Millions in opioid settlement funds sit untouched as overdose deaths rise

Nearly a year after Montana began receiving millions of dollars to invest in efforts to combat the opioid crisis, much of that money remains untouched. Meanwhile, the state's opioid overdose and death counts continue to rise.

The money is part of the approximately $50 billion that states and local governments will receive nationwide in opioid settlement funds over nearly two decades. The payments come from more than a dozen companies that made, distributed, or sold prescription opioid painkillers that were sued for their role in fueling the overdose epidemic.

Many places have begun deciding where that money will go and making payments to schools, public health departments, and local governments. South Carolina, for example, has awarded more than $7 million to 21 grantees. Wisconsin has posted two years' worth of spending plans that total nearly $40 million.

Montana, West Virginia, and Hawaii are among the states moving slower.

Montana began receiving its first settlement payments in January, and, by fall, payments totaled roughly $13 million. As of early December, the Montana Opioid Abatement Trust — a private nonprofit created to oversee 70% of the state's share — had met once to agree to its rules of operation, and its money remained locked behind an inactive grant portal. The remainder, divided among the state and local governments, either hadn't been spent or wasn't publicly recorded.

Those charged with distributing the money say they're building a framework to spend it in ways that last. Meanwhile, some addiction treatment providers are eager to use the funds to plug gaps in services.

The tension in Montana reflects a nationwide push-pull. Those handling settlement dollars say governments should take their time planning how to use the enormous windfall. Others argue for urgency as the drug supply has become increasingly deadly. More than 100,000 Americans died of overdoses in 2022, surpassing the previous year's record-setting death toll.

Nearly 200 Montanans died of a drug overdose in 2021, the latest year state data is available. That number, likely an undercount, is roughly 40 more deaths than the year before. Emergency medical responders have continued to record an increasing number of opioid-related emergencies this year.

In Billings, the Rimrock Foundation, one of the state's largest behavioral health providers, has seen its number of clients with opioid use dependency more than triple since 2021. Like other treatment facilities, Rimrock has a waitlist, and addiction treatment providers worry about the limited community resources that exist for patients once they are discharged. "The result of not addressing this is a lot of deaths," said Jennifer Verhasselt, Rimrock Foundation's chief clinical officer.

Debbie Knutson, Rimrock's medical unit and nursing supervisor, said there is widespread confusion about how and when the state's settlement dollars can be used.

"It's very concerning if we have money available that we could use to help people that is just kind of sitting, waiting for somebody to decide where it should go," Knutson said.

Rusty Gackle, the Montana Opioid Abatement Trust executive director, said a lot of work has happened behind the scenes to get local governments ready to accept their initial payments and for regional leaders to form systems to request money from the trust. That included hosting a series of town hall-style meetings to share information about the process. He said many of those local regions are still finalizing their governance structures.

"I would love to progress a little bit faster," Gackle said. "But I'd rather do it right so that we're not having to go backwards."

Montana officials got a late start too, he added. Some states began receiving settlement dollars last year, but Montana was toward the tail end of the line.

Montana is dividing its money three ways: 15% to the state, 15% to local governments, and the rest to the Montana Opioid Abatement Trust, with some money set aside for attorneys' fees.

As of late November, the state hadn't begun spending the $2.4 million it had in hand for state agencies. Officials also aren't tracking how and when local governments spend their direct payments.

Similarly, West Virginia and Hawaii hadn't — by late November — begun spending the largest shares of their funding. In West Virginia, the makeup of the foundation board that will oversee roughly 70% of the state's settlement dollars was announced only in August, six weeks after the state's deadline, and the board is now sitting on more than $217 million.

Nationwide, state and local governments have received more than $4.3 billion as of Nov. 9. How much of that has been used remains uncertain due to states' lack of public reporting. But from what is known, it varies.

Colorado, whose spending plan is similar to Montana's but received its settlement money earlier, has allocated millions toward school and community-based programs, recovery housing services, and expanded treatment services.

Sara Whaley, a Johns Hopkins researcher who tracks states' uses of opioid settlement funds, said a slower start isn't inherently wrong. She prefers governments take time to spend the money well rather than fund outdated or untested practices. In some cases, governments are building entirely new systems to dole out the money. Several waited until the courts finalized the settlement amounts and details.

"There are definitely states that were like, 'We are going to get money at some point. We don't know how much or when, but let's start setting up our system,'" Whaley said. "Other folks were like, 'We have a lot going on already. We'll just wait until we get it and then we'll know what the settlement terms are.'"

Even once committees start meeting, it can take months for the money to reach front-line organizations.

Connecticut's opioid settlement advisory committee made its first allocation in November, eight months after it was formed. Maine's recovery council, which controls half the state's settlement funds, has been meeting since November 2022, but just recently voted on priorities for the more than $14 million it has on hand and still needs to establish a grant application process.

Tennessee's Opioid Abatement Council accepted grant applications this fall. Stephen Loyd, council chair, said the process — from picking awardees to processing payments — will take roughly six months. Within that time, he said, 2,808 Tennesseans are likely to die of drug overdoses.

As an interim step, Loyd proposed at an October meeting to award $7.5 million to an emergency six-month initiative to flood the state with naloxone, a medication that reverses opioid overdoses.

But his proposal was met with protests from council members, who pushed back on what they saw as a circumvention of the grant process they had spent months establishing. The council didn't vote on the emergency initiative but instead created an expedited review process to consider fast-tracking future applications.

Gackle said he doesn't think Montana is far behind others. Now that spending systems are almost in place, he said, things should move faster.

Lewis and Clark County, home to the state capital, Helena, has a yearlong plan and budget for opioid settlement funds. A cohort of 17 counties in rural eastern Montana defined its regional settlement decision-makers in November and, by early December, had yet to begin official talks about where the money should go.

Brenda Kneeland, CEO of Eastern Montana Community Mental Health Center and an advisory committee member for the Montana Opioid Abatement Trust, said eastern Montana has one inpatient treatment center for substance use disorders and zero detox facilities, so emergency rooms end up serving as a fallback resource.

Kneeland said local officials want to ensure they understand the rules to avoid trouble later and to stretch the funding.

"You don't get an opportunity to try to correct such a wrong very often," Kneeland said. "It's just a huge job at a county level. I've never seen an undertaking like this in my career."

The Montana Opioid Abatement Trust advisory committee will meet quarterly, meaning its next chance to review any submitted grants will be next spring.

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KFF Health News, formerly known as Kaiser Health News (KHN), is a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism.

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• Opioid Epidemic
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• Oxycotin