Joel Segel, Ph.D.Assistant ProfessorDepartment of Health Policy and AdministrationThe Pennsylvania State UniversityUniversity Park, PA 16802

Billions in Tax Revenue Lost Due to Misuse of Opioids Interview with:

Joel Segel, Ph.D.Assistant ProfessorDepartment of Health Policy and AdministrationThe Pennsylvania State UniversityUniversity Park, PA 16802

Dr. Segel

Joel E. Segel, Ph.D.
Assistant Professor
Department of Health Policy and Administration
The Pennsylvania State University
University Park, PA 16802 What is the background for this study? What are the main findings? 

Response: Earlier research has shown that the societal costs of opioid misuse are high, including the impact on employment. However, previous work to understand the costs of opioid misuse borne by state and federal governments has largely focused on medical costs such as care related to overdoses and the cost of treating opioid use disorder.

Our main findings are that when individuals who misuse opioids are unable to work, state and federal governments may bear significant costs in the form of lost income and sales tax revenue. We estimate that between 2000 and 2016, state governments lost $11.8 billion in tax revenue and the federal government lost $26.0 billion. What should readers take away from your report?

Response: When considering the cost of the opioid epidemic to both state and federal governments it is important to consider all costs not just medical costs. One previously underappreciated cost is tax revenue lost as a result of the effect of opioid misuse on the labor market. On lost tax revenue alone, our estimates show states may have lost $11.8 billion and the federal government may have lost $26.0 billion more than was previously estimated. What recommendations do you have for future research as a result of this work? 

Response: One major potential area of future research is understanding how opioid use disorder treatment, including medication assisted treatment, may improve both individuals’ health as well as employment outcomes. As states and local governments implement innovative treatment programs, an important consideration is how these programs not only improve the health of their patients but help them re-enter the labor force. This may have implications

Furthermore, as opioid misuse affects individuals and their families on a number of different dimensions such as use of medical care, employment, use of social services, and the criminal justice system among others it is important to understand both the full breadth of costs to the state as well as how treatment programs may improve health and help to offset some of these costs. Is there anything else you would like to add? 

Response: The project was funded by the Commonwealth of Pennsylvania under the project “Estimation of Societal Costs to States Due to the Opioid Epidemic”. 


Joel E. Segel, Yunfeng Shi, John R. Moran, Dennis P. Scanlon. Revenue Losses to State and Federal Government From Opioid-related Employment Reductions. Medical Care, 2019; 1 DOI: 1097/MLR.0000000000001107 

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Apr 16, 2019 @ 12:25 am

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