A new study in the International Journal of Drug Policy found that states with legal medical marijuana enjoyed significant reductions in health insurance premiums compared to states where cannabis remained completely illegal.
Analyzing a decade’s worth of private health insurance data from the National Association of Insurance Commissioners, researchers determined that in the years following a state’s implementation of a medical cannabis law, premiums dropped dramatically.
While the reductions were modest immediately following implementation, the study found that by seven years afterward, annual premiums had fallen $1,663 compared to states in the control group. Similar reductions were seen after eight years ($1,542) and nine years ($1,626), indicating that the decline was fairly stable over time.
“Although the effect does not begin until seven years post-medical cannabis law implementation,” the authors conclude, “there is a significant and sizable reduction in health insurance premiums” in states that legalize medical marijuana.
“Due to the nature of insurance pooling and community rating,” they add, “these savings are appreciated by cannabis users and non-users alike.”
As the study’s authors point out, the findings undermine concerns that legalization would risk increasing healthcare costs. “Initial concerns about medical cannabis legalization leading to increases in medical care costs, which would be reflected in higher insurance premiums, appear to be unfounded,” they wrote.
Researchers were specifically looking at individual private health plans rather than employer-sponsored insurance plans or Medicaid. The study notes that health insurance spending in the U.S. accounts for between 16 percent and 34 percent of the average household budget.
In an attempt to control for other variables, authors focused on states where only medical marijuana was legal, excluding from the analysis states where adult-use legalization was already in effect. States in the control group, meanwhile, included those without medical cannabis or those that had passed but not yet implemented a such a policy
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