The Effects of Prescription Drug Monitoring Programs on the Opioid Abuse Epidemic

Opioid abuse is currently the most significant public health problem in the US. Many US states implemented prescription drug monitoring programs (PDMPs) in response. In this paper, I use a new micro-level medical claims database and I exploit state-level and time-series variations in PDMP implementation to shed light on the impacts of these programs. My results show that PDMPs lead to an overall 14% percent reduction in the odds of abuse/addiction. Also, there is evidence of substantial heterogeneity in impacts, with larger impacts for females and minorities. Another finding is that at least 23% of opioid abuse is a result of drug diversion to nonmedical opioid users. PDMPs were not successful in decreasing the rate of abuse for this group and, in fact, there is some evidence that they increased the diversion to heroin. Finally, I show that PDMPs’ effectiveness varies by type of insurance and that they are more effective in reducing abuse rates in the general population as compared with Medicare Part D. I use my estimates to analyze the potential effects of modifying PDMPs to include giving insurance providers access to electronic databases, providing educational programs for less-educated people, and expanding their “must access” requirement. ∗Department of Economics, University of Pennsylvania. Email: [email protected]. I am grateful to Petra Todd, Michael Sinkinson, Robert Town, and Andrew Shephard for their advice, guidance, and continuous support. I also thank Manvi Bhatnagar, Hanming Fang, Aviv Nevo, Sarah Moshary, and the Penn Economics Empirical Micro Lunch and Seminar participants for their helpful feedback. I gratefully acknowledge the support of the Leonard Davis Institute of Health Economics in accessing the data and technical support throughout the project.