In a measure of justice for families and communities devastated by opioids, the companies that manufactured, sold and distributed the drugs are beginning to pay for their role in the crisis. This flood of cash — more than $50 billion over 15 years in national opioid settlements — is being distributed to state and local governments around the country, with much of it designated for addiction treatment and prevention, and related services. It’s a staggering sum, as Kaiser Health News has observed, totalling “double NASA’s budget and five times the revenue of an NBA season.”
Big numbers like that can invite inequity and even misuse, however. The 1998 tobacco settlements serve as a powerful cautionary tale. Major tobacco companies were required to pay states an estimated $246 billion over the first 25 years; some payments are ongoing. But analysis of the settlements found that in 2023, less than 3% of funds were being used for smoking prevention and cessation programs. Some states used settlement funds to build roads or fill budget gaps; several states even used funds to support tobacco farmers.
Will states avoid similar mistakes this time around? There have already been critiques of the distribution of opioid settlement funds and calls for greater transparency. As we’ve reported in a different field — the federal government’s trillions in climate dollars and infrastructure investments — there’s a role for philanthropy in making sure such staggering payouts filtered down to state and local efforts end up benefiting those who really need them.
Last year, IP also explored philanthropy’s role — and its significant shortcomings — in combating the rise and ravages of opioid use across America and encouraged the sector to do more. Now, a handful of funders are doing what they can to ensure that the flood of settlement dollars are being distributed to the communities that need them most. While these are mostly local efforts, they’re encouraging, given philanthropy’s lackluster efforts to address a national crisis.
Scattergood Foundation: Participatory funding on the ground in Philadelphia
The Scattergood Foundation is using a participatory approach to distribute opioid settlement dollars in affected communities on behalf of the City of Philadelphia.
The foundation is named after Thomas Scattergood, a Quaker who suffered from depression and worked to promote more humane treatment of those with mental illness. His work contributed to the establishment of Friend’s Hospital in Philadelphia, the first privately run psychiatric hospital in the country. The Thomas Scattergood Foundation was established in 2005 as a health conversion foundation during the sale of Friends Hospital. The foundation supports behavioral and mental health, primarily in the greater Philadelphia area; it is also one of the funders that helped create Mindful Philanthropy, which works to increase philanthropic funding for mental healthcare.
For the last seven years, the Scattergood Foundation has run a behavioral health participatory grant program called the Community Fund for Immigrant Wellness, benefiting immigrant communities in Philadelphia.
“When we say participatory, what we mean is that we hire individuals from the immigrant community,” said Joe Pyle, president of the Scattergood Foundation. “We support them in learning about good grantmaking, building a grant application and building a process to put out an RFP for grants that will support immigrant wellness and behavioral health. We have co-funding from other foundations, and by the end of next year, we’ll have given over $2 million, so [the Community Fund for Immigrant Wellness] has been incredibly successful. That work has gotten a lot of traction in Philly. People pay attention to it.”
Based on that track record, the City of Philadelphia asked Scattergood to distribute some of the funds it received as part of the national opioid settlements. “The city told us, ‘We think a percentage of the opioid dollars should go directly to affected communities. We’d like you to do what you’re doing for the immigrant fund: to build a participatory process for opioid dollars.’ So we’ve done that.”
To distribute the dollars, Scattergood created an advisory committee of community members; the advisory committee in turn developed three granting groups, one each for the North Philadelphia and Kensington communities, which have been hardest hit by opioids. A third granting group distributes funds citywide. The granting groups, which include community members, distribute funds to local organizations. Scattergood provides support and technical assistance; it distributed settlement dollars last year and the year before, and is currently negotiating for a third year.
According to an agreement with the city, the grantee organizations that receive the funds must have budgets of $5 million or below. “These are very grassroots groups,” Pyle said. “The other cool thing is that all the money stays in the communities, because community members are being paid. The people live and work in the community, and that’s where the dollars are going. They’re not going to consultants.”
The community organizations that have received funding through Scattergood include some that provide addiction services; others promote harm reduction, and still others focus on prevention. Pyle cited a youth sports organization that hired a counselor for young people from the Kensington community. “[Grantees] run the gamut from traditional to alternative services,” he said.
In terms of impact, Pyle doesn’t have statistics, but he has seen tangible benefits. “I can’t tell you that we’ve lowered substance use disorder in Philadelphia as a result of this program,” he said. “What I can tell you is that it’s had an economic impact on these communities in a very positive way. We also can say, anecdotally, that we are having conversations in three different communities across the city about the impact that addiction has on their communities and how they can work hyperlocally to improve everything from prevention through treatment.”
Related Inside Philanthropy Resources:
For Subscribers Only
RIZE: Lowering barriers for local organizations
RIZE Massachusetts was launched in 2017 with the sole mission of ending the overdose crisis in Massachusetts. RIZE is a public-private partnership; before the opioid settlements, it received funding from the state and a long list of funding partners. When Massachusetts received opioid settlement funds, it entered into an agreement with RIZE to distribute a percentage of those dollars through the Mosaic Opioid Recovery Partnership.
