Cigarette smoking is well-documented as the most important cause of chronic bronchitis in the United States and as a risk factor for coronary heart disease (1,2). A 2009 report by the Institute of Medicine (IOM) concluded that secondhand smoke exposure increases the risk of coronary heart disease by 25% to 30%, and smoking bans that reduce exposure to indoor secondhand smoke are associated with a decreased incidence of acute myocardial infarction (AMI) (3). Actively smoking or being exposed to secondhand smoke can trigger an asthma attack and worsen asthma symptoms. Despite numerous health studies and scientific reports identifying the harmful effects of smoking and the benefit of smoking cessation, 18.4% of Pennsylvania adults smoked in 2010 (4), a prevalence substantially higher than the national Healthy People 2020 objective of 12.0% (5).

Numerous economic studies have documented that cigarette price increases, most often through cigarette excise taxes, are significantly associated with reductions in smoking prevalence and smoking initiation (2,6,7). One study documented that a 10% increase in cigarette price was associated with reductions of an estimated 3% to 5% in overall short-term cigarette consumption for adults (6). Cigarette tax increases can also achieve long-term smoking reductions because they disproportionately affect the smoking prevalence among younger adults (7).

On July 15, 2002, Pennsylvania raised its cigarette excise tax by $0.69, from $0.31 to $1.00 per pack. On January 7, 2004, the cigarette excise tax was raised again, this time by $0.35, from $1.00 to $1.35 pack. Although states generally increase cigarette excise taxes to raise revenues and provide funding for state tobacco-control programs (8), indirect effects of these measures include a reduction in smoking consumption (prevalence and number of cigarettes smoked) and tobacco-related health consequences.

The objective of our study was to assess the impact in Pennsylvania of 2 increases in cigarette excise tax and the resulting price increase on either an immediate reduction or long-term change in the trend of smoking prevalence, AMI and asthma hospitalization rates, and sudden cardiac death (SCD) rates. These health conditions were chosen because they have been clearly linked to exposure to tobacco smoke.

The Pennsylvania cigarette excise tax increases were found to be effective in decreasing smoking prevalence only among adults aged 18 to 39 after the second tax, which increased the price to more than $4.00/pack. After each tax increase, cigarette consumption decreased, according to the number of packs of cigarettes sold (11). In other words, despite the increase in per-pack tax, the actual state tax revenues from cigarettes sales decreased (11). To our knowledge, no studies have evaluated the effectiveness of the Pennsylvania excise tax increases on reducing adult smoking prevalence or on adverse health effects.

Our findings are consistent with those of the National Academy of Sciences’ IOM 1998 report “Taking Action to Reduce Tobacco Use” (16) and its updated 2007 report “Ending the Tobacco Problem” (8), which conclude that the single most direct and reliable method for reducing tobacco consumption is to increase the price of tobacco products. The National Cancer Institute Expert Panel’s report provides relevant information regarding the influence of both smoking prevalence and number of cigarettes smoked on cigarette consumption (6). That is, a 10% increase in cigarette price has been found to reduce overall cigarette consumption by approximately 3% to 5%; approximately two-thirds of this reduction in consumption is attributed to individuals choosing not to smoke at all (6). Our findings support a recent study that reported the inverse, namely, that reductions in cigarette consumption are mainly due to reductions in consumption by smokers (64%) rather than reductions in smoking prevalence (36%) (17).

A review of Pennsylvania’s cigarette price history reported the average per pack price in 2001 was $3.20 with $0.65 per pack overall tax (18). The average per pack price increased $0.78 to $3.98 in 2002 after the first Pennsylvania cigarette excise tax increase of $0.69. However, the price per pack further rose $0.32 in 2004 to $4.30 when the second excise tax increased $0.35 to $1.74 overall tax (18). One should also be cognizant that tobacco companies may adjust prices to absorb part of the tax increase so it is not passed to the consumer (19).

The significant decline in smoking prevalence among adults aged 18 to 39 after the second excise tax increase may be the result of the overall per pack price ($4.30) finally exceeding the psychological tipping point of $4.00 per pack. Our findings provide additional evidence to support the IOM reports (8,16) that it is not the cigarette tax itself but the overall price resulting from the tax increase that may prompt changes in smoking prevalence and trends. Younger smokers, especially those under age 20, are much more sensitive to overall price than older smokers. Older adults are likely to have smoked longer and are more likely to demonstrate long-standing addictive behaviors that are more difficult to modify. Older adults are also more likely to be able to financially adjust to cigarette price increases and thus have a higher tipping point for smoking cessation. This is consistent with results from other studies that indicate cigarette excise tax increases have a greater impact on younger adults than on older adults because of their economic status (7). Cigarette taxes and effects of price increases on the smoking habits of older adults need to be studied further.

