According to a new report by the President’s Council of Economic Advisers (CEA), the opioid crisis costed the American economy nearly half a trillion dollars in 2015 alone.
The cost associated with opioid addiction ate up nearly 2.8% of GDP in 2015, nearly 6 times an amount previously estimated by the Obama Administration. With well over 30,000 lives lost to opioid abuse, and countless others irreparably ruined, the CEA says that their estimates of its impact are conservative.
President Trump declared the opioid epidemic a public health crisis in October, as opioid abuse rose to the #1 cause of overdose deaths in 2016, as well as the leading cause of death of Americans under 50.
Previous analysis of the epidemic’s economic impact had failed to take these death rates into account. Those older analyses, the CEA noted, had focused more narrowly on the costs of opioid abuse to the health-care system, or added to that number costs in lost earnings or to the criminal justice system. The most recent study found a total cost of $78.5 billion.
The new report, however, takes another advantage of a commonly used economic tool, the value of statistical life (VSL), to estimate the costs of the opioid epidemic based on the number of fatalities it has incurred. Using that particular approach, the report finds an estimated cost of opioid fatalities alone to be between $220 billion and $549 billion. On top of that range, the CEA factors in estimates of non-fatality related costs—about $70 billion—to reach the $500 billion estimate.
The report also compensates for what it had suggested as a chronic underreporting of opioid overdose deaths: one study had suggested that in 2014 opioid-induced deaths were almost 24% higher than they were initially reported.
These already high costs are more likely to increase only, in the coming years. Opioid-related deaths surged in 2016, thanks in large part to the highly potent opioid fentanyl. The Drug Enforcement Administration has recently taken steps to curb the importation of analogues of that drug. Things do not appear to be getting any better in 2017: a top CDC official had called the crisis “one of the few public health problems that is getting worse instead of better” in October this year.