Furthermore, if they die later, they consume more Social Security and other things generally consumed by older people.

If human life is valueless, then there are even greater savings to be had than allowing tobacco use or subsidizing extreme sports...

unless death by old age is substantially cheaper than death by lung cancer

It is. Ignoring the costs of dying years earlier to the person in terms of DALYs/QALYs, smokers work less, are less healthy, have more comorbidities, worse outcomes from treatment, their cancers are long-lasting and require more expensive treatment than other things nonsmokers would die from (compare months or years of fighting lung cancer in your 50s to dying of a stroke while asleep in your 80s). 'compression of morbidity'/rectangularization might also imply that diseases in late life will generically be cheaper because they are more likely to be quickly fatal and periods of disability shorter.

For lifestyle interventions to reduce healthcare costs you should incentivize people, especially older people, to take up extreme sports. For the best savings you want people to suddenly die just as they are starting to get sick more often.

I would recommend subsidies for things like ultralight airplanes, BASE jumping, fist-fighting sharks, and competitions to see who can get the furthest into the open ocean before his ice floe melts...