Our findings are consistent with previous studies that show a positive association between smoking and trends in AMI and asthma (20–27). Although the second tax increase did not significantly alter the trend in the AMI hospitalization rate, it did appear to reset the trend line, producing a 3.22/100,000 population overall rate reduction. This translates into more than 350 fewer AMI hospitalizations per year in Pennsylvania. In 2009, the average AMI hospitalization length of stay was 5.25 days and the average hospitalization charge was $71,057 in Pennsylvania (PHC4 data). This correlates with approximately 2,000 fewer hospitalization days and an estimated savings of $25 million in hospital charges. There was also a significant reduction in the level of the age-adjusted SCD rate following the second tax increase for men but not for women. This may simply reflect the greater burden of SCD in men than women. This apparent paradox, of no significant change in smoking prevalence among the older at-risk adults corresponding to a reduction in AMI hospitalization rates and SCD, may be partially explained by the decrease in cigarette consumption by all adults (11) (rather than decrease in smoking prevalence) and reduced secondhand smoke exposure.

The first tax increase was associated with a significant decrease in the level but an increase in the trend of asthma-associated hospitalizations. The second tax increase was associated with further decreases in the level and reversed the trend of the asthma hospitalization rate. These changes were much more pronounced in younger age groups, especially in those under 18 years of age. These age-specific differences in the impact of the increased excise tax may be related to the decline in smoking prevalence among young adults aged 18 to 39 who no longer expose their children under 18 years old to secondhand smoke.

A major strength of our analytical approach is that we used the more rigorous interrupted time-series method (15), which controls for baseline level and trend when estimating the changes due to Pennsylvania cigarette excise tax increases. This quasi-experimental design is preferred over the simpler pre- and postproportion comparison method (23,27) that does not take the preintervention trend into consideration. The conclusions may be flawed in pre–post analyses because there is no accounting for the preintervention overall trend that would have continued without the intervention. We also found evidence of autocorrelation in the data and adjusted with Yule-Walker autoregression method, which usually is not considered in simpler pre-post proportional analysis. Another strength of our analytic approach is that we used hospital discharge data that include all cases rather than a sample. In addition, our smoking prevalence estimates represent the smoking prevalence in Pennsylvania because they were derived from BRFSS, a well-designed multiple stage stratified survey designed to represent the state. The use of multiple robust data sources adds to one’s confidence in the validity of our findings.

There are several limitations of this analysis. We examined the relationship of the excise tax increases on only 3 conditions. These conditions were chosen because they are known to be affected by smoking in a short term. However, AMIs and SCDs are rare in adults aged 18 to 39, and asthma is less common in older adults. This may have limited the likelihood that the associations with excise tax increases would reach significance. Second, this is an ecological explorative study and causal inferences cannot be strictly made. The study was based on overall state rates with no specific control group, but the interrupted time-series method compares both trend and level pre-tax and post-tax, controlling for all other unknown factors (15). Other factors temporally related to the excise tax increases may influence smoking prevalence and could potentially inflate the effectiveness of the cigarette tax and price effect. We examined this possibility but did not find any significant health program changes during the study period. Third, medical treatment and other improvements in the prevention and management of AMI and asthma could not be addressed in the analysis. However, it is unlikely that these improvements would be so closely aligned with the excise tax changes that were the basis for the analysis. Health insurance coverage and access to health care and hospitals could also influence our findings but they could not be assessed in this analysis.

Although the impact of the excise taxes on overall smoking prevalence were not as dramatic as predicted from other studies, the analysis in this study suggests that the increase in excise tax, along with the increase in price, decreased smoking prevalence in younger adults and was positively correlated with changes in asthma hospitalizations, especially in the young, and with the occurrence of SCD and AMI hospitalizations in men. Additional research and policy development is needed to assess the effectiveness of further cigarette taxes in decreasing 1) tobacco consumption (smoking prevalence and amount of cigarettes smoked) while being cognizant of psychological tipping points for price; and 2) smoking-related health outcomes and health care costs.