October 18, 2023

States that have legalized cannabis for medical use report significant reductions in private health insurance premiums according to a recent study published in the Journal of International Drug Policy. The study found sustained reductions in annual premiums of as much as $1,663 per year compared to demographically similar states without any form of cannabis legalization based upon analysis of healthcare data spanning 2010-2021.

Previous studies that suggest medical cannabis can impact insurance premiums by broadening treatment options for mental health conditions, chronic pain, and nausea, potentially reducing crime, reducing the need for rehabilitative services to treat substance use disorders, decreasing hospital admission rates, and reducing prescription drug costs by substituting more addictive prescription drugs with medical cannabis. according to the authors.

This decline in private health insurance premiums follows a similar trend as prescription costs for Medicare and Medicaid have also declined in states with both medical-use only and adult-use cannabis laws. This is an important trend to watch as some states like New York passed a law to require medical cannabis doctor visits to be covered by state-run insurance programs and authorized private insurers to do the same.