Alcohol, drugs cost Alaska economy $3 billion a year

The total costs from alcohol and drug abuse and dependence in Alaska are more than $3 billion per year, according to a new Alaska Mental Health Trust report completed by the McDowell Group.

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That amount is equal to roughly $4,000 per state resident. And while much of the recent focus has been on the opioid crisis, the report found that alcohol use causes more economic damage.

Mental Health Trust legislative liaison Jeff Jessee said there’s a proven way to reduce these costs: Provide treatment to everyone who could benefit from it. He said state funding for programs that provide this treatment is limited.

“It’s stunning to me how much effort is being put forth by this legislature in attempting to reduce the costs of government programs and departments that are at least arguably trying to contribute something positive to Alaska and Alaskans,” Jessee said.

Jessee testified to the health and social services committees in the House and Senate on Tuesday and Wednesday. He noted the costs are greater than the gap between what the state government spends and what it raises in oil royalties, taxes and fees.

The report found that one third of the economic costs from alcohol use are due to the lost income for the families and local economy of those who die from alcohol-related causes.

Other major alcohol-related costs result from the expense of the criminal justice system, health care, motor-vehicle crashes, and welfare.

Anchorage Democratic Rep. Ivy Spohnholz said the information makes lawmakers more aware of the problem.

“I think that the report has done exactly what it was designed to do, which is to show the hundreds of millions and really billions of dollars that we spend each year as a state by not properly grappling with the issue of alcohol and also drug abuse,” Spohnholz said.

McDowell Group Anchorage Vice President Donna Logan noted this is the fourth report her organization has completed since 2001. Each report has had successively more accurate information. This has led the cost estimates from alcohol misuse to rise by 50 percent in the last four years.

“I think when you have better data and better modeling, the credibility of your study improves,” Logan said. “And people are making a lot of decisions with this data, and so we want to make sure it has as much integrity as possible.”

While Alaska’s costs from alcohol are large, the rates of alcohol abuse and dependence in the state were similar to national averages, according to the report.