A new study published in Health Economics has found that recreational marijuana laws are associated with lower prescription drug expenditures among working-age adults covered by small group insurance plans.
Researchers from Illinois State University, Bowling Green State University, and the University of Texas analyzed data from 2010 to 2019 using prescription drug claims from the NAIC Supplemental Health Care Exhibit. They used a difference-in-differences approach to assess the financial impact of both medical and recreational cannabis laws on insurance markets.
The study found that states which legalized recreational marijuana saw a reduction in annual prescription drug claims by $34 to $42 per enrollee in the small group insurance market. The researchers did not observe similar effects in large group insurance plans but found weak evidence suggesting that these reduced claims may translate to slightly lower premiums in small group plans.
These findings add to a growing body of research suggesting that marijuana legalization may offer cost-saving benefits by substituting for certain prescription medications, particularly among populations with more flexible or individualized health plans.
For more information on this study, click here.
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