WHITE HOUSE STUDYING SUIT TO RECOVER TOBACCO COSTS

WASHINGTON - The White House said Tuesday it was considering suing the
tobacco industry to recover smoking-related health care costs if Congress
failed to pass a broad anti-smoking bill.

Administration officials said a suit was one of several alternatives being
studied to deal with a defeat on the anti-smoking legislation they were
seeking. But they made clear the administration intended to make the
industry pay.

``The issues about litigation and how the federal government recovers and
recoups some of the cost that U.S. taxpayers have spent for the payment of
health-care claims related to tobacco use and tobacco disease is clearly a
concern,'' White House spokesman Mike McCurry said.

``In a very preliminary way it's being examined, but first and foremost our
interest is in comprehensive legislation,'' McCurry told reporters, in
response to a question on whether the White House was considering suing the
industry.

``One way or another, the effort to protect kids from tobacco use, and the
effort to assemble the kind of resources we need to counteract the effect
of tobacco advertising and tobacco addiction (is) going to proceed,''
McCurry said.

A White House official said a suit was only one of the alternatives being
considered, but he declined to identify others.

A tobacco industry representative expressed skepticism about the prospects
for any federal suit. ``The federal government has reviewed this before and
has testified (in Congress) that the federal government does not have an
independent cause of action,'' said industry spokesman Scott Williams.

The search for alternatives to legislation follows last month's collapse of
a $516 billion anti-smoking bill in the Senate.

The bill would have forced the tobacco industry to make payments to fight
teen smoking, reimburse states for health-care costs related to smoking and
fund health and social measures such as medical research and aid to farmers.

The collapse led to a revival of talks between the tobacco industry and a
group of states suing it toward a multibillion dollar settlement that would
not involve the federal government or a need for Congressional legislation.

State attorneys general have been discussing the prospects for a new
settlement during a meeting in Colorado this week.

The Treasury Department has estimated smoking costs the economy about $130
billion a year, including $60 billion in medical bills. Some $20 billion in
health costs are borne by the federal Medicare program and the
state-federal Medicaid program, the department estimates.

The Department of Health and Human Services was taking part in the
evaluation, but the Justice Department would have to file any suit, the
White House official said.

A federal counterpart to the state suits against the tobacco industry has
been urged in the past by Democratic lawmakers. But the Justice Department
has not acted after earlier investigations of the issue.

McCurry rejected suggestions that the current discussion of a federal suit
was aimed at reviving industry participation in talks toward an
anti-smoking bill.

``I'm not sure that would be an undesirable effect,'' he said. ``I don't
think that's the intent.''

Checked-by: Mike Gogulski