A Tennessee County Misuses Opioid Funds

Over the past two years, rural Greene County in northeastern Tennessee has collected more than $2.7 million from regional and national settlements with opioid manufacturers and distributors. But instead of helping people harmed by addiction, county officials are finding other ways to spend it.

They have put $2.4 million toward paying off the county’s debt and have directed another $1 million arriving over more than a decade into a capital projects fund. In March, they appropriated $50,000 from that fund to buy a “litter crew vehicle”—a pickup truck to drive inmates to collect trash along county roads.

“It’s astounding,” said Nancy Schneck, a retired nurse who has seen addiction infiltrate the community, where employers avoid drug testing for fear of losing too many employees and mental health crises and homelessness are rampant. She wants to see the money go toward mental health and addiction treatment. Why can’t county leaders “see treating some people and maybe getting them out of this cycle might be advantageous?” she said.

In 2021, the latest year for which comparable data is available, Greene County’s rate of drug overdose deaths topped state and national figures.

But Mayor Kevin Morrison said the county has borne the costs of the opioid epidemic for years: It has funded a beleaguered sheriff’s office, improved the jail—which is packed with people who’ve committed addiction-related crimes—and supported a drug court to divert some people to treatment. It has also suffered indirect costs of the crisis: people dropping out of the workforce due to addiction, schools and welfare services caring for more children who’ve experienced trauma, and some taxpayers leaving the county altogether. Addiction is not the sole reason for Greene County’s economic woes, but it has contributed to more than $30 million of debt.

“We’ve been dealing with this crisis for quite some time, but nobody wants to pay the bill as it comes,” Morrison said. “So when these funds are made available, then we are paying bills that have been due for quite some time.”

The debate in this Appalachian county is reverberating nationwide as state and local governments receive billions of dollars from companies that made, distributed, or sold opioid painkillers, like Johnson & Johnson, Cardinal Health, and CVS. The companies were accused of fueling the overdose epidemic, and the money is meant to remediate that harm. About $3 billion has already landed in state, county, and city coffers, and about $50 billion more is expected in the coming decade and beyond.

States are required to spend at least 85% of the money on opioid-related programs, but KFF Health News’ ongoing investigation into how the cash is used —and misused—shows there is wide interpretation of that standard and little oversight.

That restriction didn’t apply to the money Greene County moved to its capital projects fund.

In many rural communities, which have been struggling to pay addiction-related costs for decades, local officials justify using the settlement funds to reimburse past expenses. Most of Tennessee’s 95 counties are in significant debt, which can present difficult choices about how to use this money, said Robert Pack, co-director of East Tennessee State University’s Addiction Science Center.

Still, he and many advocates hope the settlement funds are spent on tackling the current crisis. After all, more than 200 people nationwide are dying of overdoses each day. Investing in treatment and prevention can save lives and protect future generations, they say.

“There is no good excuse to sit on the funds or put them into a general fund,” said Tricia Christensen, policy director for the nonprofit Community Education Group. The organization is tracking settlement spending across Appalachia, which Christensen called the epidemic’s ground zero. “These dollars should be used to support people who have been most impacted by the overdose crisis.”

Nationally, there has been little oversight of the settlement dollars. President Joe Biden’s administration pledged to ensure the funds went toward tackling the addiction crisis, but has taken little action. Accountability at the state level varies.

In Tennessee, 15% of the state’s opioid settlement funds are controlled by the legislature and another 15% by local governments. Those two buckets have few restrictions.

The other 70% is controlled by an Opioid Abatement Council, which has more rigorous standards. When the council, which must give 35% of its funds to local governments, recently distributed more than $31 million to counties, it required the funds be spent on a list of approved interventions, such as building recovery housing and increasing addiction treatment for uninsured people.

“I can guarantee we’re going to bird-dog” those funds, said Stephen Loyd, chair of the council and a physician in recovery from opioid addiction. If counties use them for unapproved purposes, the counties will not receive future payouts, he said.

Greene County’s reimbursement of its capital projects fund comes from its own pot — the 15% that is controlled entirely by local governments.

In such cases, the public can hold officials accountable, Loyd said. “If you don’t like the way the money is being spent, you have the ability to vote.”

Local leaders are generally not being “nefarious” with these decisions, he said. They make hundreds of budgetary choices a month and simply don’t have experience with addiction or health policy to guide them in using the money.

Loyd and other local experts are trying to fill that gap. He meets with county officials and recommends they speak with their local anti-drug coalitions or hold listening sessions to hear from community members. Pack, from East Tennessee State, urges them to increase access to medications that have proven effective in treating opioid addiction.

Both men point counties to an online recovery ecosystem index, where leaders can see how their area’s resources for recovery compare with those of others.

In Greene County, for example, the index indicates there are no recovery residences and the number of treatment facilities and mental health providers per 100,000 residents is below state and national averages.

“That’s a great place to get started,” Loyd said.

Some Greene County residents want to see opioid settlement funds go to local initiatives that are already operating on the ground. The Greene County Anti-Drug Coalition, for instance, hosts presentations to educate young people and their parents on the risks of drug use. They meet with convenience store owners to reinforce the importance of not selling alcohol, cigarettes, or vaping devices to minors. In the future, the coalition hopes to offer classes on life skills, such as how to budget and make decisions under pressure.

“If we can do prevention work with kids, we can change the trajectory of their lives as adults,” said Wendy Peay, secretary of the anti-drug coalition and executive director of United Way of Greene County.

The coalition has asked the county for settlement funds but has not received any yet.

Nearby in Carter County, a new residential treatment facility is taking shape at the site of a former prison. At least seven counties, cities, and towns in the region have committed a combined $10 million in opioid settlement funds to support it, said Stacy Street, a criminal court judge who came up with the idea. Greene County is among the few local governments that did not contribute.

It will be part of the region’s drug recovery court system, in which people with addiction who have committed crimes are diverted to intensive treatment instead of prison.

Currently there are no long-term residential facilities in the area for such patients, Street said. Too often, people in his court receive treatment during the day but return home at night to “the same sandbox, playing with the same sand-mates,” increasing their risk of relapse.

Street said the new facility will not offer medications to treat opioid addiction—the gold standard of medical care—because of security concerns. But some patients may be taken to receive them off campus.

Morrison, the Greene County mayor, said he worried about contributing to the facility because it is a recurring cost and the settlement funds will stop flowing in 2038.

“There’s been great pressure put on local entities like Greene County to try to solve this problem with this limited amount of funding,” he said, when “the federal government, which has the ability to print money to solve these problems, is not in this business.”

The county is still deciding how to spend nearly $334,000 of settlement funds it recently received from the state’s Opioid Abatement Council. Morrison said they’re considering using it for the anti-drug coalition’s education efforts and the county drug court. Given the guidelines from the abatement council, these funds can’t be used to pay old debts.