Over $50 billion in opioid settlements will flow to states into the 2030s. What reaches providers depends on local planning and procurement.
Key Takeaways
- The spending lag: Nearly half of New Mexico’s counties, and most of its cities, had spent nothing from their opioid settlement allocations after three years, a state audit found.
- The rules on the money: The distributor deal reserves the large majority of payments for remediation, and its approved-use list covers most treatment and recovery services.
- The capacity problem: Local officials blamed too few treatment organizations to fund and doubts about paying for programs once the settlement money stops.
- The provider opening: Foundation grant cycles, county solicitations and state councils are the practical entry points for treatment organizations seeking settlement dollars.
The New Mexico Office of the State Auditor gave its July 15 report an unadorned title, Transparency Report 2026-01, Opioid Settlement Expenditures by New Mexico Local Governments. The findings were similarly plain. Of the 33 counties and 12 municipalities that had received opioid settlement payments, 15 counties and seven municipalities had reported no expenditures through June 30, 2025, the end of the three fiscal years the office reviewed. Local governments had received roughly $110 million and reported spending about $15 million. The places reporting nothing were predominantly rural.
New Mexico is also one of three states, with Arizona and Colorado, where overdose deaths rose 10 percent or more in 2025, according to provisional federal data. Its local governments described their obstacles in practical terms. Counties most often cited a lack of qualified addiction service providers, and cities worried about who would pay to continue programs once settlement money ran out, as KOB summarized the report and its survey. For treatment organizations, both answers describe a supply constraint, and both point toward a question the settlement era has not answered consistently: how the money reaches the organizations that deliver care.
How Much National Opioid Settlement Money Is Moving
The national agreements began with the 2021 settlements involving the three largest pharmaceutical distributors and Johnson & Johnson. Under the terms laid out in an executive summary maintained by the Plaintiffs’ Executive Committee, the distributors will pay up to $21 billion over 18 years and Johnson & Johnson up to $5 billion over no more than nine years. A second wave followed with Teva, Allergan, CVS and Walgreens, whose agreements totaling $17.3 billion were finalized in June 2023, as Wisconsin’s Attorney General announced. Walmart and Kroger settled separately, and State Attorneys General describe the national total as more than $50 billion.
Purdue Pharma’s contribution arrived last. Its $7.4 billion bankruptcy plan, funded largely by members of the Sackler family, became legally effective on May 1, 2026, when the company dissolved, according to Connecticut Attorney General William Tong, whose office said the state expected its first payment in the fall. When the plan was confirmed in November 2025, Purdue said the Sacklers would contribute up to $6.5 billion to $7 billion, beginning with $1.5 billion on the effective date, and that a separate pool of up to $865 million would compensate individual victims. Most of the remainder flows to state and local governments through abatement trusts, which adds another set of distribution rules on top of the national agreements. Payments under the various agreements will continue into the late 2030s, giving settlement money a longer horizon than most grant streams in substance use treatment.
Exhibit E and the Rules on Opioid Remediation Spending
The money comes with conditions. Under the distributor agreement, at least 85 percent of payments over the life of the settlement must go to opioid remediation, according to a summary for localities prepared by Virginia’s Office of the Attorney General, and states that fall short can see their payments reduced. The definition of remediation is broad. Exhibit E to the agreements provides a non-exhaustive list of approved uses and identifies core strategies that include naloxone distribution and medication treatment for people who are uninsured or whose insurance does not cover the needed service. When the distributor deal was announced, Connecticut’s Attorney General described Exhibit E to state legislative leaders as covering naloxone, medication treatment, expanded warm hand-off programs that link people from emergency care into treatment, prevention, and education, training and research. For a treatment provider, that breadth means most core clinical and recovery services qualify, and the harder question is which local body controls the decision.
States layer their own rules on top. California requires participating local governments to spend at least half of their abatement account funds on designated high-impact activities and to expend or encumber funds within five years of receipt, or seven years for capital projects, with administrative costs limited to 10 percent of the amount allocated to a given activity, under a 2026 overview from the Department of Health Care Services. Timelines like these matter to providers because they set how quickly a county must commit money and how long a funded program can expect support.
Why Opioid Settlement Funds Stall Before Reaching Providers
New Mexico’s settlements will ultimately total more than $920 million, with more than $344 million designated for local governments, per the same outlet’s summary, so the three years under review cover only the opening stretch of a long schedule. Fewer than half of the 38 local governments that responded to New Mexico’s survey had a formal written plan for the money, KOB reported. The report’s examples show how local capacity shapes spending. Albuquerque and Bernalillo County, which formed a partnership to improve efficiency, had spent about $10 million of roughly $60 million, Source NM reported. Roosevelt County and four neighboring eastern counties pooled their funds in 2022 to build a regional behavioral health facility in Clovis, and a county commissioner told Source NM the project stalled amid rising construction costs and the difficulty of finding a provider to operate it.
State accounts accumulate too. North Dakota’s Department of Health and Human Services told its opioid settlement advisory committee in February that the state fund held a balance of about $18.9 million as of December 2025, against expenditures of about $7.6 million from July 2023 through June 2025 and $1.35 million in the second half of 2025. A balance is not evidence of misuse, and some reflects deliberate multiyear planning. It does show that a meaningful share of settlement money is waiting for a vehicle.
Where Treatment Providers Enter the Opioid Settlement Process
Ohio built a dedicated channel. The OneOhio Recovery Foundation, a nonprofit created by state and local leaders to distribute 55 percent of Ohio’s distributor settlement funds, opened Regional Grant Cycle 2 in January with up to $45.7 million available and a funding inquiry window running from January 14 to February 11, 2026. Its first cycle distributed more than $45 million to over 240 projects, including recovery housing, treatment expansion, post-overdose outreach and behavioral health workforce initiatives, according to a release from the Ohio House of Representatives.
Settlement grants arrive with reporting duties resembling a small federal award. North Dakota’s grantees file monthly reports, and the totals from August through December 2025 illustrate the scale of a grant program in a small state: 32,922 people reached through prevention efforts, 457 naloxone kits distributed, 334 referrals for additional services, 112 people served by peer support and 39 who received treatment services. Providers handling identifiable substance use records in that reporting also operate under the tightened 42 CFR Part 2 regime that took effect in February. The more durable challenge is sustainability, since settlement grants are time-limited and most treatment programs eventually need a payer. A settlement-funded start paired with a Medicaid or CCBHC reimbursement pathway is sturdier than a grant treated as permanent revenue, and settlement dollars fit most naturally around services insurance covers poorly, such as peer recovery support and medication therapy for the uninsured, while the reimbursement gap that limits such services in insurance-funded care explains why the fit is so natural.
Reporting and Accountability for Opioid Settlement Dollars
New Mexico’s auditor recommended that local governments develop and review spending plans and coordinate regionally where capacity is thin, and asked the Legislature to consider minimum public reporting requirements, KOB reported. Lawmakers convene in January. Purdue’s first distributions are expected this fall, and the national payments will keep arriving on their fixed schedules whether or not the plans on the receiving end are ready. That leaves treatment providers with a task that has little to do with lobbying for more money: finding the county, foundation or council that already holds some and needs a place to put it.
