Medicaid programs are at the center of the opioid epidemic. Nearly 12 percent of adults covered by Medicaid have a substance use disorder, including opioid use disorder. Available data suggest that Medicaid beneficiaries are prescribed painkillers at higher rates than non-Medicaid patients and have a higher risk of overdose, from both prescription opioids and illegal versions including heroin and fentanyl. In addition to the human toll, abuse of opioids has significant financial effects. In 2010, Arizona Medicaid paid for more than half of all opioid-related emergency department admissions, and in 2012, 81 percent of the $1.5 billion in nationwide hospital costs related to neonatal abstinence syndrome fell to Medicaid.

To better understand underlying Medicaid prescription opioid utilization, expenditures, and enrollee characteristics, and help inform policies to respond to the crisis, Medicaid and CHIP Payment and Access Commission (MACPAC) looked at Medicaid claims data from calendar year 2010-2012, the most recent year for which such data are available at the national level. We found a small reduction in the number of opioid prescriptions. And newer data from other sources of prescribing and dispensing patterns also show a decline in opioid prescriptions. While these data do not capture illicit use of prescription opioids, continued tracking will help us better understand if policies aimed at inappropriate prescribing are having their desired effect. In the meantime, however, states must contend with the needs of individuals who have already developed an opioid use disorder and the continued increase in overdose deaths.

Medicaid Prescription Opioid Utilization And Spending

In 2012, we found that Medicaid paid more than $500 million for over 34 million claims for opioid drugs, not including expenditures made by managed care organizations (MCOs) on behalf of their members. The total number of claims in both fee-for-service (FFS) and managed care, which capture each instance in which a prescription is filled, decreased between 2010 and 2012, from 35.7 million to 34.3 million, as did prescription opioid claims as a share of all prescription drug claims, from 6.5 percent to 6.1 percent.

Overall, 15 percent of Medicaid enrollees had at least one prescription opioid claim during 2012 (Table 1). Medicaid covers many different low-income populations, including children, pregnant women, working age adults, people with disabilities, and the elderly. Each of these populations utilized opioids to some degree, with enrollees who qualified on the basis of a disability having the highest rates of use. Over one-third (35 percent) of enrollees who qualified on the basis of a disability had at least one opioid claim, compared to about a third of nondisabled adults age 21 to 44 years. Because of Medicaid’s role in providing coverage for persons with disabilities, this is not surprising. But about 20 percent of 19-20 year olds also had at least one opioid prescription.

Opioid use rates and the number of providers and pharmacies used varied considerably by state. Our analysis found that the percentage of Medicaid enrollees with at least one prescription ranged from less than 10 percent to almost a quarter of enrollees across states.

Table 1: Medicaid Opioid Utilization among Disabled and Non-Disabled Populations by Demographics, CY 2012

Notes: Excludes Hawaii, Massachusetts, Nevada, and Pennsylvania due to insufficient managed care pharmacy data. Also excludes individuals dually eligible for Medicare and Medicaid, individuals eligible for partial Medicaid benefits, full-year institutionalized individuals, individuals age 65 and older, individuals with unknown age and/or sex, and individuals with selected cancer diagnoses.

Potential Predictors Of Misuse: Duration Of Use, Multiple Prescribers, And Overlapping Prescriptions

While there are clear clinical indications for opioid use, concerns arise when they are prescribed or used improperly – for example, when multiple opioids are used at once, over a long period of time, at a high dosage, with inadequate clinical oversight, or in combination with benzodiazepines. Likelihood of misuse or addiction increases with longer use or intermittent use over an extended time period. Medicaid programs use a variety of indicators to identify individuals who are potentially misusing prescription opioids. So-called pharmacy shopping, in which an individual fills prescriptions for opioids at multiple pharmacies, can be considered a proxy for potential misuse. Other proxies are the number of unique prescribers of opioids for the same individual within a specified period of time (doctor shopping), or the number of overlapping opioid prescriptions.

These measures do not necessarily indicate misuse, but many states flag these instances for review. Our analysis found that seven out of 10 Medicaid enrollees with an opioid prescription had claims in one or two months during 2012. About half (48 percent) of prescriptions were for short-term use with a day supply of two weeks or less. About one-third of opioid prescriptions were for a month’s supply (22-31 days). Nearly 300,000 enrollees had prescriptions for 12 months. Some individuals with chronic pain may receive prescriptions for a longer period of time, and could thus count towards that number. Of the 6.9 million enrollees with opioid prescriptions in 2012, about 5 percent received prescriptions from five or more prescribers and about 2 percent filled them at five or more pharmacies. About 1 percent of Medicaid opioid users received prescriptions from five or more prescribers and filled prescriptions at five or more pharmacies during the year.

How Medicaid Programs Are Responding

Informed by utilization and expenditure patterns, Medicaid programs are implementing a range of policies to regulate and reduce prescription opioid use. These include:

There has been a decrease in the number of overdose deaths due to methadone prescribed for pain relief. Overall overdose deaths however continue to increase, likely attributable to the increase in more deadly, illicitly manufactured fentanyl. Our data show a slight reduction in the total number of opioid prescriptions between 2011 and 2012. The extent to which state policies noted above played a role in these trends was beyond the scope of our analysis.

Both federal and state Medicaid officials are seeking ways to expand access to evidence-based treatment, in particular to medication-assisted treatment, as well as for co-morbid conditions, such as mental illness or hepatitis C. Medicaid coverage of substance use disorder treatment varies greatly across states. While Medicaid programs are required to cover certain services, such as medically necessary inpatient hospital, outpatient hospital, and physician services, many other services used in substance use disorder treatment are at state discretion, including counseling, licensed clinical social work services, targeted case management, medication management, and peer and recovery supports. Prescription drug coverage is an optional benefit, but all states currently offer it, including coverage for at least one of the medications used to treat opioid use disorder.

Moving Forward

States are tailoring their efforts to expand substance use disorder benefits and the number of enrollees eligible for this care through various mechanisms, including through Section 1115 waivers (e.g., Virginia), the rehab option, and the health homes option (e.g., Vermont). In doing so, individual states face often difficult questions, such as how to best allocate limited state funds, or how to expand treatment capacity when there is an insufficient number of treatment providers. As policymakers contemplate additional ways to stem the continuing epidemic, it is important to recognize that Medicaid programs remain on the front lines — and to consider how to most effectively support individual state responses.