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Regulation and Compliance > State Regulation

Medical marijuana saving Medicare millions

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Opponents of marijuana, beware: A study has found that in states where marijuana is legalized, Medicare saved millions of dollars as marijuana displaced other prescription drugs as an alternative treatment.

See also: Marijuana from an underwriting perspective

Forbes magazine says that the study, published in the journal Health Affairs by a father-and-daughter research team, examined Medicare data for the period of 2010 to 2013 on prescription drug usage, seeking “to answer two questions: are patients choosing marijuana instead of prescription drugs for conditions that marijuana might treat, and what has been the overall effect on Medicare spending?”

In 2013, 17 states legalized marijuana. And in that year alone, Medicare was in the black by $165 million as patients, or their doctors, opted for the alternative treatment. The Forbes piece points out that, by simple extrapolation, legalization of marijuana by the rest of the states could result in even more substantial savings.

Ashley Bradford and David Bradford, researchers at the University of Georgia, checked more than 87 million Medicare Part D database prescriptions, looking only at those conditions for which marijuana might serve as an alternative treatment. Nine specific categories fill that requirement: anxiety, depression, glaucoma, nausea, pain, psychosis, seizures, sleep disorders and spasticity.

In eight of the nine categories, prescriptions dropped; the largest decrease was for pain medication, with depression and seizures also showing substantial decreases. The only category that experienced an increase was glaucoma, and the study had an answer for that. Marijuana’s effect on intraocular pressure is of short duration — only about an hour. So patients who opted for it rather than another drug are likely to end up with an FDA-approved medication.

States having medical marijuana laws saw a decrease of 3,645 fewer pain prescriptions per doctor, which is strongly statistically significant. Between 2010 and 2013, the annual number of daily doses per doctor in states that did not have medical marijuana laws was 31,810. In states with medical marijuana, that number dropped to 28,165 — a decrease of 11.5 percent.

The study suggests that as marijuana becomes legal in more states, the amount of money it could save Medicare — not to mention regular insurance, which was not part of the study — could amount to “hundreds of millions of dollars” — and it could also save money in law enforcement costs that is currently spent on prosecuting marijuana use.


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