State laws that limit the amount of opioid prescriptions on the supply side of the market are a more effective way of tackling the US opioid epidemic than targeting demand for the pain-relieving drugs.
Nevertheless, policies to restrict the availability of legally dispensed prescription opioids have important indirect effects, as they are associated with higher drug-related crime rates. These effects occur especially in parts of the country with poorer health insurance coverage and lower socio-economic status.
These are among the findings of new research by Claudio Deiana and Ludovica Giua, to be presented at the Royal Economic Society's annual conference at the University of Warwick in April 2019. Their study analyses the impact of two supply-side laws, a demand-side law and two laws concerning opioid-related mortality on the volume of opioids prescribed, as well as on drug-related crime.
In recent decades, the United States has been struggling with the so-called opioid crisis. According to the Centres for Disease Control and Prevention (CDC), drug overdose deaths across the country have increased five-fold since 1999. This unprecedented epidemic, which mainly involves the abuse of opioids, led to over 63,000 victims in 2016 only.
In response to the opioid crisis, US states have adopted several policies to curb the abuse of prescription drugs and overdose mortality. Some state laws aim to reduce the amount of prescription opioids sold either on the supply side or the demand side of the market, depending on whether they impose restrictions on prescribers or patients, respectively.
Other laws have been designed to contain the number of fatal overdoses by providing incentives to abusers to seek medical assistance in case of an overdose emergency.
The new study shows that laws targeting the supply for opioids yield larger reductions in the quantity of per capita opioid-based substances dispensed compared with demand-side policies, especially in areas with better health insurance coverage and higher socio-economic status. Their enforcement, however, is also associated with an increase in drug-related arrest rates.
The study considers two supply-side regulations:
- Prescription Drug Monitoring Programs (PDMPs), which consist of state-level systems allowing physicians and pharmacists to view a patient's prescribing history of controlled substances.
- Pain Management Clinics Laws (PMCLs) which set the minimum requirements for pain management clinics to be allowed to dispense prescription drugs.
A demand-side law:
- Doctor Shopping Laws, which oblige patients to reveal to their prescriber any previous prescriptions received from other doctors and prohibit obtaining drugs through fraud or deceit.
And two laws concerning opioid-related mortality:
- Good Samaritan Laws, which grant immunity from prosecution or mitigation in sentence for drug-related crimes to people who call 911 in the case of an overdose emergency.
- Naloxone Access Laws, which provide immunity to healthcare professionals who prescribe or administer naloxone without authorisation to reverse an opioid overdose in case of emergency.
The study shows that implementation of the supply-side PDMPs and PMCLs regulations yields an overall 4% and 15% reduction in per capita prescription opioids dispensed at the county level, respectively. This result is more pronounced in counties with larger shares of people of high socio-economic background.
In contrast, laws regulating the demand for drugs do not produce any appreciable statistical impact, possibly due to weak implementation. The same is true of laws aimed at reducing opioid-related mortality, which lower the opportunity costs associated with drug abuse.
Although their intended purpose is to reduce the abuse of prescription drugs and overdose mortality, these interventions indirectly affect other relevant dimensions of local economies, such as drug-related crime rates.
The results of the study suggest that the implementation of PMCLs, in particular, leads to a significant increase in the reported incidence of opium-based drug crimes, especially in poorer counties.
While opioid state laws can reduce overall abuse, it is possible that heavy users turn to the black market in response to the lower availability of legally prescribed drugs.
These results have important policy implications:
- First, state laws enacted to limit the amount of opioid prescriptions on the supply side of the market appear to be more effective in reducing the quantity of prescription opioids distributed than those targeting the demand for drugs.
- Second, policies that restrict the availability of legally dispensed prescription opioids can have important unintended consequences on the market for illicit substances.