Marijuana legalization and disability claiming

Area of Science:

• Public Health
• Health Economics
• Social Policy

Background:

• Recent legalization of recreational marijuana use laws (RMLs) in the United States presents a novel policy change with potential socioeconomic impacts.
• Understanding the effects of RMLs on disability insurance programs is crucial for policy evaluation and resource allocation.

Purpose of the Study:

• To investigate the impact of RML adoption on new applications and allowances for Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI).
• To analyze trends in disability benefit applications and approvals in relation to state-level RML implementation.

Main Methods:

• Utilized administrative caseload data from the Social Security Administration spanning 2001-2019.
• Employed two-way fixed-effects models to combine caseload data with state policy changes.
• Analyzed the relationship between RML adoption and changes in SSDI/SSI applications and allowances.

Main Results:

• RML adoption was associated with a significant increase in applications for both SSDI and SSI.
• No statistically significant change in the allowance rates for SSDI or SSI was observed following RML adoption.
• Suggestive evidence indicates that increased marijuana misuse, selective migration, and decreased unemployment may drive the rise in applications post-RML.

Conclusions:

• RMLs appear to influence the decision to apply for disability benefits, potentially due to increased marijuana misuse and shifts in employment.
• The findings suggest that while RMLs may increase application rates, they do not directly impact the approval criteria or outcomes for disability insurance.
• Further research is warranted to fully elucidate the causal pathways linking RMLs to disability benefit claims and to understand the role of socioeconomic factors.