Sometimes if you can justify putting a bigger dollar sign in front of a problem, then you can also justify giving it more attention. This is a useful function of “The Underestimated Cost of theOpioid Crisis,” a report recently published by the Council of Economic Advisers (November 2017).As background, here’s a figure showing the rise in opioid-related deaths–more than doubling in the last decade.

Total deaths from opioid overdoses have climbed very close to the number of deaths from motor vehicle accidents, which totaled over 37,000 in 2016. Here’s the age distribution of the opioid overdose deaths. They are not concentrated among elderly Americans, but rather in the 25-55 age bracket.

As the CEA report points out, the most prominent recent study of this topic in 2016 calculates the costs of opioid problems by measuring the costs of fatalities in terms of lost potential earnings. Thus, the biggest change in the CEA report is to put a monetary value on the deaths. The report notes:

“Among the most recent (and largest) estimates was that produced by Florence et al. (2016), who estimated that prescription opioid overdose, abuse, and dependence in the United States in 2013 cost $78.5 billion. The authors found that 73 percent of this cost was attributed to nonfatal consequences, including healthcare spending, criminal justice costs and lost productivity due to addiction and incarceration. The remaining 27 percent was attributed to fatality costs consisting almost entirely of lost potential earnings. … Using conventional estimates of the losses induced by fatality routinely used by Federal agencies, in addition to making other adjustments related to illicit opioids, more recent data, and underreporting of opioids in drug overdose death certificates, CEA finds that the overall loss imposed by the crisis is several times larger than previous estimates.”

Putting a monetary value on the loss of life is of course a vexed business. For previous discussions on this website of the “value of a statistical life,” see “Value of a Statistical Life? $9.1 Million” (October 22, 2013) and “The Origins of the Value of a Statistical Life Concept” (November 25, 2014). The CEA report gives a quick overview of the academic literature on this point, and also on what numbers are actually used by government agencies: