Economic Impact of Alcohol Abuse in the US

How Alcoholism and Binge Drinking Hits All of Our Wallets

Man Counting Cash in Wallet

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Alcohol misuse and dependence claim an estimated 95,000 lives each year in the United States, but the cost to society doesn't stop there. Heavy drinking takes its toll on society as a whole, costing industry, the government, and the U.S. taxpayer an estimated at $249 billion each year, according to a report from the Atlanta-based Centers for Disease Control and Prevention (CDC).

The societal costs of alcohol misuse averages to around $807 per citizen or roughly $2.05 per drink.

Government and Taxpayers Bear the Burden

The CDC report, published in 2015, concluded that two out of every $5 of these costs (or an estimated $100.7 billion) were picked up federal and state governments. Three-quarters (or $191 billion) were attributed to binge drinking.

Underage drinking further represented $24.3 billion of these costs, while drinking during pregnancy accounted for an additional $5.5 billion.

According to the researchers, the costs were mainly associated with losses in workplace productivity, followed by direct and indirect costs to the healthcare system.

Alcohol Costs by State

Breaking down the regional impact of alcohol abuse, the median cost per state was roughly $3.5 billion. Binge drinking was responsible for more than 70% of these costs, 40% of which was covered by the federal government.

The costs to states ranged from a low of $488 million in North Dakota to a high of $35 billion in California. Washington, D.C. had the highest per capita costs overall at $1,526, nearly twice the national average.

In terms of per-drink costs, the highest numbers were seen in New Mexico at $2.77, a figure that was 35% higher than the national average.

Amounts Are Believed Underestimated

The CDC believes that the $249 billion in annual costs is largely underestimated, in part because many injuries and alcohol-related health problems remain either reported or undiagnosed. Moreover, many of the workplace losses—such as those related to absenteeism—cannot be measured directly, making it difficult to place a dollar value on such losses.

To complicate matters even further, the $249 billion in alcohol-related expenses do not include $193 billion lost to illicit drug use, a figure described in the Surgeon General's 2016 Report on Alcohol, Drugs, and Health. Since people can use alcohol and drugs at the same time, some of the $193 billion attributed to drug use may be partially caused by alcohol.

Strategies for Reducing Binge Drinking

The quickest way to reduce these costs, says the CDC, would be to reduce binge drinking (defined as four or more drinks per occasion for women or five or more for men).

To this end, the researchers suggested using several evidence-based strategies to reduce the impact of drinking on society:

  • Increasing the price of alcohol to discourage use, particularly among the young
  • Regulating the number and location of sites where alcohol is sold
  • Holding alcohol retailers liable for injuries or damages caused by intoxicated or underage customers
  • Avoiding the commercialization of state-controlled alcohol sales

While many of the suggestions would meet stiff opposition from government and industry, they do highlight that cost and access remain major drivers of widespread alcohol misuse in the U.S. Unless measures are taken to actively discourage drinking, says the CDC, it will be society at large that will end up paying.

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3 Sources
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  1. Centers for Disease Control and Prevention. Excessive drinking is draining the U.S. economy. Updated December 30, 2019.

  2. Sacks JJ, Gonzales KR, Bouchery EE, Tomedi LE, Brewer RD. 2010 national and state costs of excessive alcohol consumption. Am J Prev Med. 2015;49(5):e73-e79.doi:10.1016/j.amepre.2015.05.031

  3. U.S. Department of Health and Human Services (HHS), Office of the Surgeon General. Facing Addiction in America: The Surgeon General's Report on Alcohol, Drugs, and Health. Washington, DC: HHS. Published November 2016.