Economic analysis: Prescription-only status for PSE would drive up physician visits, healthcare costs

WASHINGTON — According to an economic impact analysis released Tuesday by Martin Kennedy, a former professor of economics who spent seven years on the faculty of Middle Tennessee State University, adopting a prescription requirement for pseudoephedrine products in Tennessee would result in an influx of more than 497,000 additional physician office visits at a direct cost of $44.3 million annually.

"A prescription mandate for pseudoephedrine is a costly and ineffective approach to dealing with Tennessee's meth problem," stated Tennessee State Sen. Mae Beavers, R-Mt. Juliet. "With direct costs estimated at over $44 million dollars and indirect costs substantially higher, such a proposal would need to guarantee positive results to even be considered. Yet there is no guarantee that a prescription requirement would truly address the real sources of the overall meth problem since it does nothing to deal with the near-constant flow of meth from outside of Tennessee, or the necessary treatment of those who suffer from serious drug addiction," he said. "State leaders need to focus on balanced policies that don't burden law-abiding Tennessee families if they are going to make real progress in this fight."

"I approached this study with a very open mind. As a Tennessee citizen and a father of five, I believe very strongly that something more must be done to tackle the scourge of meth production in our state," Kennedy said. "As an economist, however, there's no question that when conducting a detailed analysis of a prescription requirement, the new costs associated with such a policy change are striking and considerable. I hope that these empirical findings will provide policymakers with a fuller understanding of the potential impacts of the prescription-only approach."

"Members of the Tennessee General Assembly are to be commended for looking for new policy solutions to the state's ongoing methamphetamine problem," stated Scott Melville, president and CEO for the Consumer Healthcare Products Association. "But as Dr. Kennedy's new analysis makes clear, a prescription requirement for safe and effective cold and allergy medicines containing pseudoephedrine would have significant — and in our view — unnecessary economic consequences for consumers, healthcare providers, businesses and the state as a whole," he said. "Tennessee families should not be punished for the actions of a criminal minority."

Kennedy's study was supported by a grant from CHPA.