MULTI-STATE TOBACCO SETTLEMENT

7.  Possible Federal Right To Some Of The Payments

Given that some portion of the tobacco companies' payments are to reimburse states for their tobacco-caused Medicaid expenditures, the federal government (which pays 50 percent or more of each state's Medicaid expenditures) has a statutory claim on a corresponding portion of the tobacco companies' payments. Whether the Congress will waive this claim is not yet known. If the federal government does waive its claim, it is possible that the waiver will be conditional on the states directing some minimum portion of their settlement receipts to increased efforts to reduce tobacco use and for other related public health initiatives.

 

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