“We had already been talking to the state about finding a way, whether it was RIZE or some other entity, to make sure that small, community-based organizations would have access to some of the settlement funds,” said Julie Burns, RIZE president and CEO. “So the state put on an RFP, we bid on it, and we were awarded the contract — which is basically $5 million a year for nine years — to facilitate a funding stream for these community-based organizations.”
Burns wishes RIZE had even more money to distribute. “There are so many amazing organizations doing work that deserve to be funded,” she said. In the first funding round, RIZE received 100 applications and funded 18 organizations.
Like Scattergood, RIZE ensures that community members are involved in the grantmaking process. “We have a unique process where we’re working very closely with the community to determine what the funding focus will be,” she said. “We have community reviewers to review the grant applications.” The reviewing teams include at least one person with lived experience: an individual who has used drugs, or has been impacted by the opioid epidemic.
The goal of the funding is to “supplement and strengthen prevention, harm reduction, connections to care and recovery programs with a public health approach,” according to the Mosaic website. Burns ticked off some examples, including a theater group for young people who have faced addiction or have an addicted parent; a program for families of fishermen (a community that has a high rate of opioid use); and a free summer camp for kids who have lost a parent.
RIZE’s participation in the process makes it possible for small, community-led organizations with few resources to access opioid settlement funds. The organization worked closely with the state and community representatives to lower barriers in the process as much as possible. In one example, community members asked if RIZE could keep the application period open until 11:59 p.m. (instead of 5 p.m.) on the date applications were due.
“We made that change, and in the first round of grants, 25% of the applications came in after 5 p.m.,” Burns said. “That would tell you that a lot of these small organizations don’t have a full-time grant writer. It’s probably the executive directors doing it on top of all the other work that they have. That’s just one example, but I think throwing the old playbook out the window and approaching this as a partnership is really important.”
FORE: Supporting effective funds distribution
The Foundation for Opioid Response Efforts was created in 2018 by McKesson Corporation, as IP’s Paul Karon reported. At the time, we concluded that creating FORE was a PR move by McKesson, formerly a major distributor of prescription opioids and one of the companies included in the opioid settlements. But FORE is an independent entity from McKesson, and in the years since it was established, it has carved out a role for itself as the only national private foundation that makes prevention and treatment of opioid use disorder its sole focus. FORE aims to educate providers, advance policy and seek out and support innovative solutions. In one recent initiative, for example, FORE provided funding for programs to improve health and birth outcomes for women with opioid use disorder.
FORE recently announced two new grants, totalling over $1 million, that aim to support and track the distribution of opioid settlement dollars. One of the grants will go to the National Academy for State Health Policy (NASHP), a nonprofit that works with state health leaders. NASHP has received funding from FORE in the past; the new $650,468 grant will allow the organization to provide technical and other support to help state leaders determine the best way to distribute opioid settlement dollars, and to share information and best practices state to state.
“We continue to see the significant role that states have to play in addressing the opioid crisis,” said FORE President Karen Scott. “Even when the dollars are coming down from the federal government, the decisions and the implementation are happening at the state level.”
Distributing the settlement dollars effectively and in a way that satisfies those affected is a heavy lift for states, Scott pointed out. “I’ve seen a few articles coming out already that have been very critical of the states, saying that they’re not spending the money in the right way,” she said. “But what we’re learning and hearing is that it is still really early days, and these are complex processes to set up. We want to support NASHP in proactively fostering the better practices out there by having the shared learning, and bringing in other support or expertise as needed, rather than waiting for the states to make mistakes and then criticizing them.”
FORE has also committed $350,000 to the journal Health Affairs for a special issue on the opioid and overdose crisis. The issue, slated for publication next fall, will also inform state and national policymakers about innovative and evidence-based solutions. The Dogwood Health Trust, Kaiser Permanente and Vital Strategies are also supporting the special issue.
Memory wall
These are only some of the ways philanthropy can play a valuable role in ensuring that settlement dollars are distributed to the communities that need them most. As Scattergood’s Joe Pyle pointed out, “There are things that government can do well and there are things that philanthropy can do well. And I think that with a partnership between government and philanthropy, we can do better,” he said. “If philanthropy can support the work that government has been charged to do, why wouldn’t we do it?”
The good news is that deaths from overdoses have fallen steeply over the last year. Unfortunately, not every community has benefitted. While fewer white people are dying from overdoses, rates are still rising among Black people and Native Americans, the New York Times reported: “Contrary to claims that arrests push people into recovery, research shows that Black people, who are far more likely to be arrested in connection with drugs than white people are, despite similar rates of drug use and sales, are less likely to ever receive addiction treatment. Black people and Native Americans are also more likely to be incarcerated after arrest, which significantly raises overdose death risk. And people of color tend to have less access to naloxone.”
RIZE’s Mosaic website features a Memory Wall where loved ones can post photos and memorials to parents, sons, daughters, romantic partners and friends they’ve lost to opioids. It includes pages of photos and tributes (“Loving daughter, mother, our future!”; “Miss You Every Day. Heartbroken.”), and provides a powerful reminder of what’s at stake.
