Every state in the country is currently deciding how to spend a historic pool of opioid settlement money. In one of the largest single awards yet, New York Attorney General Letitia James secured $7.4 billion from Purdue Pharma and the Sackler family — money explicitly meant to remediate the harm the opioid crisis caused. That harm didn’t stop at the person who became addicted. It moved into their household, and often into their children’s lives.
So far, most settlement dollars haven’t followed it there.
Where the money has gone
Across the country, opioid settlement spending has clustered around a familiar set of priorities: jail- and community-based Medication-Assisted Treatment (MAT), naloxone (Narcan) distribution, and public-safety-driven overdose prevention. These are worthwhile investments that save lives.
But they largely treat individuals — often adults cycling through corrections or emergency systems — not families. Almost none of this funding has been designed around pregnant and parenting mothers and fathers trying to stay together with their babies, toddlers, and young children while getting well.
The population treatment dollars are missing
The child welfare data on this is stark. According to the National Center on Substance Abuse and Child Welfare, more than half of the children under age five who entered foster care in the U.S. in 2021 were removed at least in part because of a parent’s alcohol or drug use.
Stated simply, the single largest identifiable driver of foster care entry for our youngest, most developmentally vulnerable children is parental substance use — and it has not been treated as a treatment priority. The dollars set aside to remediate the opioid crisis have rarely reached the families where that crisis is now deciding whether a baby stays home or enters state custody.
The trend over time tells the same story. Child Trends’ analysis of federal AFCARS data shows the share of foster care entries tied to parental drug use climbed from 22 percent in 2007 to 36 percent in 2017, then largely leveled off — holding between 33 and 36 percent through 2023. Total foster care entries have declined in recent years, but parental drug use hasn’t faded as a driver alongside that decline: it’s remained a factor in roughly one in three cases for nearly a decade. This isn’t a momentary spike to react to — it’s a persistent, load-bearing share of the caseload the system has been carrying for years without treatment dollars catching up.
This isn’t a child welfare footnote. Research ties parental substance use not only to foster care involvement but to housing instability more broadly — two systems that already struggle to talk to each other, compounding risk for the same families.
A policy window is opening
There’s real reason for optimism. A recent Imprint article highlights work from Alex Adams pushing to make methadone and buprenorphine — two of the most effective medications for opioid use disorder — reimbursable under Title IV-E and Medicaid. That’s a meaningful lever: it starts building the financing infrastructure family-centered treatment needs to scale, separate from settlement dollars entirely.
Put those two things together — a one-time infusion of settlement money and a shifting reimbursement landscape — and there’s a real opening to fund something that hasn’t existed at scale: treatment designed for parents and their young children, together, before separation happens rather than after.
What it will take
None of this happens by default. Settlement funds are already being allocated, jurisdiction by jurisdiction, often by councils with no child welfare representation at the table. Redirecting even a portion of that money toward family-based treatment will require:
- A clear, evidence-backed case connecting settlement dollars to child welfare outcomes, housing stability, and long-term cost avoidance
- The right advocates and levers — state settlement councils, child welfare directors, and Medicaid/Title IV-E policy leads all need a seat at the table, not just corrections and public health
- Models worth replicating — identifying jurisdictions already doing this well, so other states aren’t starting from a blank page
The opioid settlements were built on the premise that money should follow harm. Right now, it’s following the crisis backward — into corrections and emergency response — instead of forward, into the households where the next generation’s outcomes are actually being decided. That’s a solvable problem, but only if child welfare shows up to solve it.
Uma Ahluwalia is the Director of Leapp Strategies, LLC.