Tobacco use can significantly impact premium rates in small group health insurance plans. Insurers are allowed to charge higher premiums to tobacco users, a practice known as tobacco rating. The Affordable Care Act permits insurers to charge tobacco users up to 50% more than non-tobacco users in some states. This surcharge is applied to account for the higher health risks and potential costs associated with tobacco use. That said, most states to not use tobacco use as a rating factor for small group plans.