Economic Cost of Addiction in Philadelphia

Addiction is more than a personal struggle. It affects families, workplaces, healthcare systems, and entire communities. In Philadelphia, the consequences of substance use disorders are visible in overcrowded emergency rooms, overwhelmed law enforcement agencies, and lost productivity in the workforce. The financial burden is staggering, costing the city hundreds of millions of dollars each year in medical expenses, crime-related costs, and economic losses.

One thing to bear in mind is that behind every statistic is a person, whether that’s a parent, a sibling, or a friend, whose life has been disrupted by addiction. In 2023 alone, Philadelphia saw 1,315 overdose deaths, according to the Pennsylvania Department of Health. A staggering 79 percent of those overdose deaths included fentanyl. As you can see, the cost is not just measured in dollars but in lives lost, families broken, and communities struggling to recover.

Understanding the financial toll of addiction is critical for policymakers, business leaders, and residents who want to see change. By looking at the numbers, we can better grasp the scale of the crisis and recognize the urgent need for solutions. Addressing addiction is not just a matter of public health; it is an economic necessity for the future of Philadelphia.

Philadelphia, like much of the country, is grappling with the devastating effects of addiction. The opioid crisis has disproportionately affected the city, with Philadelphia leading Pennsylvania in opioid-related deaths. The economic impact of addiction has a lasting effect on the city’s resources, businesses, healthcare, and social services, which we’ll examine below.

Healthcare Costs are A Heavy Burden

Addiction-related healthcare expenses place a significant burden on Philadelphia’s medical facilities and government-funded programs. In 2017, Pennsylvania spent $53.77 billion to address the opioid crisis, and a substantial portion of that cost is borne by cities like Philadelphia.

The state’s healthcare spending includes emergency room visits, hospitalizations for overdose victims, long-term rehabilitation services, and mental health treatments. The cost of opioid-related emergency room visits in the city is substantial, reaching millions each year.

Philadelphia recently experienced an increase in opioid overdose deaths that led to an increase in emergency services, medical treatment, and hospital admissions. Each overdose requires immediate medical attention, often in an emergency room where critical resources are required. As the numbers of addiction-related incidents grow, so too do the financial burdens on healthcare providers, who struggle to meet the increasing demands for care.

Lost Productivity and Employment Costs

One of the most far-reaching impacts of addiction in Philadelphia is the loss of productivity in the workforce. Employees struggling with addiction are more likely to miss work, show up late, or underperform. As a result, businesses experience a loss in productivity and increased costs in terms of employee assistance programs, health insurance, and workers’ compensation claims.

Substance abuse also reduces employability in the long term. Individuals with addiction may experience prolonged periods of unemployment or underemployment, further straining public assistance programs.

In Philadelphia, the opioid epidemic has left many families struggling with unemployment or low wages, as addiction hinders their ability to secure stable jobs. It also limits their capacity to contribute to the local economy, creating a cycle of poverty and addiction that is hard to break. As unemployment rates rise, so does the pressure on social welfare programs, putting even more strain on city and state resources.

Criminal Justice Costs are like Fighting an Uphill Battle

The criminal justice system in Philadelphia is heavily burdened by addiction. Individuals struggling with substance abuse are disproportionately involved in the criminal justice system, either through drug-related offenses or crimes committed to feed their addiction. Between 2007 and 2016, total costs to the Pennsylvania criminal justice system were over $526 million, with a significant portion of this money directed toward drug-related offenses and addiction treatment programs for those in the system.

In Philadelphia, the cost of addiction-related crime is equally as bad. Drug-related arrests account for a significant percentage of the city’s overall arrests, creating a backlog of cases that further strains local law enforcement. Drug offenses often result in long-term incarceration, putting additional pressure on the prison system and adding to the cost of maintaining jails and detention facilities.

Even more troubling is the fact that many people with addiction end up cycling in and out of the justice system, as they are arrested for low-level drug offenses but fail to receive effective rehabilitation. Without access to addiction treatment and recovery programs, these individuals are more likely to reoffend, leading to ongoing costs for both the city and the taxpayers.