Medical Marijuana vs. Recreational – Chemistry, Taxes, Regulation & More

We’re looking at medical marijuana vs. recreational, specifically significant differences in potency, sales, growing methods, legal regulation, and economics. Naturally, we’ll cover what it means for your insurance too. 

Skip ahead using the table of contents below. 

Let’s get started. 

Quick Summary

Despite continued prohibition at the federal level in the United States, cannabis used for medical purposes has gained wide acceptance leading to 36 states allowing sales as of mid-2021. Recreational weed suffers from more stringent legislation. Federal law has changed allowing for more research into medicinal use, but it will take some time before long-term studies can draw conclusive evidence. Clinical trials are likely even further off.

In the meantime, medical patients report relief from a variety of health issues, even over conventional medicine. The important difference between recreation and medicine typically boils down to the CBD to THC ratio in the product. There are more subtle differences in how cannabis is grown, taxed, and even the age limit at which it’s available.

To get life insurance if you have a qualifying condition and a medical marijuana card, companies examine it based on the condition. Give us a call at (888) 987-8447 if that’s the case.

Chemical Differences

The main chemical difference between recreational and medical cannabis is the ratio of THC to CBD in the strains and processing. 

THC provides the psychoactive element of cannabis. CBD adds the medical value, from what medical research has indicated so far. It’s technically psychoactive since it affects brain chemistry, but it does not produce a high. That’s why you can get everything from CBD soda to CBD socks in regular stores. 

medical vs. recreational marijuana ingredients

Within the other cannabinoid compounds in cannabis, (THC and CBD are only two out of over a hundred) there are a few other compounds that are getting attention: flavonoids and terpenes. Both are naturally occurring in plants, generally thought responsible for scent and flavor.

Terpenes, in particular, are becoming the subject of increasing research as people report different terpene combinations in their cannabis creates different types of highs. 

Medical Marijuana

Medical marijuana tends to contain higher ratios of CBD to THC, with the current medical research indicating that most medical benefits from marijuana come from the cannabidiol or CBD. It does not cause a high. Many medical marijuana products tend to contain no to low THC. However, this heavily depends on what condition the cannabis is for. Some conditions, like cancer benefit from the hunger-stimulating qualities of THC.

Each state has a different set of rules on what qualifies for a health condition for which a doctor can issue a medical marijuana card. These often include the following medical reasons, but each state varies. 

  • MS
  • Glaucoma
  • Pain & chronic pain
  • Anxiety
  • Eating disorders
  • Cancer
  • Nausea
  • Seizures
  • PTSD

While most states have guidelines on what medical marijuana can be prescribed for, the only FDA-approved drug is for seizures. Other studies on both animals and humans suggest that CBD helps with anxiety, insomnia, chronic pain, arthritic inflammation, and addiction. 

Studies of people using recreational and medicinal cannabis in states where it is legal have shown a correlation with a decline in opioid addiction cases. This suggests that people are finding relief with medical marijuana (or skipping the medical card and buying recreationally) with conditions that might otherwise lead to opioid use and addiction.

Delivery methods for CBD products also have a wider variety than recreational products. While over-the-counter CBD products can be found in almost anything now, more medically reputable products like topicals are reported to help with arthritis. Smoking tends to be the fastest delivery method, but the variety of topical, tongue droppers, and edible cannabis products can deliver CBD without risking lung damage. 

Another difference popping up in medical dispensaries is CBD isolates and full-spectrum CBD. Isolates will contain only CBD, nothing else. Full-spectrum CBD won’t have any THC, but it will still contain flavonoids and terpenes. 

Some studies are looking into the “entourage effect” of terpenes. So far, indications seem to point toward more benefits from the terpene cocktail than CBD alone. 

Recreational Cannabis

The THC content of recreational cannabis seems to be getting higher and higher – pun intended. As dispensaries cater primarily to recreational users seeking a high (or to relax for an evening), growers compete to produce what consumers are seeking. 

