When $50 Billion Isn’t $50 Billion: Opioid Settlements in Local Fiscal Context

• In Event: From Funding to Outcomes: Evaluating Opioid Policy, Spending, and Treatment Access

Abstract

Introduction/Background: The opioid epidemic has caused devastating harm across the United States, prompting landmark litigation resulting in approximately $50 billion in settlements from manufacturers, distributors, and retailers that will be distributed to state, local, and tribal governments over 18 years. These funds are widely perceived as a transformational opportunity to expand opioid remediation efforts. However, once divided across thousands of subnational governments and distributed over many years, individual allocations may be far too modest to make a meaningful difference. Purpose/Research Question: This study asks whether opioid settlement revenues constitute a fiscally significant source of funding for local government opioid remediation services, and for which types of governments they matter most. Because our federal system distributes fiscal responsibilities to multiple levels of government, revenue structures and expenditure behaviors vary widely across jurisdictions. Consequently, we expect the fiscal significance of these settlements to differ markedly across local contexts. Methods: We construct a novel dataset linking opioid settlement payments to detailed local government health expenditure data, enabling systematic comparison of settlement allocations relative to existing spending across jurisdictions. Results/Findings: Early findings reveal substantial heterogeneity: settlement funds range from less than 1% to over 200% of total local health expenditures, demonstrating that the settlements' fiscal significance varies dramatically depending on local context. Ongoing analyses will identify which types of local governments stand to be most affected, paying particular attention to rurality, overdose mortality, and local fiscal capacity. Conclusion/Implications: These findings carry important implications for both researchers and policymakers. Evaluations of settlement impacts must account for this variation, as differences in observed outcomes may reflect the fiscal significance of settlements to local communities rather than the effectiveness of specific interventions. Policymakers designing allocation strategies should consider local fiscal context to ensure resources reach the governments where they are most consequential and least likely to be absorbed into existing budgets.

Author

• Amanda Isabel Mauri, University of Maryland, College Park
  Presenting Author