Employer Considerations for Medical Marijuana

Marijuana remains illegal on the federal level, but 46 states and DC have legalized some form of it.

January 09, 2020

  • Marijuana remains illegal on the federal level, but 46 states and DC have legalized some form of it.
  • The first marijuana-derived pharmaceutical was approved by the FDA in June 2018 for seizures. Health plans and PBMs intend to treat it like any other drug, though it will be distributed through specialty pharmacies.
  • Evidence for the effectiveness of medical marijuana is mixed, with clear risks and potential benefits for people with cancer, epilepsy, multiple sclerosis and other conditions. Little is known about long-term impacts.
  • Since marijuana compounds can stay in the blood system for weeks, employees may fail a drug test without being under the influence on the job.
  • Among employers that conduct drug tests of employees and prospective job candidates, 38% have a “no tolerance” policy for those who test positive active ingredient in marijuana, while 23% provide some exceptions, especially for those who use it for medical purposes.

The growing legalization of marijuana by states presents a challenging set of decisions for employers, particularly regarding drug testing and coverage decisions. While marijuana remains illegal on the federal level and accounts for about half of drug arrests in the U.S., 33 states have legalized some form of recreational or medical marijuana, as of July 2018; another 13 states allow the use of certain marijuana extracts called cannabinoids that do not cause a “high” in the user. The first marijuana-derived pharmaceutical treatment for seizure disorders gained FDA approval in June 2018. Employers, in coordination with safety and compliance departments, may want to consider updates to drug testing and coverage policies based on these developments

Medical Marijuana, Explained

There are two general categories of medical marijuana. The first are pharmaceutical treatments that contain extracts of cannabidiol (CBD) and/or tetrahydrocannabinol (THC). As of January 2019, there is one FDA approved marijuana plant-derived treatment, Epidiolex; containing CBD extracted from marijuana plants, the pill treats seizure conditions and does not create a “high.”3 This CBD treatment is a promising relief for people with treatment-resistant Lennox-Gastaut syndrome and Dravet syndrome. Two FDA-approved drugs contain synthetic THC not derived from a marijuana plant, both of which are used by cancer patients to treat chemo-related nausea and vomiting, as well as by people with anorexia or HIV/AIDS to increase appetite and weight gain.4,5 Additional CBD-based pills, oils and other products are marketed for a variety of medical conditions and available in some states, but are unregulated and therefore should be taken with caution and under the supervision of a health care provider. A December 2018 law signed by the president legalized hemp and opened a pathway for FDA-regulation – and legalization – of non-prescription CBD products on the federal level.6

The second category of medical marijuana is what is commonly understood as “regular”, THC-containing marijuana, taken for medicinal purposes. This can come in the form of marijuana plants, oil extracts that can be eaten or vaporized, and foods. State laws vary, but in many of the states with comprehensive medical marijuana laws, a medical provider can write a prescription for marijuana that can be purchased out-of-pocket at marijuana dispensaries. In states with legalized recreational marijuana, a person could purchase it normally, but intend to use it for medicinal purposes. In contrast to CBD-only extract treatments, this form of marijuana creates a high in the user.

Know Your Acronyms: THC and CBD 

Over 100 chemicals, called cannabinoids, are found in marijuana. Among them is THC, which creates a “high” in the user and is potentially addicting when the plant or derived product is smoked, vaporized, eaten or otherwise ingested. Other cannabinoids have different impacts and are not necessarily mind-altering. In particular, CBD doesn’t create a high or cause dependency, but has been effective in preventing some otherwise treatment-resistant pediatric seizures. Researchers are exploring other potential treatments with CBD.2

Tetrahydrocannabinol (THC)


Cannabidiol (CBD)


Is Medical Marijuana Safe?

Approximately nine percent of marijuana users are dependent on it.2 Among people who try marijuana before the age of 20, the rate of dependence increases to 17%. Individuals dependent on a drug cannot function normally without it and generally experience withdrawal symptoms if they discontinue its use. As compared with alcohol (15% of users are dependent), tobacco (32%), cocaine (17%) and heroin – an opioid – (23%), marijuana is slightly less habit-forming, according to the Institute of Medicine.7,8 See the Business Group's Evidence-Based Treatments for Substance Abuse Disorder article for more detail on employer strategies for helping prevent and treat addiction.

Marijuana use carries real risks. THC can cause relaxation, drowsiness, mood changes, altered senses, impaired memory, and when taken in large doses, hallucinations, delusions, dependency and psychosis.2 Smoke inhalation and eating high calorie foods in abundance, both associated with many users’ experience with marijuana, are harmful as well.

