News Track: Millions in Iowa’s opioid settlement fund sit idle

Background

DES MOINES — More than $56 million is sitting in a state fund, waiting to be dispersed to help Iowans who have suffered from opioid addiction — idled because of a legislative impasse.

Iowa is one of just nine states without published recommendations on opioid settlement spending, according to the National Academy for State Health Policy.

Iowa’s Opioid Settlement Fund holds money that comes to the state from national settlements with 10 companies that include opioid manufacturers, distributors and pharmacists. The settlements totaled $26 billion nationally, which will be paid out over 18 years.

Iowa was one of 47 states that participated in the lawsuit. Iowa is expected to receive roughly $325 million through 2039, according to the Iowa Attorney General’s Office.

Roughly half the money goes to state government and the other half to local governments. Per the settlement’s terms, at least 85 percent of the funds going to states and local governments must be used to treat and prevent opioid addiction.

Opioids claimed the lives of 238 Iowans in 2023, according to state figures. Iowa’s annual opioid-related deaths peaked at 258 in 2021.

The rate of Iowa’s opioid-related deaths was fourth-lowest in the nation in 2022, at 7.9 deaths per 100,000 people, according to the nonprofit health care advocacy and reporting organization KFF. The U.S. average that year was 25, and the highest mark by far was West Virginia’s 70.5 deaths per 100,000.

Iowa’s Opioid Settlement Fund, collecting the state’s share of the national settlement, had a balance of $56.3 million as of Dec. 20, 2024, according to the nonpartisan Iowa Legislative Services Agency.

Just $3.8 million has been allocated from the fund — and that was in 2021, to create a Medication Addiction Treatment Program administered by the University of Iowa Health Care.

No allocations have been made from the fund since, because state lawmakers have not reached an agreement on how the funds should be distributed — as is required by state law. Various proposals were introduced in the 2023 and 2024 sessions of the Iowa Legislature, but none gained enough support to pass into law.

What’s happened since

Key lawmakers last week told The Gazette they are working early in this year’s legislative session to reach that elusive agreement on how Iowa’s opioid settlement funds should be distributed.

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“I think the thing that I want to stress to you is, the reason we haven’t come to an agreement is we’re having discussions about how do we provide services, make them available to all Iowans who need the services,” said Rep. Gary Mohr, a Republican from Bettendorf who chairs the Iowa House’s budget committee. “How do we make them available to not just central Iowans or metropolitan Iowans, people in all counties across the state? Those are the discussions we’re having.”

Sen. Tim Kraayenbrink, a Republican from Fort Dodge who chairs the Iowa Senate’s budget committee, also expressed a sense of urgency in a statement.

“It is a priority for me to find an agreement on the opioid settlement funds with the House and get it to the governor’s desk as soon as possible,” Kraayenbrink said. “Needs for the treatment and prevention of opioid abuse are significant and these funds will benefit the people of Iowa.”

Last year, Republicans in charge of the House and Senate were unable to reach agreement on their respective proposals.

The Senate’s proposal called for 75 percent of money in the fund to be sent to the Iowa Department of Health and Human Services each year and 25 percent to the Iowa Attorney General’s Office. The agencies then would have broad control over spending the funds, but within the terms of the settlements.

The House proposal called for creating a council in the Health and Human Services Department consisting of agency heads and stakeholder experts. The council would review applications for projects and recommend grants, which would then need approval by lawmakers.

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The House proposal also included $12.5 million in funding for specific projects, taken from a proposal from Gov. Kim Reynolds.

Reynolds, a Republican, proposed a bill to fund specific projects using $20 million in opioid settlement money, but the bill did not get much attention in last year’s Legislature.

The central disagreement, lawmakers said last year, was over the need for an advisory council to administer the treatment funding. House lawmakers said that was an important piece of the proposal — to ensure oversight over how the funds are spent. Senate leaders did not think a council was needed and worried it would add unnecessary steps to the process.

Mohr and Kraayenbrink are leading the charge on negotiations between the two chambers this year.

“We’re spending a lot of time talking about, ‘How should this process work statewide so that everybody’s eligible, aware, services can be provided to everybody who needs it, and how best to do that?’ Those are the discussions we’re having with the Senate,” Mohr said. “It’s not a confrontational discussion. It’s just, ‘How best do we move forward with this?’

“Some states have not spent, in our opinion, the money wisely. We want to come up with a plan that spends the money wisely, gets to the people who needs the money, and get the best bang for the buck.”

Mohr said he is confident legislators will reach that elusive agreement this year.

“We’ll get it done this session,” he said.

This report was supplemented with information from a Gazette-Lee Des Moines Bureau article written last year by Caleb McCullough.

Comments: (515) 355-1300, erin.murphy@thegazette.com