In 1998 the attorneys general of 46 states entered into an agreement with four U.S. tobacco companies called the Tobacco Master Settlement Agreement. These states would receive money from the companies to recover Medicaid “tobacco-related-health-care costs” and the tobacco companies would be exempt from lawsuits from private citizens who had been harmed by tobacco. The settlement allowed for stronger warning labels and bans on advertising, as well as payment of about $200 billion by the companies over 25 years. States were supposed to use the money to help pay for the health costs in their state attributed to tobacco use and to fund youth tobacco prevention programs. That didn’t happen in most states, but Oklahoma looked to the future.
While other states have used the funds on everything but health care concerns, Oklahoma voters had a say in what to do with their funds. The Tobacco Settlement Endowment Trust was created in 2000 and approved by voters. The “state’s general fund gets 25% of annual settlement proceeds” which have been consistently dedicated to health care. The other 75% goes directly to the endowment.
“The endowment fund is now generating as much in earnings each year as it is getting from the tobacco companies.” Earnings totaled $52.7 million this year and a deposit of $57.9 million brought the total endowment to $975 million. When the payments from the Master Settlement Plan stop, Oklahoma will have still millions to spend on health care each year. All citizens in Oklahoma are benefiting from the TSET funds as it is used for tobacco prevention efforts, and health programs such as nutrition and wellness.
Let’s hope the wise citizens of Oklahoma keep the endowment fund intact to provide money for health care well into the future.
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