Thursday, September 22, 2022

The Opioid Crisis and Personal Finance

I recently participated in a panel discussion about America’s opioid crisis at a professional conference. My role on the panel was to discuss the financial implications of the opioid crisis on individuals, families, and the country. Other speakers delved into the extent of the opioid epidemic and its impact on relationships and physical and mental health.

Below are my take-aways from the conference presentation:

Staggering numbers- According to various U.S. Department of Health and Human Services reports, 10.1 million people misused prescription opioids during the past year, 1.6 million had an opioid use disorder, and 50,000 used heroin for the first time. In addition, there were 48,006 deaths attributed to overdosing on synthetic opioids and 14,480 deaths attributed to overdosing on heroin.

Risk Factors- Factors associated with opioid misuse and use disorders include a family history of substance abuse, a personal history of substance or tobacco use, a history of preadolescent sexual abuse, mental health issues like depression (opioids may be misused for their mood-altering properties), and demographic factors (e.g., primarily young males).

How Opioids Get Misused- Pathways to substance abuse include prescriptions by doctors, using another person’s prescription, obtaining prescriptions from multiple doctors, stealing drugs from family and friends, and accessing drugs that are not stored in a secure, locked location. Every day, 2,000 teens in the U.S. try prescription drugs for the first time.

Opioid “Rush” Sensation- During an overdose, oxygen supply to the brain is limited due to lowered breathing and a lowered heart rate. Opioid receptors in the brain and body are flooded which causes a euphoric “high” feeling. The opioid user typically gets sleepy due to shallow breathing. Brain damage or death can occur if Narcan (an emergency treatment medicine designed to reverse an opioid overdose) is not administered promptly.

Health Impacts- People with an opioid dependence are 11.2x more likely than others to have had at least one mental health outpatient visit and 12.2x more likely to have had at least one hospital inpatient stay. In addition, they are at greater risk for Hepatitis A, B, or C and for developing a psychiatric illness and for pancreatitis. Opioid use during pregnancy results in exposure of babies to the harmful effects of these drugs.

Psychosocial Impacts- In addition to health impacts such as mental confusion, depression, nausea, and constipation, other impacts include the destruction of families, low educational achievement, unemployment, homelessness, increased crime and fatalities due to motor vehicle accidents, increased transmission of disease (e.g., HIV and hepatitis), and increased healthcare costs.

Global Financial Costs- Opioid abuse is estimated to cost the U.S. $33 billion a year in health care costs and $14.8 billion annually in criminal justice costs. The largest cost, however, is $92 billion in lost productivity and earnings, which includes losses due to premature death of a worker due to an overdose, lost productive hours, and opioid-related incarceration. The costs of opioid addiction affect individuals and families, employers (e.g., absenteeism, presenteeism, labor shortages, disability payments, and costs of errors made by impaired workers), and governments (e.g., criminal justice and incarceration expenses and reduced income tax and FICA tax revenue).

Individual/Family Costs- Listed below are impacts experienced by individuals and families affected by opioid addiction:

        Decreased labor force participation

        Incarceration for opioid-related crimes

        Depleting savings to pay for a drug addiction

        Forgone saving/investment opportunities (e.g., 401(k)s, IRAs)

        Out-of-pocket health care expenses

        Poor credit history due to delayed bill-paying

        Lost lifetime earnings due to unemployment and premature death

        Grandparents raising grandchildren (impact on retirees)


Financial Action Steps- The objective here is to prevent an opioid user’s access to cash with which to buy drugs. Third party monitoring of financial accounts is often recommended, and preparation of estate planning documents is essential. Other suggested financial management strategies include the following: 

        Close joint bank and credit accounts

        Turn over credit and debit cards to a sober family member (i.e., pay for things cash-only)

        Cut off online access to financial accounts

        Direct deposit of paychecks and direct bill payment

        Text alerts (e.g., late payments and account withdrawals) to a sober family member

For additional information about the cost of opioid abuse, review this colorful infographic.

This post provides general personal finance or consumer decision-making information and does not address all the variables that apply to an individual’s unique situation. It does not endorse specific products or services and should not be construed as legal or financial advice. If professional assistance is required, the services of a competent professional should be sought.


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