States allocate the first round of opioid settlement funds

At first, Wesley Keziah was skeptical when he found out his residential rehabilitation program was eligible for a piece of North Carolina’s opioid settlement money. Keziah is the executive director of Ground 40, which serves men who are battling addiction and transitioning out of prison or homelessness. The former heroin addict isn’t willing to budge on a discipleship-based approach to recovery. “I had my hands up a little bit because I don’t want to be tied to the state like that,” Keziah said about the funding.

Over the next several years, North Carolina will receive an estimated $1.5 billion from opioid-related lawsuits. Local municipalities and counties will oversee 85 percent of the money to fund organizations like Ground 40 that are on the front lines of addiction treatment and prevention. In total, more than a dozen companies that made, sold, or distributed opioid painkillers will pay an estimated $56 billion in legal settlements to 46 states.

Lawmakers and advocacy groups are debating the best approaches to beating back the opioid epidemic as the funding begins to make its way to local communities. While states and local governments weigh strategies for allocating the money, Christian rehabs are considering whether to participate. Though some organizations have decided to apply for a small piece of the settlements, they are moving forward with caution, wary of becoming reliant on funding that could change the character of their programs.

The largest chunk money comes from a 2021 settlement between 46 states and opioid manufacturer Johnson & Johnson and the three largest drug distributors, AmerisourceBergen, Cardinal Health, and McKesson. The companies, accused of fueling an epidemic of opioid addiction responsible for the deaths of millions, agreed to pay out $26 billion over 18 years.

According to official numbers nearly 110,000 Americans died from drug overdoses in 2022, though experts estimate the total number of drug-related fatalities is much higher. The synthetic opioid fentanyl caused the majority of the deaths, including a record number of fatal overdoses among adolescents.

States and cities reached a second wave of settlements with CVS, Walmart, Walgreens, Allergan, and Teva in November and December 2022, which could total another $21 billion. “Some of these suits are ongoing,” said Mark Dunn, the director of public policy for the National Association of Addiction Treatment Providers. “Maybe a third of them have been decided and amounts agreed to.”

The amount each state receives will vary based on which lawsuits it joined. Population and the severity of the opioid epidemic in a particular locale also play a role in determining the amount.

The settlement agreements mandate that states must spend at least 70 percent on “opioid remediation efforts,” initiatives that treat or mitigate the effects of the epidemic, and report any spending unrelated to treatment, such as administrative costs. Each state is also required to set up an Opioid Settlement Remediation Advisory Committee responsible for recommending what kind of strategies to fund.

Still, states and localities have considerable freedom to craft their own guidelines and decide which programs to fund. “People who are concerned about how the money is being spent, and if it’s being spent wisely and appropriately, should really focus on the process in their individual states,” said Dunn.

Keziah was relieved to discover that the $750,000 that North Carolina awarded to Ground 40 didn’t come with too many strings. “I was very clear with them from the beginning,” he said. “We’re not going to compromise what we teach and what we believe, how we function, or how we ministered to these guys.” The organization can’t use the settlement money to directly fund religious activities, but they are free to use it for transportation and housing costs and to help participants pay medical bills, court fees, or get their driver’s license.

In addition to its focus on Christian discipleship, Ground 40 isn’t willing to compromise on its abstinence-based approach. Opioid replacement drugs like Suboxone may help an individual at the beginning of his journey to sobriety, Keziah said. But long-term medically assisted treatments “exchange one substance for another substance,” he argued. “It’s not sobriety. It’s substitution.” To receive the funding, Keziah said the organization must be willing to point people to a medical facility, but they aren’t required to offer medically-assisted treatments.

In November, His Way Recovery Center, based in Huntsville, Ala., joined 13 other organizations presenting before Alabama’s Oversight Commission on Opioid Settlement Funds. Tom Reynolds, the organization’s director of ministry, has had reservations about accepting government funding in the past, but he said the program’s Christian beliefs and practices have not been an issue during the application process so far. He emphasized that His Way would hesitate to accept the funds if it meant it must adopt a medically assisted treatment model that required giving drugs to recovering addicts. Nor would the organization compromise on a Biblical approach to sexual identity. “It’s not like we have to have the state funding to do what we do,” Reynolds told me. “We’ve operated for a long time without it.”

The Alabama state legislature passed a resolution last year establishing the oversight commission and setting aside the first $10 million for distribution. “And we felt like, as a commission, that we needed to open that up for public hearings and hear what everyone’s already doing in the area of treatment, recovery and prevention,” said Rep. Rex Reynolds, R-Huntsville, who chairs the commission. He said the state will receive approximately $275 million over the next eight to 10 years.

So far, the commission has heard from about 34 organizations, Rep. Reynolds said, both nonprofits and local government agencies. The first $1.5 million will fund a pilot program providing medically-assisted treatment to inmates and parolees. The commission allocated the rest of the initial $10 million to the Alabama Department of Mental Health, the agency responsible for distributing the state’s settlement funds to local programs.

After their presentation, Reynolds with His Way said the organization filled out an application through the department. He isn’t sure how much money His Way is in the running for or when he will find out if the organization received a grant.

Bryan Braddock, CEO of the Christian homeless shelter and rehab organization House of Hope in Florence, S.C., said he applied for $1.2 million through the state to fund their organization’s new Addiction Recovery Center. He said South Carolina denied the group’s initial application and he isn’t sure why, but he tried again, applying for settlement funding through the city of Florence and Florence County. According to Braddock, House of Hope is now approved for about $625,000, which it should receive in the next few weeks.

South Carolina’s opioid settlement money must fund “core abatement strategies” and “approved uses.” These include programs offering supportive and recovery housing to people with substance use disorders. House of Hope provides transitional housing for men and women, so Braddock said the organization applied under that category. “So it fit within our Christian programming without compromising Christian beliefs,” he said.

House of Hope will use the funds to staff the Addiction Recovery Center, and cover maintenance and transportation costs. They’re also approved to purchase a handicap-accessible van. Braddock said the whole process has taken about a year.

Back in Monroe, N.C., Keziah knows the settlement funding won’t last long. Ground 40 houses about 80 to 100 men every four to five months on its farm, ranch, and four transitional houses. The organization doesn’t charge anyone to join, and staff care for the men’s families while they’re in the program. “$750,000 does not go far,” Keziah said. But he’s grateful for one more tool to fight back against the “great catastrophe” that is the United States’ epidemic of addiction.

He’s seen his fair share of tragedy and knows not everyone will reach sobriety. It took 10 years as a heroin addict and 82 arrests before he began rebuilding his life. Still, he’s confident in Ground 40’s approach. “It’s our hope that every man will go back home and be a leader in his household and in his community,” Keziah said. “And we’ve seen a lot of success.”