The opioid epidemic in 2015 cost the US economy more than $500 billion, according to a new report by the White House Council of Economic Advisers (CEA).
The CEA analysis concluded that the opioid epidemic in 2015 cost between $293.9 billion and $622.1 billion, with a preferred estimate of $504 billion. That amounts to multiple times what previous studies found, in part because the death toll from the crisis has grown and in part because the White House is using different methodology to try to include the broader societal costs of premature death.
The estimate is probably low for 2016, given that drug and opioid overdose deaths spiked last year compared to 2015 — in large part due to the spread of the synthetic opioid fentanyl in the illicit market. But it shows that the opioid epidemic is putting a massive strain on various aspects of American life, including health care, the criminal justice system, and families’ potential lifetime earnings and contributions to society.
Based on the CEA’s findings, the total cost is also much higher than previous research has suggested. A 2016 study published in Medical Care estimated the total economic burden of prescription opioid overdose, misuse, and addiction at $78.5 billion in 2013. And a more recent report published by Altarum, a health care research organization, put the cost of the opioid epidemic at $95 billion for 2016.
The CEA argued that “previous estimates of the economic cost of the opioid crisis greatly understate it by undervaluing the most important component of the loss — fatalities resulting from overdoses.” The CEA said that previous estimates look at a narrow set of costs, such as health care expenses and lost potential earnings from work, instead of the full value of all the activities that people could contribute to if they didn’t die prematurely. So it leveraged “conventional estimates” typically used by other federal agencies to get a fuller picture.
Corey Rhyan, a health care research analyst at Altarum who was not involved with the CEA report, said that neither the White House’s estimate nor his own report’s estimate is necessarily more accurate, but that each is trying to get at different questions.
“Our [Altarum] report is looking at the direct estimate of the return you would see in economic benefits if you could remediate this epidemic — the potential economic benefits, the true dollar values that you would see over someone’s lifetime as a result of someone’s increased earnings,” he said. “What the White House produced is the total societal welfare loss associated with the opioid epidemic, which includes the implicit value of life because they’re trying to put a value on [the fact] we care more about people than just what their economic gains are going to be throughout their lifetimes.”
Regardless, the cost is very high — from the tens of billions to hundreds of billions of dollars. So even a large investment to address the opioid crisis, such as the tens of billions that experts argue is necessary to boost addiction treatment and harm reduction efforts, could prevent even more in costs down the line.
The current overdose crisis has over time changed to involve all kinds of opioids — painkillers, heroin, and fentanyl. But it originally began with the overprescription of opioid painkillers, which caused the supply of the prescription drugs to explode. That led opioids to proliferate, landing in the hands of not just patients but also teens rummaging through their parents’ medicine cabinets, other family members, friends of patients, and the black market. As people got addicted, some moved on to heroin and fentanyl. Meanwhile, the expanding supply of heroin and fentanyl — which came into the US to meet demand by new opioid users — allowed more people to easily obtain the drugs, even if they didn’t start on painkillers.
That’s culminated in a crisis that has killed tens of thousands of people annually for years — a horrific loss of life, and one with huge repercussions for the US economy.
In October, President Donald Trump declared the opioid epidemic a public health emergency. But so far, the current White House and Congress have not dedicated significant new funding to deal with the crisis.
For more on the opioid epidemic, read Vox’s explainer.