Would Taxing Opioids Solve Our Overdose Problem?

Louisville, Kentucky and an avalanche of pills.

It’s pretty universal: Everyone wants to combat the epidemic of opioid misuse that killed nearly 64,000 Americans in 2016. Opinions on the right way to do this job vary greatly. Currently, some state legislatures are considering measures that would tax prescription opioids by the dose as a tactic to reduce misuse and overdoses. The state closest to enacting this measure is the State of Kentucky.

At the moment, the Kentucky Legislature is processing a budget that includes a provision for a $.25 tax on every dose of opioid medication brought into the state. The tax would be levied on pharmaceutical distributors, not manufacturers, doctors, pharmacists or patients. But historically, a tax on one phase of a manufacturing or supply system is passed on to the consumer one way or another. It could be a surcharge or a processing fee or some other way of attaching a charge to the final user. As it’s worded now, the provision in the budget does not prohibit passing this charge on to the patient purchasing the medication.

How Much Money Would be Raised and Who Would Benefit?

If this budget with the tax on opioids is approved, where would those funds go? In 2017, there were 303 million doses of pharmaceutical opioids delivered to the State of Kentucky. (Please note that there are only 4.4 million residents in the state, meaning that there were enough opioids for each resident to receive 68 pills.) If this tax had been levied in 2017, the sum raised would have exceeded $75 million.

Pill bottles and pills

According to the provision in the budget, what would this money be used for? It depends on who you ask. Some news sources say that this money would be used to fill gaps in the state’s budget, including increasing funding for public schools. The Lexington Herald-Leader simply says the funds will go into the state’s General Fund which is used for government programs.

There is another bill sponsored by Kentucky Representative James Kay, that also wants to impose this $.25 per-dose tax but directs the funds to cover the state’s employee pension deficit.

Why aren’t any Kentucky legislators insisting that funds raised by this tax go to drug rehabilitation or drug prevention activities in schools?

Similar Bills in Other Legislatures

At least thirteen states have considered similar legislation, with some of those states mandating that the money is used to directly address the opioid problem through treatment and prevention. In some states, such as California and Minnesota, the proposed tax was one cent per milligram. At the moment, no other state is as close to implementing this tax as Kentucky is.

There’s even a federal bill, S.523 in the 115th Congress, that calls for the one cent per milligram tax be used for treatment programs, as well as recruiting and training addiction professionals to work in rural and underserved areas. It is sponsored by Senator Joe Manchin of West Virginia.

Possible Effects of these Bills

On the plus side of things, the tax could discourage pharmaceutical distributors from shipping as many pills into Kentucky. On the minus side, if the cost is passed along to the patient, the people who will suffer needlessly are chronic pain patients who rely on opioids to give them an acceptable quality of life.

A doctor hands out pills.

But there’s another, more insidious effect that could be created by this legislation. There are millions of Americans misusing and addicted to these painkillers. There are millions of chronic pain patients who are dependent—meaning their bodies are accustomed to the drug but they are not misusing it. They have no other solution for their pain than the prescriptions they get from their doctors. Both these groups could be driven to the illicit market to get opioids if their pills become unavailable or too expensive.

As noted by the medical news website StatNews, heroin and fentanyl are increasingly responsible for American overdose deaths, compared to prescription opioids. Legislative manipulation of this supply without correcting the causes of dependence or addiction could have the effect of worsening an already-bad situation.


Karen Hadley

For more than a decade, Karen has been researching and writing about drug trafficking, drug abuse, addiction and recovery. She has also studied and written about policy issues related to drug treatment.