FITSForum: The Paradox of Opioid Settlement Funds 

by CHRIS SHARP

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Almost $60 billion dollars is coming to the states from opioid settlements with major pharmaceutical companies. This windfall represents a once-in-a-generation opportunity – an influx of money that needs to be spent well. It is important that the recipients of these funds make intelligent, strategic decisions on how to use and actually address some of the biggest problems facing America, starting with the opioid crisis. 

Unfortunately, this opportunity is being squandered – often with no explanation – on things that do little to address the underlying problem of opioid abuse. Instead, the most addicted and dysfunctional continue to be abandoned on the streets instead of getting meaningful treatment.

While some states have taken measures to protect these funds for their intended use, activists advocating for decriminalization or legalization of drugs under “my body, my choice,” and budgetary shortfalls have contributed to bad decisions. In fact, some states are using these funds to pay down debt, to redirect medical budgets, buy passenger vans, pay for refreshments and pens at conferences in schools on youth drug use, and of course Narcan distribution programs and Safe Needle Exchange Programs.

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These programs are misguided at best, actively harmful at worst. For instance, the contradiction of Narcan is that it emboldens the recently revived to look at it as a safety net to keep using – while doing nothing to address the underlying addiction. Similarly, needle exchange programs seem to work well for disease reduction (such as HIV) but do little to address the underlying addiction problem and have been found to actually increase opioid deaths. 

This isn’t harm reduction; it is actively transferring harm to another area under the guise of good intentions and protecting civil rights; all while squandering taxpayer funds, and more importantly, the impossible-to-replicate gift of opioid settlement funds. The question should be, what can states do with this money that will have an immediate and lasting impact? 

Housing is important, but without accountability and treatment, we’re again moving the problem to another location and pretending we’re helping. This is something that Housing First advocates forget or refuse to acknowledge. Community-based treatment, meanwhile, is often the right approach and works well for many people struggling with addiction or mental illness – but it has faced legal challenges. 

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The integrated mandate was initially reinforced by the Olmstead decision, which held that individuals should receive treatment in the most integrated setting appropriate to their needs—yet those that need the treatment most, need more than the status quo for treatment options. At its core, Olmstead was meant to prevent the unnecessary institutionalization of people who could safely and successfully be treated in the community – not outright ban institutionalization, court ordered treatment, or therapeutic communities when they’re needed.

However, that intent has been eroded.

The result is a system that prioritizes ideology over outcomes, while funneling enormous sums into community-based programs with limited accountability and, in some cases, deeply questionable incentives. Homeless people are dying alone on the streets, but in exchange they get to keep their civil liberties intact. Incarceration rates have surged, hospital emergency room admissions for drug addiction and mental illness are at levels that are hard to comprehend, and yet non-profit providers argue that if they had more money they could solve the problem. They haven’t yet, and they won’t. 

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Instead, opioid settlement funds present an opportunity to build capacity that would be better spent on transparent, outcome-based models that have the evidence to back up their programs. In the past, we have focused on community-based treatment without due attention to the clinical appropriateness of that setting and the dangers posed by it.

Seeing how dangerous addiction, serious mental illness, and states of destitution like homelessness are for people, we need to be willing to expand our criteria to save lives. This should go hand in hand with the investments of the opioid funds.

First responder diversion programs like Law Enforcement Assisted Diversion, therapeutic communities like The Other Side Village and The Other Side Academy for adults and Café Momentum for juveniles have proven outcomes and more importantly become self-sufficient – i.e. they won’t require long term government funding for survival. For state-based programs, following Utah’s example with the Homeless Campus, or expanding mandatory treatment laws to include grave disability due to addiction and mental illness are excellent ways to get people the help that they need. 

Opioid settlement funds offer a rare chance to confront addiction with seriousness and discipline. That starts by ensuring the money is actually spent on opioid mitigation and not diverted to cover budget shortfalls, ideological ideas, or unrelated projects. But it also requires directing those funds toward interventions that reduce addiction and restore lives, rather than perpetuating crisis. Without that distinction, the settlements will fail to deliver the change they promised.

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ABOUT THE AUTHOR…

Dr. Chris Sharp is a senior fellow at the Cicero Institute where he focuses on state legislation and policy addressing homelessness, public safety, and higher education. Chris received his Ph.D. in Public Affairs with an emphasis in Criminal Justice Administration. 

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