Opioid settlement money is just not enouch to heal their community

Ashley Vanover has battled opioid addiction for half of her life. (Wall Street Journal)
Ashley Vanover has battled opioid addiction for half of her life. (Wall Street Journal)

Summary

Payments to thousands of communities are welcome but are insufficient to deal with the scars of record overdoses.

A detox center. Aid for an overflowing jail. An extra detective’s salary. These are a few of the things people in Whitley County, Ky., would like to fund with their small share of billions of dollars in settlement money from companies accused of fueling the opioid crisis.

But county leaders are confronting a dispiriting reality: The funds cover a fraction of their wish list. Some of their projects likely aren’t even eligible because of confusion over restrictions on how the money can be used. As a result, Whitley County’s funds are sitting unspent.

“This community has been so damaged over the years, the money is not going to come close to completely healing all the problems that were created," said Pat White Jr., the county’s judge-executive, a position akin to mayor.

Officials around Appalachia are reaching similarly underwhelmed assessments of the potential for settlement funds to help their constituents. Meanwhile, the opioid crisis—which started with pain pills and is now fueled by fentanyl—continues killing at a record pace.

National settlements with companies including Johnson & Johnson, Teva and Cardinal Health are slated to pay more than $50 billion over many years. The money is divided among thousands of jurisdictions, and locals say the portions trickling down to some of the hardest-hit communities—including poor, rural areas in the eastern U.S.—are a feeble match for the scale of the problem.

In 2017, when fatalities were significantly lower, costs nationwide topped $1 trillion, according to a Centers for Disease Control and Prevention analysis. In Kentucky, the estimated cost from deaths and lives undermined by addiction that year exceeded $24 billion. Per-capita costs there were among the nation’s highest.

Kentucky is expected to receive about $900 million in settlement funds, with half administered by the state and half going to local governments. State law specifies a long list of permissible expenditures, many aimed at treatment and recovery. Some areas are more restricted—such as law enforcement, which is eligible for funding aimed at education and emergency response, but not, say, narcotics investigations.

Floyd County, Ky., which has one of the nation’s highest fatal-overdose rates, has received roughly $1 million so far in settlement money—“a drop in the bucket" compared with what the opioid crisis has cost the community, said Robbie Williams, the judge-executive.

“We have so many unmet needs, we really don’t know where to start," he said.

Some organizations want funding for mental-health services, but Williams worries giving to one group will raise expectations from others. He wants to devote funds to drug courts and inmate training programs at the jail, yet isn’t sure such projects qualify for settlement money.

The county has allocated one-fifth of the funds to an opioid-awareness program. It isn’t spending more until Williams and his colleagues figure out what expenditures are allowed.

Some counties are trying to extend the reach of their settlement funds by pooling them with neighbors for bigger regional projects. Others are supplementing settlement money with other funding sources.

In Dickenson County, Va., officials are allocating $250,000 of roughly $330,000 in settlement funds received thus far for the rural area’s first residential treatment facility. The project’s price tag is $7.7 million, so the remainder is coming from sources including a loan from a regional economic development authority.

Whitley County, with a fatal-overdose rate among Kentucky’s highest, has no inpatient recovery program, few outpatient ones and a smattering of sober-living homes.

Whitney Wynn, a director at the Horizon Health outpatient facility, wants to establish the area’s first detox facility. Ideally, she said, such a center could send patients to a residential treatment site. But the settlement money wouldn’t cover both projects.

“We’re doing our best to fill the gap," Wynn said.

A wall in the lobby of Horizon’s Williamsburg, Ky., location displays photographs of six residents who have died of overdoses since January. “More than just a number," the caption reads.

Three were relatives of Ashley Vanover, 35 years old, a patient there who has battled opioid addiction for half her life. “The main problem here is, where can you get the help?" she said.

White, the judge-executive, said he and colleagues have discussed using a chunk of the $867,000 in settlement funds the county has gotten so far to help establish the area’s first residential treatment center. But at a recent training on the funds, White said, he heard the money couldn’t be used for a facility that receives Medicaid money. County officials paused the plan, he said.

Other ideas have stalled, too. Whitley County Sheriff William Elliotte, whose 10-person force regularly handles drug-related calls, said he discussed with county leaders the possibility of hiring a new detective, but they concluded the proposal would run afoul of the law.

Jason Wilson, the county jailer, said his 184-bed detention center is usually overflowing with about 300 inmates, largely because of the drug crisis, but that his understanding is that settlement money can’t be used to address the crunch.

White favors putting off action. He wants to get advice on how the funds are meant to be spent and see how other communities spend their share. Whatever the county ends up doing, he said, it won’t compensate for the damage drugs have inflicted.

“I don’t think we’ll ever fully recover," White said.

Write to Arian Campo-Flores at arian.campo-flores@dowjones.com and Jon Kamp at Jon.Kamp@wsj.com

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