Medical Marijuana Lowers Medicare Drug Costs

A University of Georgia study has found that the use of medical marijuana significantly lowers the costs of Medicare’s Part D program, due to the reduced demand for prescription drugs.

The study, conducted by UGA researchers W. David and Ashley Bradford, looked at prescriptions filled by Part D participants from 2010-2013, which totaled more than 87 million observations. They then checked costs in states where medical marijuana is legal and narrowed the search to nine conditions for which marijuana can treat, including anxiety, depression, glaucoma, nausea, pain, psychosis, seizures, sleep disorders and spasticity.

The results showed that if every U.S. state were to legalize cannabis, $468 million would be saved in Part D costs. That’s a $303 million increase over the money that was saved in the 18 states where medical marijuana was legal in 2013.

“When marijuana becomes a medical option for people, then their use of prescription drugs falls,” said David Bradford, one of the authors of the study. “We think that the only plausible mechanism is that people are shifting at least in part toward using marijuana as medicine.”

Of the categories studied, it was found that annual prescriptions decreased by 3,645 doses per doctor for pain and by 1,280 doses for depression. This is particularly noteworthy, considering the enormous increase of opioid use for chronic pain in the U.S.

The only condition of the nine that didn’t show a decrease in prescription costs was glaucoma. This is most likely because the eye pressure caused by glaucoma is only reduced by cannabis for one hour, so additional medication is usually needed.

The researchers also did an analysis on drugs that are not associated with cannabis treatment, such as blood thinners and antibiotics, and did not find a difference in the prescription drug patterns between states with and without legalized medical marijuana.

Part D is Medicare’s prescription drug program funded by the federal government to lower the costs of drugs for Medicare recipients. It’s only available to people age 65 and older and accounts for about 20 percent of total U.S. healthcare costs. The Part D budget was $103 million in 2013, so the savings shown in the study would be about one half of a percent.

Still, it’s enough of a savings to spur the Bradfords to now expand their research to include Medicaid prescription data, as the drug savings for the entire population could be much greater. The Bradfords note that “previous studies have suggested that Medicare patients may make up a relatively small percentage of people who use medical marijuana and that only 13–27 percent of people who used medical marijuana were ages 50 and older.”

Marijuana is currently legal for medical purposes in 29 states and in Washington, D.C., though specific state laws vary. The federal government still classifies it as Schedule 1 substance, however, so Medicare refuses to cover the cost even if it’s recommended by a doctor. Since it would violate federal law, doctors may not prescribe cannabis; they may merely recommend or suggest its use, instead.

Even though the Food and Drug Administration (FDA) hasn’t approved the use of marijuana for medical uses, it has approved three cannabinoid-based medicines that are derived from synthetic sources. This could indicate at least some acknowledgment by the FDA of the benefits of medical cannabis.

Peggi Clough

Peggi Clough

Peggi Clough is a freelance writer and editor whose clients have included Hallmark Cards, Cerner Corporation and Village Voice Media. Prior to freelancing, she was an editor for National Seminars Training. Peggi is committed to fighting for the legalization of medical cannabis in her home state of Missouri.


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