I will join with those that think this is an unreasonable intrusion into employee's privacy.
I have no problem with hospitals tesing for illegal substances. They are illegal, and no one should be using them. We can have a debate about whether some (or all) of them should be legalized, but until they are I'm fine with that policy. THC aside, substance use has been shown to correlate with professionalism issues, etc.
I also have no problem with hospitals making their campuses smoke free. Mine is. There are NO smoking areas. You can't smoke anywhere. I believe that if visitors go outside and are far away enough from the door (which means quite far), no one will bother them. But technically the policy covers all of our property.
But I do have a problem with hospitals demanding that incoming employees be non smokers. I am a non smoker, so this doesn't affect me at all. But I agree that people have a right to engage in any activity that is legal in their own time, off campus.
The worry is where does this stop. Not hiring people because of their weight? What about based upon their hobbies -- what if a hospital demands that no one downhill ski, since that's dangerous and you might get hurt. Or what if an employee is an avid hunter, and the hospital thinks that injures their "brand".
I also have no problem if the hospital charges higher health premiums based upon lifestyle issues. Totally reasonable to charge someone who is a smoker more, or whose BMI is high more, or someone who engages in some "dangerous" activity. In fact, I like the idea of hiring people, testinging them for cotinine, if positive give them assistance in quitting, and if positive in 3-6 months, then increasing their health premiums. Same for high BMI. Seems like a good balance -- we try to help you improve your health, if you don't then you end up paying more for the increased financial risk.