Most people who use medical marijuana are over 35, while most who use the drug recreationally and regularly are under 35.7 This suggests that more dangerous, frequent and habit-forming use is less likely among medical marijuana users. However, ingesting marijuana by smoking, vaporizing, or eating it has a negative impact, in addition to the potential for dependence and the dangers associated with being high. Pharmaceuticals with THC or CBD extracts can be titrated so a person knows the dose they’re taking, but people using marijuana do not necessarily know the potency of what they’re ingesting. Drugged driving is likely underreported in the U.S. Any person using marijuana for medical purposes must weigh the risks and benefits of use of the drug and where they obtain it, just like with opioids, chemotherapy and elective surgery. As with many medical treatments, risks vary by patient population. Children, pregnant women, and people with a history of substance use disorder should not ingest THC.

What Does the Evidence Say?


The American Cancer Society (ACS) notes that the THC in marijuana can help some people relieve pain and nausea, and reduce inflammation, while CBD can help prevent seizures, reduce anxiety and paranoia.4 The National Multiple Sclerosis Society (NMSS) reviews several studies that show some patients have success in MS symptom management with marijuana, helping to reduce pain, tremor and spasticity, or their subjective experience, in patients for whom other treatments aren’t effective.8

An IOM report on the evidence base for marijuana used medicinally assessed dozens of studies which, in addition to shedding light on marijuana’s use in treating the effects of MS, epilepsy, and cancer, also reviewed evidence of marijuana’s potential for general pain management, anxiety-reduction, and induced drowsiness (as a sleep aid).9 In general, studies of people using smoked or eaten marijuana for medicinal purposes that wasn’t specifically titrated for that patient (e.g. consumption of what is commonly understood as “regular” marijuana) find greater risks and fewer benefits than in those for whom production of the treatment is tailored to the patient. More research is needed on the long-term impact of medical marijuana in any form.

Lack of Extensive Research

It’s difficult to generalize about the impact of this second category of “medical” marijuana on people with particular conditions, because marijuana outside of a limited number of approved studies can vary widely in potency, dosing and route of administration. More research is needed to better understand the potential risks and benefits of using marijuana for medical purposes.

There is a single federal license for the cultivation of marijuana for research purposes housed at the University of Mississippi, and researchers interested in obtaining marijuana grown there must obtain approval from the Department of Health and Human Services, the Food and Drug Administration, and the Drug Enforcement Administration.10,11

Importance of Shared Decision-Making with Providers

As with any medical treatment, one person’s experience with marijuana will often differ from that of another, such that the drug could be anxiety-reducing in one person and anxiety-enhancing in someone else. Similar to other drugs like alcohol, some people are particularly susceptible to developing a dependency on marijuana based on their physical and genetic makeup, while others do not carry as high a risk. Patient and physician groups generally stress the importance of a shared decision-making process that considers a person’s circumstances, values, desires for treatment outcomes and risk tolerance before taking marijuana.

Changing Landscape – Budding Support for Marijuana Legalization

Medical Marijuana for Pain as an Antidote to the Opioid Crisis? Evidence is Mixed.

The U.S. National Institute on Drug Abuse (NIDA) and the National Institutes of Health (NIH) have funded several studies on the impact of marijuana legalization on adverse events related to opioids. While multiple studies found that states that legalized marijuana, particularly those with active marijuana dispensaries, had fewer opioid prescriptions, overdoses and related deaths, these were population-level impacts that showed correlation, rather than proving causation. Medical marijuana may reduce the dose of opioids needed to treat some pain, but could also increase the likelihood of developing non-medical opioid use disorders, according to an NIH study. Patients taking opioids or marijuana for pain should engage in shared decision-making with a medical provider to understand the benefits and risks.

According to a 2017 Yahoo News and Marist college Survey, 133 million Americans have tried marijuana, and of those, 35 million continue to use it monthly; and 20 million do so annually.12 As of 2017, 61% of Americans support legalization of marijuana, up from just 16% in 1990.

Drug Testing and Medical Marijuana Accommodations 

See the Business Group’s Public Policy Resource on Marijuana Legalization and the Workplace for details on state and federal legal issues related to drug testing and accommodations. Below is a discussion of pros and cons for different drug testing approaches.

What Wouldn’t a Drug Test Include Marijuana

No one wants to hire an employee who is high on the job. So why would an employer that conducts drug tests not include marijuana? There are three main reasons:

  • FDA-approved medications that contain CBD, which in rare cases can trigger a positive result, and synthetic THC can put an employee using medically necessary medications at risk for termination or preclude them from being hired. 
  • People using THC-containing products medically or recreationally, outside of working hours, may be at risk of termination or not being hired. A marijuana high generally lasts three to four hours, depending on the dose and duration, but THC can stay in a person’s body in measurable amounts for up to two months.14,15 The body metabolizes many other drugs like alcohol within hours, so use outside of work generally doesn’t threaten employment status.16 Since over half of Americans have tried marijuana and one-fifth currently use it, “no tolerance” drug testing could exclude acceptable and high-performing job candidates.17

In some states that have legalized medical or recreational marijuana, employers have been sued under state law for terminating employees for marijuana use. 

