Smokers on average don't die that much younger. But they do have a much less healthy end of life.

The life expectancy of male smokers, ex-smokers, and never-smokers at age 40 years was 38.5, 40.8, and 42.4 years respectively. In women, the corresponding life expectancies were 42.4, 42.1, and 46.1 years.

For private healthcare maybe? A lot of the reasons private insurance groups are even somewhat functional is because the vast majority of healthcare cost are shifted over to medicare once people start falling apart.

Most things like cardiovascular disease and lung cancer happen in the late 50s or older. People who aren't yet old enough for medicare will file for disability to access it earlier in the event of severe illnesses.