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The ongoing opioid crisis cost $696 billion in 2018 and more than $2.5 trillion between 2015 and 2018, according to a new estimate by the White House Council of Economic Advisers.
Why it matters: Much of this cost is attributable to lives lost to opioids, but a good amount of it is borne by state and federal governments — and thus taxpayers. Meanwhile, opioid litigation settlement talks are homing in on payouts nowhere near this amount.
For context: $696 billion was 3.4% of GDP last year — an astronomical amount.
- The estimate is much higher than a recent report by the Society of Actuaries because of the way CEA calculated the value of a life.
- It also includes health care and substance abuse treatment costs, criminal justice costs and reduced productivity costs.
- "Under CEA’s calculation, the majority of the costs are 'paid' by those who lost their lives," special advisor Jared Meyer said.
The big picture: The drug manufacturers and distributors being sued by thousands of communities struck a deal last week with the plaintiffs that kept the first federal opioids trial from beginning as scheduled. But a larger deal to settle all of the pending lawsuits has yet to be reached.
- Some state attorneys general have announced a settlement framework worth $48 billion, but nothing is final.
- Congress gave $6 billion in new opioid funding in 2018 and 2019, per CEA.
What they're saying: Andrew Kolodny of Brandeis University said that at least some of the plaintiffs have the resources to pay much more to help addressing the epidemic they've been accused of creating.
- "The distributors and Johnson & Johnson have extremely deep pockets," he added. “Considering the cost of the mess they created and the estimate that comes from the White House Counsel of Economic Advisors, $48 billion is way too little.”
The bottom line: "We’re all paying for this," Kolodny said. "We’re paying an enormous price, both in terms of economic and human costs.”