Learn More

Why Include Marijuana in Drug Tests?

Major reasons to include marijuana in drug tests include safety, company culture and legal requirements:

  • Excluding marijuana from drug testing may increase the number of employees who use marijuana and give the impression that the company is permissive of on-the-job use. Being high on the job can create significant safety and performance concerns.18
  • Using marijuana is illegal on the federal level and, while an employer may not fire an employee for doing anything illegal (e.g. failing to pay child support), an employer may consider its use as a violation of company employment standards. The company’s culture and leadership values may also play a part in the decision to test for marijuana.
  • Licensing for some industries requires expansive drug testing, such as transportation, certain government contractors, aviation and health care. Employers with employees in safety contingent jobs should test for marijuana.
  • Changing Landscape – New Types of Marijuana

As states legalize the production and sale of marijuana, the ways the drug is delivered is expanding as well. In many states, it is legal for consumers to obtain various edible foods with THC in them, marijuana pills, vaporizer pens (“vape” pens) that look like a pen or a cell phone, and other products. Many of these do not carry the same odor as smoking marijuana, making it more difficult to determine when someone is using the drug.

Potential Exceptions for Employees Who Use Medical Mar

According to a HireRight survey of nearly 6,000 human resource professionals across the U.S., 63% of responding organizations conduct drug screenings of prospective hires or current employees, and 67% have medical marijuana policies.19 See the table below for pros and cons of potential marijuana testing policies and the percentage of employees that use them.

Can I terminate Employees Who Use Legal Medical Marijuana?


Depending on how state law is written, it may be illegal for an employer to terminate an employee for testing positive for medical marijuana, even if using marijuana is illegal on the federal level.20 A 2017 decision in Connecticut found that federal law does not preempt a state law that “bars employers from firing or refusing to hire an employee who uses medical marijuana in compliance with the requirements of Connecticut law.”21 The Massachusetts Supreme Court in 2017 found that an employee who had been terminated for medical marijuana use could not sue their employer under the state law that legalized medical marijuana, but they could sue for discrimination against people with handicaps, for which the person had been using the product.22

When state and federal law disagree, employers are in a difficult position and should consult their legal counsel

Thinking Public Relations: One large employer ended up on the NBC Nightly News after it fired an employee with brain cancer for using marijuana on their off days. While this action was legal, it was not necessarily advisable. Conversely, a permissive marijuana policy in some industries could create even more concerning headlines.

What Is Your Company Culture and Tolerance for Risk?

Your company culture can help guide whether and how you approach drug testing for marijuana. For employers in Seattle or Denver looking to attract young talent – whether or not they use marijuana – being known to fire employees who test positive (or even testing in the first place) for marijuana may make your organization less attractive. Conversely, for highly regulated industries, such as transportation, where any kind of impairment creates a serious safety concern, rates of drug testing and zero-tolerance policies are appropriately high.

Employers should consider their company culture, industry and geographies when calculating the time, expense, public relations issues and potential legal impact of drug testing for marijuana, or when debating whether to terminate a person found taking marijuana, either for medical or recreational use.  

Consider Employee Education

Especially in states that have recently liberalized marijuana laws, employers should consider educating employees on drug testing policy, the importance of safety and productivity on the job, some of the risks of using it, and impact of state law on your company’s approach. Again, take into consideration your company culture and consult your legal team when creating information campaigns on marijuana.

Do I have to Cover Medical Marijuana Where It’s Legal on the State Level?

National health plans and PBMs anticipate treating the FDA-approved marijuana-derived medication just like any other once it hits the market, with a standard medical review before making a coverage determination.23 Given the lack of FDA approval for most medical marijuana treatments and illegality on the federal level, carriers generally consider medical marijuana—both THC-containing and CBD-only forms— unproven and experimental, precluding coverage. We are not aware of any ERISA plans that currently cover medical marijuana products without FDA-approval. FDA-approved dronabinol and nabilone that contain synthetically produced THC for treatment of chemotherapy-induced nausea and increased appetite are generally covered by carriers and PBMs.

State requirements for coverage by employers have become cloudier based on recent court cases. Three rulings by the New Mexico Court of Appeals in 2014/2015 decided that the state employees’ workers’ comp coverage must include the cost of medical marijuana, provided the usage qualifies as reasonable and necessary medical care related to the work injury.25 Undoubtedly, others are looking at New Mexico as a potential model for suing for coverage in states that have legalized medical marijuana. An employer being sued for non-coverage of medical marijuana deemed medically necessary by a physician should consult legal counsel.

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  1. Medical Marijuana, Explained
  2. Changing Landscape – Budding Support for Marijuana Legalization
  3. Drug Testing and Medical Marijuana Accommodations
  4. What Is Your Company Culture and Tolerance for Risk?
  5. Do I have to Cover Medical Marijuana Where It’s Legal on the State Level?