Medical marijuana cuts costs of Medicare’s prescription drug benefit program

marijuana bud
Medical marijuana is legal in 25 states, and is reducing costs for Medicare’s prescription drug benefit program, according to a new study.

Patients using cannabis as alternative to prescription drugs

Staff Report

A new study by health experts at the University of Georgia suggests that people are using marijuana as an alternative to prescription medications for ailments that range from pain to sleep disorders.

That trend translates to about $165.2 million in savings for Medicare’s prescription drug benefit program in 2013, the researchers reported in the journal  Health Affairs.The results suggest that if all states had implemented medical marijuana the overall savings to Medicare would have been around $468 million.

The can give policymakers and others another tool to evaluate the pros and cons of medical marijuana legalization, said study co-author W. David Bradford, who is the Busbee Chair in Public Policy in the UGA School of Public and International Affairs.

“The results suggest people are really using marijuana as medicine and not just using it for recreational purposes,” said the study’s lead author Ashley Bradford, who completed her bachelor’s degree in sociology in May and will start her master’s degree in public administration at UGA this fall.

The study involved analyzing data for  all prescriptions filled by Medicare Part D enrollees from 2010 to 2013, a total of over 87 million physician-drug-year observations. They narrowed the results down to nine categories in which the Food and Drug Administration had already approved at least one medication. These were anxiety, depression, glaucoma, nausea, pain, psychosis, seizures, sleep disorders and spasticity.

Marijuana is still classified federally as a drug with high abuse potential. Several states don’t agree with this assessment, and, in 1996, California became the first to legalize it for medical purposes, followed by Alaska, Oregon and Washington in 1998. As recently as June of this year, Pennsylvania and Ohio passed laws allowing its medical use.

Each of the 25 states plus the District of Columbia with a medical marijuana law has different guidelines for its use and possession limits. Also, physicians in these states may only recommend its use; it remains illegal for them to prescribe the medication.

“Doctors can recommend marijuana and in some states can sign a form to help you get a card, but at that point you go out of the medical system and into the dispensaries,” he said. “What does this mean? Do you then go less frequently to the doctor and maybe your non-symptomatic hypertension, elevated blood sugar and elevated cholesterol go unmanaged? If that’s the case, that could be a negative consequence to this.”

The researchers will explore these consequences further in their next study, Ashley Bradford said, which will look at medical marijuana’s effects on Medicaid, a joint federal and state program that helps with medical costs and typically serves an older population.

They expect the cost savings seen in their current study to be repeated when they look at Medicaid, saying their findings suggests a more widespread state approval of medical marijuana could provide modest budgetary relief. Their current study suggests total spending by Medicare Part D would have been $468.1 million less in 2013 if all states were to have adopted medical marijuana laws by that year, an amount just under 0.5 percent of the prescription drug benefit program’s spending.

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One thought on “Medical marijuana cuts costs of Medicare’s prescription drug benefit program

  1. Medical marijuana isn’t an *alternative* to prescription medications – it IS a prescription medication. You can get MMJ without a prescription.

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