential positive impact to society is enormous. A relatively modest number of people taking up smoking need to be averted for such investments to be cost-saving or cost-effective.¹⁰² A calculation of the return on investment for the campaign estimated that for every $1 spent, $174 dollars were saved.¹⁰³

A systematic review published in 2015 concluded that, despite limited evidence, research consistently suggests that tobacco control mass media campaigns offer good value for money; overall, they are able to deliver targeted messages to large populations of people at a low cost per head.¹⁰⁴ Another review similarly found that although the included studies were diverse, all showed that mass media campaigns had positive effects on smoking behaviours, and the studies with economic outcomes showed cost effectiveness.¹⁰⁵ Advertising media, telecommunications, and other technology-based interventions (such as TV, radio, print, telephone, the Internet, PC, and other electronic media) usually have positive synergistic effects in reducing smoking prevalence, especially when combined to deliver smoking cessation messages and counselling support. Due to its universal reach and low implementation costs, online campaigns appear to be substantially more cost effective than other media, though may not be as effective in reducing smoking prevalence.⁵⁰

17.4.2.7 Quitlines

Telephone quitlines provide advice and behavioural support and operate in all Australian states and territories, and evidence shows that that proactive telephone counselling increases a person’s chance of quitting smoking¹⁰⁶ (see Section 7.14). An assessment of call-back counselling provided by the quitline in Queensland, Western Australia and the Northern Territory concluded that it both improves health and achieves net cost savings.¹⁰⁷ An economic analysis of the Victorian Quitline concluded that it is highly cost-effective, improving health and saving costs when added to usual smoking prevention activities. It estimated that provision of the Quitline service in 2015 cost $1M and will save the healthcare system approximately $1.2M, 22,202 life years, and 1,480 DALYs over the lifetime of Victorian adults who smoke.¹⁰⁸ A more recent analysis of the Victorian Quitline supported the earlier findings, concluding that the service is highly cost-effective. Along with healthcare savings and improvements in health, it highlighted substantial productivity improvements associated with the provision of the service.¹⁰⁹

International research has also supported the cost-effectiveness of quitlines. A US study concluded that offering telephone counselling to quitline callers is cost-effective.¹¹⁰ Callers were randomised to receive mailed self-help booklets or booklets plus telephone counselling. The quit rate 12 months was 4.5% higher in the counselled group and the cost for each additional year of maintained smoking cessation was $1,300 (US dollars, 2000). Another US study¹¹¹ as well as research in Spain¹¹² found that proactive telephone outreach was effective and cost-effective. A Swedish study assessed the 12-month quit rate for over 1,000 callers to the national quitline.¹¹³ Over 30% of callers quit and the cost per life-year saved was estimated at between $311 and $401 (US dollars, 2002). An evaluation of the quitline in Thailand also found it to be a cost-effective intervention,¹¹⁴ and New Zealand researchers estimated that an intervention package of a quitline service and its mass media promotion would generate substantial health gain and would be cost saving for the health system.¹¹⁵ Several studies have concluded that providing NRT through quitlines increases cost-effectiveness.^116-119

Internet and mobile phone-based interventions for smoking cessation can also be effective (see Section 7.14), and the high reach and low cost of such interventions could greatly increase the cost-effectiveness of smoking cessation services. Several studies have shown that internet-^120-123 and mobile phone-based^124,125 cessation interventions increase abstinence and are cost-effective.

17.4.3 Economic evaluations of clinical interventions

The main clinical tobacco control interventions are behavioural support to stop smoking and pharmacotherapies. Behavioural support can be brief (such as advice from a health professional) or more intensive, involving repeated counselling sessions. Both behavioural support and use of pharmacotherapies increase a person’s likelihood of successfully quitting, with optimal treatment comprising a combination of both—see Chapter 7. The use of pharmacotherapies such as varenicline, NRT, and bupropion, when combined with GP counselling or other behavioural treatment interventions (such as proactive telephone counselling and web-based delivery), is both clinically effective and cost effective to primary health care providers.⁵⁰ Because both pharmaco- and behavioural therapies for smoking cessation are cost-effective or even cost-saving, smoking cessation programs are regarded as the gold standard of cost-effectiveness in health care.¹²⁶

A major report by the World Health Organization outlines the substantial health and economic benefits of investing in cessation. Specifically, it recommends investing in 3 population-level approaches (brief advice in primary care, national free quit lines and mobile phone interventions) and 3 pharmacologic interventions (nicotine replacement therapy (NRT), Bupropion, and Varenicline), and makes the case that investing in these interventions could help millions of people quit smoking, save millions of lives, and offer a significant return on investment for governments. The report estimates that an additional US$1.68 invested in all 6 cessation interventions (per capita per year from 2021 to 2030) would result in 152 million people who smoke being helped to quit and 2.7 million lives being saved by the year 2030. By the time the cohort of people who quit reaches age 65, 16 million lives would be saved and each dollar invested would have yielded US$7.50 in gains.¹²⁷

17.4.3.1 Healthcare system interventions

Along with the use of pharmacological and behavioural treatments, research clearly demonstrates the effectiveness and cost-effectiveness of promotion of cessation by health care professionals, and integration of cessation treatments into healthcare systems.¹²⁸ Because brief advice to quit smoking is effective¹²⁹ and inexpensive, and because the health and economic benefits of quitting are large, smoking cessation advice has long been recognised as very cost-effective intervention. For example, a review found that five minute physician or nurse smoking cessation counselling had cost-effectiveness ratios less than $5000 per life-year saved.¹³⁰ Smoking cessation advice was more cost-effective than most of the other prevention strategies considered. Additional studies have similarly supported the cost-effectiveness of brief interventions for tobacco cessation.¹³¹ A study in the UK that modelled the improved delivery of brief cessation interventions by GPs concluded that it would result in economic savings between 2019 and 2039 of over £9.4 billion in costs to the UK health service and over £15 billion in costs to society through morbidity and mortality.¹³²

Reviews have concluded that smoking cessation advice and assistance to quit smoking is one of the most cost-effective disease prevention services available in clinical settings. In the US, an evaluation of clinical preventive services concluded that providing smoking cessation advice and help to quit was one of only three services that received the highest ranking for both health impact and economic value.¹³³ The other services were childhood immunisation and daily aspirin use for prevention of cardiovascular disease. Research from Ontario concluded that a best practice smoking cessation program for cancer patients (screening, advice, and referral plus pharmacological therapy) has the potential to be cost-effective option when compared to a basic smoking cessation program (screening, advice, and referral).¹³⁴ Additional studies have also supported the cost-effectiveness of cessation interventions in oncology^135-137 and cancer screening settings,^138-140 as well as preoperative smoking cessation interventions,^141-148 hospital inpatient tobacco dependence treatment,^149-152 interventions in the emergency department¹⁵³ and dental settings,¹⁵⁴ proactive tobacco treatment outreach strategies,^155,156 financial incentives during pregnancy and postpartum,^157-159 interventions delivered in paediatric settings to help parents quit smoking,¹⁶⁰ and funding smoking cessation programs for Crohn's disease¹⁶¹ and COPD.¹⁶² In the UK, the NHS-funded stop smoking service involves community pharmacists providing cessation advice and support, and has also been shown to be cost-effective.¹⁶³ One review concluded that community pharmacist-based smoking cessation programs yield cost savings to the health system of between US$500 and US$614 per life year gained.⁵⁰

17.4.3.2 Pharmacotherapies

Smoking cessation guidelines recommend that people who smoke be offered pharmacotherapy.¹⁶⁴ In Australia, three pharmacotherapies are available: nicotine replacement therapy (NRT), bupropion and varenicline—see Section 7.16. The Pharmaceutical Benefits Advisory Committee (PBAC) recommends to the Minister for Health which drugs should be subsidised under the Pharmaceutical Benefits Scheme. A medicine must be effective and cost-effective in order to be subsidised.^{165, 166} The three available smoking cessation pharmacotherapies have each been recommended for subsidy by the PBAC; they are all regarded as ‘cost-effective’.  The Australian project, Assessing Cost-effectiveness in Prevention (ACE–Prevention), found that the three smoking cessation pharmacotherapies were ‘very cost-effective preventive interventions’. All three medicines had cost-effectiveness ratios of $10,000 per DALY saved or less.² A major evidence review concluded that the cost per life year saved from the use of pharmacological treatment interventions ranged between US$128 and US$1,450 and up to US$4,400 per quality-adjusted life years (QALYs) saved.⁵⁰

