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SUNDAY, Jan. 11 (HealthDayNews) -- Forty years to the day that a landmark Surgeon General's report found the health hazards of smoking warranted "appropriate remedial action," a new study says there is still a long way to go.

A series of public health measures large and small have been taken since the 1964 report declared that cigarette smoking causes cancer and other diseases. Perhaps the single largest came in 1998, when the Master Settlement Agreement (MSA) required four U.S. major U.S. tobacco companies to give $209 billion to 46 states in return for dropping lawsuits.

The original lawsuit, brought by state attorney generals, aimed to get funds for Medicaid to recover the cost of treating tobacco-related illness. The settlement, however, allowed the states to use the windfall primarily at their own discretion.

And while many states said that they planned to use the funds to defray Medicaid costs, few have actually done so, according to new research being released Sunday from the Jan. 15 issue of the New England Journal of Medicine.

The journal chose this date because of Jan. 11, 1964, when Surgeon General Dr. Luther Terry released his historic report linking smoking to health hazards. That report help jump-start the antismoking movement in this country.

For the most part, the researchers say, states have not used the funds to cover Medicaid costs or for tobacco control and education projects. Instead, they have been used to address budget deficits and ensure "no new taxes."

"We missed a big opportunity, and we certainly could have done a lot more and we didn't do it. That's a shame," says Dr. Steven A. Schroeder, author of the new study and a professor of health and health care at the University of California, San Francisco. "State politicians chose not to use [master settlement funds] for the intended purposes."

"[The tobacco industry] got out of it easy," adds Dr. Robert Giusti, chief of pediatric pulmonology and assistant chair of pediatrics at Long Island College Hospital in Brooklyn, N.Y. "It became apparent quite a while ago that this was not going to have an impact on changing smoking habits. It has been a frustration."

According to the New England Journal article, in fiscal year 2003, 47 percent of the MSA payments were funneled into state budgets, up from 29 percent the year before and from 16 percent in the three preceding fiscal years.

Perhaps most troubling, many states are mortgaging future MSA payments through bond issues. This gives states a direct and strong interest in keeping the tobacco companies afloat so they will continue to pay.

In addition, certain stipulations in the original settlement, such as stronger warnings on tobacco packages, have been abandoned.

Most of the funding for the American Legacy Foundation disappears after five years because the money depends on the tobacco companies' maintaining a 99.05 percent or greater share of the U.S. cigarette market.

The new findings coincide with the Jan. 6 release of the American Lung Association State of Tobacco Control: 2003, which concludes that most states are not doing what it takes to protect citizens from tobacco smoke. The report card gave an "F" to 38 states and the District of Columbia for funding tobacco prevention and control programs and an "F" to 35 states and D.C. for smoke-free air laws. Three states flunked in tobacco taxes while 23 states failed in laws limiting youth access to tobacco.

There have been some forward movement, however.

The article quotes Matt Myers, director of the Campaign for Tobacco-Free Kids, saying that MSA was responsible for "the most significant increase in spending on tobacco prevention and cessation in history. These funds have forever changed the debate about the appropriate level of funding for tobacco control."

The MSA-funded American Legacy Foundation, Schroeder writes, is "the most important national counter-marketing effort in 30 years."

And to pay for all this, tobacco companies had to raise the price of cigarettes, an action which in itself resulted in fewer smokers.

The innovation from here on, Schroeder says, "is going to have to be on the ground and a little bit at a time, and it's too bad."

Still, there are hopeful signs. The telephone "quit lines," for instance, have been "fantastic," Schroeder says. They just haven't been marketed very well. Fuel for the anti-tobacco movement is also coming from raising cigarette taxes, counter-marketing (such as the American Legacy Foundation), and the clean indoor air movement.

Meanwhile, Guisti, adds, getting people to quit smoking is still the primary responsibility of physicians.

"I think there are reasons for optimism," Schroeder says. "Smoking rates are going down and smoking is becoming less socially acceptable. Those are two wonderful trends, [but] the problem is a lot of people think the battle is over -- but it's not."

His argument is bolstered by another new body of research, released in Saturday's British Medical Journal, that found low-tar cigarettes are no less damaging to health than any other form of filtered cigarettes.

The American Cancer Society estimates that before the 1964 Surgeon General's report, about half of all American adults smoked; today, the organization says, it's down to about 22 percent.

Smoking kills 440,000 American men and women each year, which is almost one person a minute, the ACS says. And cigarette smoking causes approximately 30 percent of all cancer deaths in the country, it adds.

More information

View state-by-state rankings in the American Lung Association report. To learn more about one of the outcomes of the MSA, visit the American Legacy Foundation.

(SOURCES: Steven A. Schroeder, M.D., professor of health and health care, department of medicine, University of California, San Francisco; Robert Giusti, M.D., chief of pediatric pulmonology and assistant chair of pediatrics, Long Island College Hospital, Brooklyn, N.Y.; Jan. 15, 2003 New England Journal of Medicine)

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