Does Medicare increase opioid drug usage? A regression discontinuity study.
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Law, Alexander J., 1996-
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Recently, the overuse of opioid medications in the United States has garnered national attention, spurring many leaders to declare it a national epidemic. Medicare Part D provides prescription drug coverage for various medications including opioid drugs. The problem of moral hazard in insurance predicts that services the insurance covers will be overused because of the covered risk and financial burden. With Medicare, I find no statistically significant increase in opioid usage from the age threshold for Medicare eligibility. Because insurance choice is endogeneous, I use age as the running variable for a sharp regression discontinuity design, where a dummy variable for the eligibility threshold is used to indicate Medicare eligibility. Any statistically significant results from various combinations of covariates disappear when the age bandwidths are narrowed, and similarly, there is no effect with individual drug dosage.