International research has found that varenicline is cost-effective compared with other smoking cessation interventions such as bupropion and NRT^167-173 and particularly when compared with unaided cessation.¹⁷³ Three Australian studies considered prior to listing of NRT on Australia’s Pharmaceutical Benefits Scheme (PBS) analysed the relative cost-effectiveness of these smoking cessation pharmacotherapies.^174-176 Two studies at that time found bupropion more cost-effective than NRT,^174,176 and one study found varenicline more cost-effective than both NRT and bupropion.¹⁷⁵ The Pharmaceutical Benefits Advisory Committee regards nicotine patch as safer and cheaper than bupropion and views the two drugs as having comparable efficacy. The PBAC considers varenicline as superior in effectiveness to bupropion, NRT and placebo, and comparable in safety.^177,178 While varenicline is more effective than bupropion and NRT for smoking cessation,^179,180 all three are safe and effective and NRT is considerably cheaper, hence the decision to include it on Australia’s PBS. Findings regarding the cost-effectiveness of combinations of these pharmacotherapies (e.g. varenicline + NRT) are mixed, with some studies suggesting monotherapy is more cost effective¹⁸¹ and others showing higher returns for combination treatments.^182,183 Combination NRT (i.e. using both the slow-acting patch plus a fast-acting form) is more effective in supporting cessation than single-form NRT, and research has also supported the cost effectiveness of this approach.¹⁸³ However, despite calls from major professional bodies for its inclusion,¹⁸⁴ combination NRT is not currently subsidised on the PBS. The addition of behavioural support to pharmacotherapy may be more cost effective than the provision of pharmacotherapy alone.¹⁸⁵

Several US studies have concluded that expansion of coverage for smoking cessation prescriptions with no out-of-pocket costs could reduce healthcare expenditures, based on thousands of extra quitters and hundreds of thousands in healthcare savings.^12,186,187 Research in the Netherlands and the UK examined the cost-effectiveness of extending current cessation practices to include: increasing the reach of top‐level services to increase potential quitters (e.g. brief physician advice); increasing the reach of behavioural support to increase the success rates; (c) including a new but effective medication (cytisine); and (d) all changes implemented together (combined change). It found that the combined change would generate an incremental net benefit of €11.47 (2 years) to €56.16 (life‐time) per person who smokes in the Netherlands and €9.96 (2 years) to €60.72 (life‐time) per person who smokes in England.¹⁸⁸ Additional studies^112,189 also support the cost-effectiveness of reimbursing smoking cessation medications. For example, a recent modelling study in Sweden concluded that provision of 12 weeks of free NRT is a cost-saving strategy for society and could help to reduce health inequalities.¹⁹⁰ Japanese researchers predicted that an increased use of smoking cessation pharmacotherapy to support quit attempts would increase the number of people achieving abstinence from smoking and would be beneficial both due to a reduction in healthcare costs and increased productivity.¹⁹¹ A recent review of the effects of financing cessation medications (NRT, bupropion, cytisine and varenicline) concluded that this strategy is cost-effective, improves population health, and reduces the burden of tobacco use. It notes that financing pharmacological treatment increases motivation to quit, encourages use, and is particularly beneficial for groups with lower income or education.¹⁹²

17.4.3.3 Workplace interventions

Tobacco use substantially reduces employee productivity, including by increasing absenteeism (see Section 17.2.4). Workplace smoking interventions can include pharmacological interventions, behavioural interventions, or a combination of both, and generally include strategies such as smoking bans, incentives, competitions, individual and group counselling, self-help materials, pharmacotherapy, and social and environmental support. A review found that such interventions can be cost-effective, achieving a benefit-cost ratio of up to 8.75 and generating 12-month employer cost savings of between $150 and $540 per nonsmoking employee. Implementing smokefree workplaces can also promote quitting and reduce consumption, leading to lower healthcare costs. Workplace interventions will also likely yield greater long-term economic benefits, as reduced prevalence will lead to a healthier and more productive workforce.⁵⁰ Subsequent studies have similarly supported the cost-effectiveness of cessation interventions in the workplace setting for both healthcare savings and improved productivity.^193-196 A modelling study estimated the budget impact of funding pharmaco- and behavioural therapies for smoking cessation from an employer perspective and concluded that, considering the avoided costs of loss of productivity and absenteeism, funding such a program would produce substantial savings for the employer.¹⁹⁷

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