In his recent fiscal year 2019 federal budget proposal, President Trump added $3 billion in 2018 federal spending to combat the country’s opioid crisis and $10 billion in 2019. The budget deal struck by Congress last week already contained $3 billion for 2018 and $3 billion for 2019. The President’s budget then, adds a total of $7 billion over two years.
What has the opioid crisis cost the United States and how much more will it cost in the near future? According to a report out Tuesday from Altarum, a non-profit health research and consulting institute, since 2001 the opioid crisis has cost $1 trillion in lost wages, lost productivity, healthcare costs, and lost tax revenues in addition to direct spending for healthcare, social services, education, and criminal justice.
Based on an average age of death from an overdose of 41, lost earnings and productivity are estimated to total $800,000 per person. In 2017 the number opioid overdose deaths exceeded 62,500 (extrapolated from data through June). The loss totaled about $50 billion.
For the four years from 2016 to 2020, Altarum estimates that the opioid epidemic will cost another $500 billion. The annual loss rose from $60.9 billion 2011 to $95.8 billion in 2016, a jump of more than 57% over the five year period. By 2020 the annual loss attributable to the opioid epidemic is forecast at $199.9 billion.
The President’s proposal for spending on the opioid crisis does not include the effect of repealing and replacing the Affordable Care Act (Obamacare). Altarum estimated that the healthcare portion of losses from the opioid epidemic totaled about $216 billion for the years between 2001 and 2017:
A disproportionately large share of this cost has been borne by Medicaid in recent years. Since Medicaid expansion in 2014, the number of overdoses connected to uninsured patients has fallen substantially, but the burden to states in additional health care costs has increased.
It is likely that even if the federal budget includes $13 billion to tackle the opioid epidemic that total would be more than offset by the cost to healthcare providers from the loss of Medicaid funds. Keith Humphreys, a drug policy expert at Stanford University, told Vox News, “On balance, this is a net cut in health services for people with opioid problems.”