Recreational cannabis can contain little to no CBD, depending on the strain or the blend. 

As the production side of the industry advances, recreational dispensaries are beginning to market cannabis through the terpene blends to cater to specific highs. Do you want a relaxing evening reading in the easy chair, or are you looking for an energetic high to make working in your garden a little more magical?

Money Differences

Let’s start with taxes. 

Medical marijuana isn’t subject to the excise tax that states put on the recreational stuff. The taxes are making the states a ton of money too. California is reporting upwards of $50 million a month in tax revenue. States with small populations, like neighboring Oregon, are still pulling in $10 million a month in taxes.

Recreational marijuana costs more out the door than medical marijuana. Two factors play into this. First, the taxes on recreational marijuana make it much more expensive, even if a recreational dispensary puts the same margin (difference between wholesale and retail prices) on both types, the additional taxes push up the recreational price even further. 

Second, health insurance companies typically don’t cover the cost of medical marijuana. Out-the-door costs would probably be even lower in that case. In many states, you can find specially trained/certified staff to help you select the best strains for specifical medicinal purposes only at a medical marijuana dispensary.

There is much debate over buying stocks in medical or recreational cannabis companies for the more investment-minded. If you’re interested in investment opportunities, Investopedia lays out the differences well in their stock-focused article.

The legal difference varies widely outside of the obvious recreational versus medical distinction in various states since there is no comprehensive federal guideline. One commonality between states is age. Doctors can issue medical marijuana cards to anyone 18 and up. Recreational marijuana sales remain prohibited to anyone under 21 years of age. 

regulation of recreational vs. medical cannabis

Many states have tighter regulations on growing can production practices with medical marijuana. It’s medicine, after all, and one bad batch could seriously injure someone. 

Some states have extra licensing hurdles dispensaries must leap through to sell medical marijuana. The great part is the extra certifications for medicinal dispensaries and their employees mean that they can assist with selecting the right product to meet your specific needs.

In addition to commercial growing and licensing regulations, at-home growing regulations differ between medical and recreational cannabis. Once again you will notice a common theme here, everything varies widely by state. 

Some states will only let you grow for recreational purposes if you’re 25+ miles from a dispensary. Other states differ in whether backyard/outdoor planting is allowed versus an indoor hydroponic system with a maximum of 6 marijuana plants. 

State laws controlling what you can grow at home seem to have nothing in common with each other, much less with their medical vs. recreational distinctions. 

The only commonality between at-home medical marijuana cultivation that recreationalists don’t enjoy is allowing a caregiver to grow plants for medical marijuana patients. 

Life Insurance with Recreational vs. Medical Cannabis

12 life insurance companies won’t penalize recreational consumers. They all have different guidelines based on the frequency of consumption. Many won’t even charge smoker rates.

Companies will look at medical cannabis use separately and then adjust rates based on the medical condition cited for the prescription. 

When medical marijuana first becomes legal in a state, some people will claim something untestable (most commonly back pain) as a reason for the prescription since recreational cannabis is not available. 

Outside of life insurance, the little white lie wouldn’t matter. However, insurance companies have to base rates on whatever is on paper. Undiagnosed back pain terrifies insurance companies, which means they might decline your application. In general, health conditions that are undiagnosed or uncontrolled will cause hiccups in your application.

If this applies to your situation, have an honest conversation with your insurance agent to assess your options. Whatever you do, don’t lie on your life insurance application.


We’d love to see more research on medical marijuana. The good news is that it looks like that’s starting to happen. As more people report on their experiences, both recreationally and as medical treatment, we’ll start to get a picture of the subtleties beyond THC vs. CBD or indica vs. sativa.

How Marcan Insurance Can Help

We keep track of the underwriting guideline changes for insurance companies. That provides you with the most up-to-date information on which companies will not penalize you for marijuana use – recreational or medical. 

All your information is confidential under HIPAA, so if you have any questions, give us a call at (888) 987-8447. We will help you get the right policy in place at the lowest cost from a marijuana-friendly life insurance company.