Association for Public Policy Analysis & Management

In 2015, about as many Americans died from drug poisoning involving opioid analgesics or heroin as from motor vehicle-related injuries. Between 2013 and 2015, the rate of deaths from opioid overdose increased by almost 40% from 5.1 to 7.0 per 100,000 while the rate of deaths involving heroin grew by more than 50% from 2.7 to 4.1 per 100,000.

In 2015, Medicaid covered 3 in 10 people with opioid addiction and thus played an essential and growing role in addressing the epidemic. "Medicaid facilitates access to a number of addiction treatment services, including medications delivered as part of medication-assisted treatment, and it allows many people with opioid addiction to obtain treatment for other health conditions." The expansion of eligibility for Medicaid coverage by many states as part of the implementation of the Affordable Care Act in 2014 made addiction treatment more affordable for previously uninsured low-income individuals. Absent any change in behavior on the part of Medicaid enrollees, greater availability of treatment for opioid use disorder would, therefore, be expected to curb the growth in the frequency of inpatient and emergency department visits and the death rate due to an opioid drug overdose.

At the same time, the Medicaid expansions may have made it easier and cheaper for previously uninsured individuals to access not just addiction treatment medication, such as buprenorphine, but also to the very drugs that trigger and sustain the addiction in the first place. By improving access to prescription opioids, to addiction treatment, and to more comprehensive care for co-morbid conditions associated with the addiction, it is possible that the Medicaid expansions reduced the cost of opioid addiction borne by newly insured enrollees. A reduction in the addiction's cost would be expected to erode the deterrent effect of the addiction's harmful health effects and thus accelerate the growth in the frequency of inpatient and emergency department visits and the death rate due to an opioid drug overdose.

We employ a difference-in-difference framework to study the effect of the recent Medicaid expansion on opioid prescriptions, opioid-related hospital visits, and mortality. We utilize the State Drug Utilization Data which contains opioid prescriptions reimbursed by Medicaid, Healthcare Cost and Utilization Project (HCUP) for ED and inpatient visits by Medicaid enrollees, and the National Vital Statistics System for mortality. Our findings indicate that overall the number of opioid prescriptions to Medicaid patients increases. In addition, synthetic opioid overdoses deaths increased in expansion states relative to non-expansion states. This effect is entirely driven by expansion states that are on the east side of Mississippi River. These states have also shown an increasing trend in deaths from heroin overdoses relative to non-expansion states well before the policy was implemented. This might suggest that some of those who were heroin users in the past might have turned to the prescription drugs after the expansion of Medicaid. Opioid-related ED and inpatient visits also increased in the expansion states relative to non-expansion states.