OPIOIDS IN AMERICA:

Economic and Social Consequences

Texas Legislative Council

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Part 2:

Economic and Social Consequences

Part 3:

Calls to Action

Part 4:

The State of Texas

Opioids in America

America's opioid crisis is worsening, and the recent shift  from prescription opioid abuse to use of illicit synthetic opioids and heroin has made it difficult to collect and analyze the data necessary to definitively measure the impact of the crisis.

This installment of TLC's Opioids In America series examines the national scale of the crisis.

Opioids in America

Nonfatal opioid misuse cost the country $72.3 billion in 2015, according to the White House Council of Economic Advisers.

The Big Picture

The total economic impact of the crisis in that year exceeded $500 billion when accounting for the value of each statistical life lost to an opioid overdose death.

The numbers that have been reported present a blurred but deeply troubling picture of the broad economic and social costs of the crisis.

Opioids in America

Some nonprofit research organizations paint an even starker picture. 

The Altarum Institute estimates that the cost of lost productivity and the increased spending directly associated with the opioid crisis exceeded $1 trillion between 2001 and 2016.

Moreover, between 2011 and 2016 those costs grew at a rate double that of the previous five-year window.

The Big Picture

Projected

Costs

$1 trillon

Opioids in America

Despite the challenge of precisely measuring the socioeconomic consequences of the opioid crisis, those attempting to quantify its effects have largely focused on four broad categories that highlight the economic and societal impact of the crisis and the potential consequences for governmental spending:

 Lost productivity

Healthcare costs

Strains on the criminal justice system

Economic and Social Costs

Stresses on families and state foster care systems

Opioids in America

Available data suggests that the largest percentage of the economic loss associated with the opioid crisis is due to:

Lost productivity reached an estimated $55.6 billion in 2016 alone.

Lost Productivity

• Lost wages

• Decreases in employee productivity

• Lost tax revenue

Opioids in America

Healthcare spending is one area of concern that has yielded readily available data. 

Healthcare Spending

In 2015, opioid abusers cost employers nearly 80 percent more in healthcare expenses on average than other employees. 

That same year, the average cost of caring for an opioid overdose patient in a hospital intensive care unit was $92,400. 

Opioids in America

These costs represent a tremendous threat to rural hospitals, which disproportionately serve the uninsured and patients relying on Medicaid and other forms of public insurance.

Healthcare Spending

Residents in most rural communities have inadequate access to counseling, addiction treatment, and other forms of early medical intervention that can mitigate expensive hospital admissions, contributing to the fact that Medicaid is the expected payer for the greatest number of opioid-related hospital uses.

Opioids in America

Medicaid spending on common opioid-abuse treatment prescriptions increased 136 percent between 2011 and 2016, and combined with increased hospital use by Medicaid patients, the impact to state budgets is clearly severe. 

Between 2014 and 2016, Medicaid enrollees were prescribed opioids by their primary care provider at twice the rate of commercially insured patients. 

Healthcare Spending

Healthcare Spending

Opioids in America

Criminal Justice

From 1990 to 2013 the white incarceration rate increased 88 percent, a rise much greater than that for other population groups. This increase was especially pronounced in rural areas, where the rate increased by 165 percent.

Experts suggest that opioid abuse may be a significant driver of this increase, as non-Hispanic whites, especially those in rural areas, make up a disproportionate share of opioid abusers, as was discussed in 

These additional incarcerations correspond with a greater need for judicial and legal services, as well as a larger police presence, necessitating billions of dollars in additional criminal justice spending.

White Incarceration Rate (per 100,000 white population)

1990-2013

Opioids in America

Opioid abuse also has far-reaching impacts that extend beyond those affecting the abuser, and many of the consequences of opioid abuse fall on the families of abusers, particularly on the children of mothers suffering from addiction.

Between 2003 and 2012, hospital admissions increased more than 400 percent for neonatal abstinence syndrome, a condition that occurs in infants who have been exposed to opioids.

Families and Foster Care

The average hospital charge in 2012 for such an infant was $66,700, as compared to $3,500 for an infant who had an uncomplicated birth. 

Opioids in America

In fiscal year 2016 parental drug abuse factored into the removal of more than 92,000 children nationwide. In that year, the share of removals due to parental drug abuse was 110 percent higher than in fiscal year 2000.

Families and Foster Care

The dramatic increase in the number of Americans abusing opioids appears to be stressing state foster care systems as well.

Opioids in America

At the same time, many children of drug abusers remain outside the foster care system in informal kinship care agreements with grandparents or other relatives, further stressing vulnerable families.

Recent trends in opioid abuse also correspond with a troubling spike in the total number of children in foster care. After years of steady decline,  the number suddenly rose by 10 percent from fiscal year 2011 to fiscal year 2016.

Families and Foster Care

Opioids in America

As more data becomes available regarding the economic and societal costs of America's opioid epidemic, the magnitude of the current situation only becomes more apparent. 

What Next?

Spending associated with the crisis is projected to increase substantially in the coming years. The Altarum Institute estimates that the single-year economic burden in 2020 will reach nearly $200 billion.

Projected single-year burden

Opioids in America

The widening impact of the opioid crisis has created a growing sense of urgency and demands for action. But what measures are being taken to confront this public health emergency, and what does the future hold for the millions of Americans who have been directly and indirectly affected by this epidemic? 

The next presentation in TLC's Opioids in America series will examine steps taken by various levels of government to address and mitigate opioid abuse and misuse.

Sources:

For questions, please contact Logan Moore in the TLC Research Division at (512) 463-1155.

Opioids in America