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A new study from the US says that the adoption of medical cannabis laws may contribute to decreases in healthcare costs.
A new review published in the Journal Applied Health Economics and Health Policy examines health care costs in US states that adopted medical cannabis laws. The authors say there was a “significant” decrease (3.4%) in the average total premium per employee for single coverage plans per year in those states that allow some form of medical cannabis access.
As awareness of the therapeutic potential of cannabis grows, employers must adapt their benefits to reflect this evolving understanding.
Emily Fisher, CEO & founder of Leafwell
The researchers compare these costs with states without state-legal access to medical cannabis, concluding that if all people in all 50 states had legal access to medical cannabis, employers and employees could collectively save billions on healthcare coverage, potentially reducing healthcare expenditure’s contribution to GDP by 0.65% (based on 2022 figures).
The paper estimates that employers and employees could see combined savings of $14.9 billion a year for single coverage plans if all 50 US states had legal access to medical cannabis.
In 2023, the US had around four million people registered to access cannabis for medical purposes across 38 states. The paper speculates there are likely many more than that who are not captured through registration as not all states require it.
Researchers say the impact of these changes on private health insurance costs can be seen just five years after a state’s medical cannabis laws come into effect. The paper argues that one reason for the savings is that cannabis, which is often not covered by insurance providers, is often used instead of medications like opioids that are covered by those insurance plans.
The paper also cites research showing that those who use cannabis are more likely to exercise, that cannabis users have lower BMI, and that cannabis use can lead to less alcohol use.
This study looked at five different outcomes, the total average premium costs per employee for single, family, and employee-plus-one health insurance plans, and the total average deductible costs for single and family health insurance plans.
In addition to the 3.4% decrease in the average total premium per employee for single coverage plans per year in those states that allow some form of medical cannabis access, researchers noted a 2.5% decrease in the average total premium cost for employee-plus-one coverage plans. Other plans did not show a similar decrease.
The four researchers who compiled the paper are all employees of and hold stock or stock options in a company that connects medical cannabis patients to physicians called Leafwell. No Leafwell data were used as part of their analysis.
“Cannabis has been shown to offer significant relief for various conditions, from chronic pain to mental health issues, and ensuring access through insurance can profoundly impact the well-being and productivity of employees,” said Emily Fisher, CEO & founder of Leafwell, in a company press release. “As awareness of the therapeutic potential of cannabis grows, employers must adapt their benefits to reflect this evolving understanding.”
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