After years of litigation, states and localities have finally started receiving a sizable share of the $50 billion secured through several master settlement agreements (MSA) with pharmaceutical companies, distributors, pharmacy chains and advertisers accused of contributing to the opioid crisis. This funding, if used appropriately, represents a generational opportunity to combat one of the worst drug crises in American history.
However, it has been difficult to follow where the money is going. While most of these settlements dictate at least 70% of the funds must be spent on opioid recovery, treatment or prevention, state entities overseeing this spending are not required to report how the funds are being used.
Our review of the spending that can be tracked shows that states are clearly taking different approaches with their settlement dollars, which may be appropriate given their varying experiences with the opioid crisis and its harmful impacts. What’s less clear is whether they’re investing in evidence-based strategies.
A substantial share of funds is being used for unclear purposes
States and localities received over $6.5 billion in opioid settlement funds in 2024 and committed roughly $2.7 billion (41.5%) of it. Yet, the most recent nationwide reporting reveals 19 states still do not provide information on how those dollars are being spent. In the states publishing data, the quality and detail of reporting vary considerably.
The process for allocating funds varies by state, but two-thirds (33 states) have advisory committees. Others utilize independent authorities, legislative appropriations or other methods.
We examined publicly available data reported as part of an impressive effort from KFF Health News, the Johns Hopkins Bloomberg School of Public Health and Shatterproof to track where these dollars are going. We sorted the allocated program dollars into four separate buckets based on intended impacts:
- Treatment & Recovery (e.g. warm hand-off and recovery services, treatment for incarcerated populations, medication for opioid use disorder (MOUD))
- Prevention (e.g. community-based programs, philanthropic outreach, addiction resources)
- Harm Reduction (e.g. naloxone and reversal medication, expanding syringe services)
- Money Targeting Special Populations (e.g. pregnant women, youth in foster care, neonatal babies)
We found that the largest share (39.3%) of the total committed funding in 2024 ($1.06 billion) went to an unexpected fifth category: Other. (Figure 1, interactive version) The inability to determine from public reporting how those funds are being used raises alarms for many of us who remember the misallocation of tobacco master settlement funds.
The next largest category was treatment and recovery services, which received nearly 37.4% of committed funds ($1 billion). Harm reduction received 13.3%, followed by prevention programs (8.8%) and spending on high-risk populations (1.3%).
It’s also important to consider variation across states, which have had unique impacts from the epidemic. Figure 2 identifies the nine states that allocated at least 60% of their 2024 funds to treatment and recovery services and shows where the remaining dollars went. New Hampshire is a notable outlier, allocating 97% of its funding to treatment and recovery, followed by Montana (79%). The remaining seven states dedicated between 60% -70% of the funds for this purpose.
These nine states had very little funding left over for other areas. Only two states (Kentucky and Montana) allocated a relatively large remaining share to prevention (15% each), and two other states (North Dakota and Vermont) allocated a relatively large share to harm reduction programs (10% and 13%, respectively). States were more likely to allocate more than 10% of their remainder to other, undefined purposes.
Few states made substantial investments in harm reduction, with the notable—and perhaps surprising—exceptions of political opposites Texas (83%) and California (64%). Most other states allocated less than 10% of their funds to harm reduction. California dedicated most of its remaining funds to treatment and recovery (19%) and “other” (10%), while Texas put the bulk of its remaining funds into “other” (10%) and prevention (7%).
While prevention has generally received a much smaller share of the pie, a few states put over 20% toward prevention (Figure 4). Among these, Louisiana, Ohio and Washington D.C., allocated over 40% toward treatment, while treatment was the second largest category in Oklahoma and West Virginia. Most of these states dedicated most of their remaining funds toward “other.”
The evidence base for effective spending is clearer than many realize
The scientific literature provides a practical framework for evaluating these investments by considering approaches that reduce fatal and non-fatal opioid-related harms. In the short term, scientifically supported methods for reducing fatalities include naloxone availability and training, drug-checking technologies like fentanyl and xylazine test strips, and warm-handoff programs for people leaving jails and prisons to prevent overdose deaths.
Over a longer timeframe, as the crisis continues to evolve, the evidence supports increasing investments in prevention, reducing risks related to new synthetic drugs by strengthening the surveillance infrastructure to identify and track emerging synthetic drugs, and by expanding access to evidence-based treatments such as MOUD and contingency management.
Making it easier for people to access and stay in treatment can also reduce long-term, nonfatal harms. Reducing barriers that keep people from accessing and staying in care by expanding who can provide treatment, reducing cost through broader insurance coverage (especially Medicaid), and allowing first responders and emergency departments to start buprenorphine immediately after an overdose are all effective approaches. Reducing non-fatal, short-term harms involves harm reduction strategies such as xylazine test strips, community-based healthcare services, as well as Good Samaritan laws and family-centered supports, such as programs that make it easier for pregnant people and parents of young children to access treatment.
Taken together, this evidence can help state policymakers prioritize opioid settlement investments that are most likely to reduce opioid-related harms.
Why this matters: the opioid crisis is evolving and federal funding is declining
The opioid crisis has evolved substantially over the past two decades, and approaches to addressing it must also change. Fentanyl has transformed the risk landscape from what it was a decade ago, and xylazine, nitazenes and other emerging substances are reshaping it further.
What works in a rural community with limited treatment infrastructure is not necessarily what will work in a densely populated urban county with existing services. States need to collect further data, track ongoing evaluations and develop a willingness to adjust practices as new evidence emerges. This requires funding surveillance systems and building genuine partnerships with the full range of community stakeholders, including people who use drugs, families, first responders, healthcare providers and local governments.
Ensuring that settlement funds aren’t squandered on low-evidence programs, administrative costs or unrelated political priorities has become even more vital for at least two significant reasons.
First, the federal government has substantially reduced funding to support opioid treatment and recovery in the past two years. These reductions include cuts to Medicaid that threaten access to treatment, reduced support of MOUD and harm reduction, blocking use of federal funds to support testing strips and cuts to funding for addiction research. Although Congress on a bipartisan basis renewed the SUPPORT Act in 2025, funding for its activities remains unappropriated.
Second, the drug supply continues to evolve and change, affecting local markets in very different ways. Data from the UNC Chapel Hill Street Drug Lab reveals that the drug markets tend to be regional, if not local. Of the 90 routinely detected substances they have identified in their drug testing in the last four years, only 20 turn up everywhere at similar rates, indicating that the vast majority of new substances are introduced first in particular markets. States and localities need the flexibility to adapt to their own unique market and needs, but they can still rely on evidence-based approaches to addressing those unique experiences.
The science about what works is not perfect, but it is far stronger than the current spending patterns in many states suggest. Getting opioid settlement spending on the right path starts with transparency, continues with evidence, and requires humility to keep learning and adapt as the crisis changes.
