Can Marijuana Help Address the U.S. Health Spending Crisis?

SageElyse / Shutterstock.com

The rising cost of prescription drugs is a bitter pill to swallow for many Americans (and their insurers — Medicare included). So this comes as a bit of good news: In states that have legalized marijuana for medicinal use, spending on prescription drugs has declined.

That’s according to new research from a University of Georgia father-daughter duo, which was recently published in the July issue of the journal Health Affairs.

The study analyzed prescription drug data from Medicare Part D — Medicare’s prescription benefits program — from 2010 to 2013. It focused on nine medical conditions for which marijuana could serve as an alternative treatment, including anxiety, depression, glaucoma, nausea, pain, psychosis, seizures, sleep disorders and spasticity.

After crunching the numbers, the researchers concluded that marijuana use saved Medicare Part D about $165.2 million in 2013 — as many people chose weed instead of prescription drugs to help them with their medical conditions. Marijuana for medical and/or recreational use was legal in 17 states and the District of Columbia at the time of the study. Now it’s legal in 25 states plus the District of Columbia.

The results of the study by professor W. David Bradford and graduate student Ashley Bradford suggest that if all 50 states had medical marijuana provisions in place in 2013, then Medicare Part D could have pocketed about $468 million in total savings that year, as more people chose marijuana, instead of pharmaceuticals, to treat their health ailments.

“When marijuana becomes a medical option for people, then their use of prescription drugs falls,” said David Bradford, a professor of public administration and policy at UGA and co-author of the study with his daughter Ashley Bradford, a graduate student in public administration and policy. “We think that the only plausible mechanism is that people are shifting at least in part toward using marijuana as medicine.”

Although the $468 million in potential savings in 2013 represents just a half a percent of Medicare Part D’s total expenditures, Bradford says it’s still significant.

“We wouldn’t say that saving money is the reason to adopt this. But it should be part of the discussion,” Bradford said in an interview with NPR. “We think it’s pretty good indirect evidence that people are using this as medication.”

The UGA study is the first of its kind to examine whether legalizing marijuana could help curb rising public health costs and even change doctors’ clinical practice, says NPR.

Despite the change in state laws governing marijuana’s use and sale, the drug is still illegal under federal law, which classifies it as a Schedule I drug along with heroin. Among other things, that means doctors can write patients a note to get weed from a dispensary, but they can’t actually prescribe it. Marijuana also has to be paid for out-of-pocket.

The next study the researchers are planning is designed to analyze marijuana’s potential impact on Medicaid.

Check out our post on retirees and pot: “Forget Florida: Retirees Opting for Pot-Friendly States.”

How do you feel about legalizing marijuana for medicinal purposes? What about recreational purposes? Sound off below or on our Facebook page.

Find the right financial adviser

Finding a financial adviser you can trust doesn't have to be hard. A great place to start is with SmartAsset's free financial adviser matching tool, which connects you with up to three qualified financial advisers in five minutes. Each adviser is vetted by SmartAsset and is legally required to act in your best interests.

If you're ready to be matched with local advisers who will help you reach your financial goals, get started now.

Read Next
What Brand Makes the Best Rechargeable AA Batteries?
What Brand Makes the Best Rechargeable AA Batteries?

The best battery depends on what you need it for and how big your budget is. Here’s how to find the cheapest brand that will do the job you need.

3 Cable TV Companies Hiking Prices for 2020
3 Cable TV Companies Hiking Prices for 2020

Still married to your cable company? Hold on to your wallet!

70% of Older Adults Botch This Basic Retirement Question
70% of Older Adults Botch This Basic Retirement Question

Can you answer this fundamental retirement income question?

5 Surveys For Money Sites To Get Paid For Your Opinion
5 Surveys For Money Sites To Get Paid For Your Opinion

Yes, you can earn extra cash by taking online surveys. But some websites are better than others for this. Here are a few of our favorites.

