By MICHAEL C. PATTERSON
The Marijuana Business Factbook, provided by Marijuana Business Daily, has recently projected that the U.S. Cannabis market (medical and adult use cannabis) will exceed $36 Billion in sales by 2024. This overwhelming acceptance by the American public is changing the US healthcare system in unexpected ways.
In 2019, the USA sold approximately $13.6 Billion in legal cannabis ($7.6 Billion- Adult Use, $6.0 Billion Medical Use). Cannabis sales continue to increase 30 percent per year on average across the country. With over 90 percent of Americans approving medical cannabis use and 67 percent approving adult use (recreational use), legal cannabis in our society is here to stay. In Florida, medical cannabis sales are projected to surpass over $1 Billion in 2020 with over 350,000 qualified medical cannabis patients as of July 2020, and patient counts steadily rising 3,000-5,000 per week.
With the continued increase in use and acceptance of cannabis, how is this currently affecting America’s healthcare system and what effect will cannabis have on the future of healthcare?
- The sky is not falling
Prior to legalization, the prohibitionists attempted to squash legalization at every turn. Their most common tactic was turning to physicians and medical experts to publicly state that cannabis will be the downfall of our society. That people will become addicted at very high rates, crime will increase and overdose deaths from cannabis will become an epidemic.
In reality, the exact opposite is happening. No human has ever died from cannabis (in any form) in human history, which makes cannabis one of the safest medicines, if not the safest, on the planet. To put that figure of ZERO deaths in perspective, people die every year from water intoxication (drinking too much water). Furthermore, studies are beginning to demonstrate patients who use cannabis as a medicine decrease the use of two to three prescription drugs per month because they don’t need them anymore. Cannabis decreases inflammation at the cellular level across the body, which can decrease pain and keep the body closer to a homeostatic state.
- Senior Citizens are the fastest growing demographic of cannabis users On average, persons over 65 years old in the USA take 13 prescription medications per day. I have seen from first-hand experience that Seniors are tired of taking so many medications and dealing with a barrage of side effects from constipation, nausea, headache, fatigue, decrease in immune response, and more. As more Seniors are recommended medical cannabis, they see the benefits of its use and they tell their friends. As more Seniors continue to use cannabis as a medicine and have a positive experience, the acceptance of medicinal cannabis will continue to accelerate.
Furthermore, as adult use cannabis becomes legal in more states, more Seniors will be by-passing their physician and going directly to the cannabis dispensary in an attempt to self-medicate. Health care companies will need to acknowledge cannabis as a medicine and begin to look at recommending medicinal cannabis or eventually incorporating adult use cannabis into a treatment regimen (similar to using vitamins or nutritional supplements) in order to maintain or increase current patient services and revenue.
- Big Pharma is on the sidelines, but ready to get into the game
Big Pharma companies are already involved in the global cannabis industry. Companies are performing research on cannabis (where legal) and studying current cannabis companies in the market. As the US moves toward legalization of cannabis, innovation will increase dramatically. You will see more interest and money flowing into the cannabis industry for R & D of the cannabis and hemp plant, the development and study of minor cannabinoids (CBG, CBN, THCA, THCV, etc.) for medicinal use, and the development of patented cannabis formulations which have proprietary blends of cannabinoids for a specific medical purpose. Also, there will be an increase in the use of non-euphoric cannabinoid formulations to be used as nutritional supplements (similar to fish oil, krill oil, resveratrol, and other natural supplements).
- Insurance companies are already looking into how to reimburse cannabis as a medicine
Once cannabis goes legal at the federal level, federal insurance programs (Medicare, Medicaid) will begin paying for cannabis. This will lead to private insurance companies paying for medical cannabis as well (if it comes from a physician script). The FDA has already begun to study the Canadian market to see how Canada is covering medical cannabis prescriptions. In regard to insurance payment of cannabis medicine, it is different than any other medicine that has come before. There will have to be a lot of issues worked out to pay for cannabis via insurance due to the many forms of cannabis (flower, edibles, oil-based medicine, tinctures, spray, patch, etc.), implementing cannabis into the current CPT code payment system, and payment amounts per gram of product.
- Healthcare companies who begin to embrace all types of cannabis (medical and adult use) will be rewarded with more patients and more revenue
Cannabis is already becoming a value-add service to many physician group practices. Cannabis physician recommendations have the ability to offer a new private pay revenue stream for a physician practice that did not exist before. This new service has the potential to bring in new patients for cannabis related recommendations, but also offering traditional healthcare services (lab, x-ray, general medicine, consultation, etc.). Also, cannabis patients who have a very pleasant experience with their recommending physician, are more likely to recommend other patients to their physician. The physicians that I personally know who write medical cannabis recommendations tell me that over 75 percent of their new patient referrals come from existing patients.
Furthermore, in adult use cannabis states, 40 percent of people using adult use cannabis are using it for medical reasons (sleep and chronic pain are the most common reasons for use). Therefore, many of the patients who are coming into the health care facilities are already using cannabis as a medicine, and not telling their physician. Healthcare groups that open up a mutual dialogue of education and respect for the cannabis plant as a medicine, will be able to offer “wellness services” related to adult use cannabis as a form of a supplement for wellness.
As I have seen for years in the cannabis industry, one of the most difficult issues for users is figuring out proper dosage of cannabis for each individual patient. Since our bodies have an endocannabinoid system (ECS) each person processes cannabis at different rates. This does not allow for consistent dosing across an entire population. The ECS creates a tremendous opportunity for physicians to educate and offer paid services which will assist patients in determining their best cannabis dose and delivery method (flower, edible, oil, vapor, etc.) to provide the most relief with the least amount of side effects.
One of the most consistent things in life is change. Cannabis is leading the charge in the healthcare world as being one of the biggest changes to modern healthcare in a generation. The healthcare companies who embrace this change will ultimately be more successful than companies that refuse to acknowledge that cannabis used as a medicine has gone mainstream and is here to stay.
Michael C. Patterson, founder and CEO of U.S. Cannabis Pharmaceutical Research & Development of Melbourne, is a consultant for the development of the medical marijuana industry nationwide and in Florida. He serves as a consultant to Gerson Lehrman Group, New York and helps educate GLG partners on specific investment strategies and public policy regarding Medical Marijuana in the U.S. and Internationally. He can be reached at mpatterson@uscprd.com
