My insurance card was illegally used to obtain narcotics, what should I do?

What they did is insurance fraud. You should report it to the insurer and, possibly, the police. The reason is this: if it comes to light and you have not gone ahead and reported it yourself, you might be assumed to be involved or a participant in the scheme. Since insurance fraud is quite serious--and the fact that it was to obtain a narcotic potentially introduces an element of abuse of a controlled substance--you do *not* want there to be any suspicion that you were involved.