These 13 States Tax Social Security Income
These 13 States Tax Social Security Income

Uncle Sam is not the only one looking for a piece of your retirement income. Is your state on this list?

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Most Popular
Will I Get My Ex-Husband’s Social Security When He Dies?
Will I Get My Ex-Husband’s Social Security When He Dies?

Two factors determine how much money is coming to you.

7 Ways to Boost Your Credit Score Fast
7 Ways to Boost Your Credit Score Fast

Your financial security might soon depend upon the strength of your credit score.

21 Things You Should Always Buy at a Dollar Store
21 Things You Should Always Buy at a Dollar Store

Dollar stores have great bargains on these familiar purchases. Yes, even pregnancy tests.

13 Brilliant Bulk-Buy Items on Amazon
13 Brilliant Bulk-Buy Items on Amazon

Every household should have these products on hand. Buying them in bulk on Amazon saves you cash.

6 Reasons I Will Never Trust Suze Orman
6 Reasons I Will Never Trust Suze Orman

Beware: The self-proclaimed personal finance expert has a track record that suggests more sizzle than steak.

This Type of Social Security Benefit Is Often Overlooked
This Type of Social Security Benefit Is Often Overlooked

The Social Security Administration is not helping certain people get money to which they are entitled, a report says.

Getting These 2 Shots Could Reduce Your Risk of Dementia
Getting These 2 Shots Could Reduce Your Risk of Dementia

These vaccines may lower the risk of Alzheimer’s disease by up to 40%.

9 Everyday Problems You Can Solve With Vaseline
9 Everyday Problems You Can Solve With Vaseline

Forget expensive specialty products. Good ol’ petroleum jelly can address many common annoyances.

America’s Most Reliable Appliance Brand Is a Surprise
America’s Most Reliable Appliance Brand Is a Surprise

Have you heard of this appliance manufacturer?

16 Amazon Purchases That We Are Loving Right Now
16 Amazon Purchases That We Are Loving Right Now

These practical products make everyday life a little easier.

19 Purchases That Buyers Almost Always Regret
19 Purchases That Buyers Almost Always Regret

Think twice before buying these things.

19 High-Paying Jobs You Can Get With a 2-Year Degree
19 High-Paying Jobs You Can Get With a 2-Year Degree

These jobs pay more than the typical job in the U.S. — and no bachelor’s degree is required.

7 Tips for Building an Emergency Stockpile
7 Tips for Building an Emergency Stockpile

A pandemic or natural disaster could leave you reliant on your existing food supply. Is your pantry prepared?

8 of the Worst Things to Buy at a Dollar Store
8 of the Worst Things to Buy at a Dollar Store

Not everything sold at dollar stores is a great bargain or a safe purchase. Here’s our list of products to avoid.

Homeowners Say These 2 Kitchen Appliance Brands Are Best
Homeowners Say These 2 Kitchen Appliance Brands Are Best

One brand takes five of the top honors, while another ranks highest in three categories.

41 Things You Should Never Buy
41 Things You Should Never Buy

Some purchases are just plain dumb. Give yourself — and your budget — a break. Don’t spend money on this stuff.

9 Indestructible Products That Are Worth the Price
9 Indestructible Products That Are Worth the Price

If you’re willing to pay a little more for these products, you may never have to shop for another again.

5 Ways to Get Amazon Prime for Free
5 Ways to Get Amazon Prime for Free

Hesitant to drop $119 a year on an Amazon Prime membership? Here’s how to get it for free.

5 Household Disinfectants That Can Destroy the Coronavirus
5 Household Disinfectants That Can Destroy the Coronavirus

You likely already have some of these products at home.

View More Articles

View this page without ads

Help us produce more money-saving articles and videos by subscribing to a membership.

Get Started

Add a Comment

Our Policy: We welcome relevant and respectful comments in order to foster healthy and informative discussions. All other comments may be removed. Comments with links are automatically held for moderation.