Note that smoking is actually a net benefit. Smokers tend to die about the time that they start collecting retirement benefits. So, they pay in their entire working lives and get almost no return. (Black men are particularly hosed by this while non-smoking white women make out like crazy.)
One point made in this article is that most health care costs are in fact preventative.
"Safeway's plan capitalizes on two key insights gained in 2005. The first is that 70% of all health-care costs are the direct result of behavior. The second insight, which is well understood by the providers of health care, is that 74% of all costs are confined to four chronic conditions (cardiovascular disease, cancer, diabetes and obesity). Furthermore, 80% of cardiovascular disease and diabetes is preventable, 60% of cancers are preventable, and more than 90% of obesity is preventable."
Given this statement, the money spent preventing these issues will be far less than the amount required to correct these issues in people once they get to the point of needing some type of hospital procedure or operation.
You're assuming that you spend prevention costs perfectly when you can't.
The money that you spend on someone to prevent/reduce a problem is completely wasted if that is not suseptable or is struck by something else. (Also, the cost to deal with obesity and diabetes together is less than the sum of dealing with obesity and diabetes separately.) It's also wasted if the person gets the problem anyway.
And, you're still ignoring the benefits of early death.
Better preventative care doesn't reduce costs, it increases them.
http://www.nytimes.com/2007/08/08/business/08leonhardt.html?...
Note that smoking is actually a net benefit. Smokers tend to die about the time that they start collecting retirement benefits. So, they pay in their entire working lives and get almost no return. (Black men are particularly hosed by this while non-smoking white women make out like crazy.)