Fighting the Epidemic:

How Penn State supports Pennsylvania’s response to the opioid crisis

Overdoses have killed more than 900,000 people in the United States since 1999, according to the United States Centers for Disease Control. Eighty-two percent of those deaths were related to synthetic opioids, which research shows have been over-prescribed for pain management. Multiple legal settlements showed that dishonest and illegal practices by companies that make and distribute synthetic opioids fueled the opioid epidemic.

Around six years ago, Dennis Scanlon, director of the Center for Health Care and Policy Research and distinguished professor of health policy and administration, was sitting at his office desk when the phone rang. The call was from a member of the Florida Attorney General’s office. Florida—along with Pennsylvania—was part of a 46-state lawsuit against pharmaceutical manufacturers and distributors for their role in creating the opioid epidemic in the United States. Attorneys General nationwide were looking for experts on related topics and many reached out to Scanlon because of his extensive research on the economics of health care and health policy.

Scanlon assembled a team of experts from around Penn State. They worked to quantify the opioid epidemic’s economic impact on the child welfare system, newborn childcare, the labor market, Medicaid, and the criminal justice system. Together, they published research and compiled a report that quantified the harm that had been caused by the actions of the companies. A representative of the Attorneys General told Scanlon that the report generated by Penn State—along with research from other universities—was foundational in the process of reaching a legal settlement.

To settle this lawsuit, four pharmaceutical companies and three distributors reached a $21 billion settlement with the 46 states’ Attorneys General in early 2021. In contrast to the prior national tobacco settlement, the opioid settlement dictated that the funds would be used strictly to abate the opioid crisis that was fueled by the companies’ actions. Pennsylvania, which was hit particularly hard by the opioid epidemic, was awarded $1.07 billion, to be paid over 18 years. To ensure that the money was used to address relevant problems in each locality across the state, 70% of the settlement funds were designated to be spent at the county level.

Scanlon’s involvement in the settlement research led to an additional request from Pennsylvania in August of 2021. The Commonwealth asked him to assemble another team of researchers to develop a mechanism to fairly divide the more than $1 billion opioid settlement among Pennsylvania’s counties to most effectively combat the opioid epidemic.

Any formula used for distributing funds had to be sensitive to stakeholder opinions and needs. The researchers’ first formula relied heavily on overdose-death statistics. That formula was less favorable to some counties because it did not account for costs related to overdoses where the patient may not have died. In response, the researchers incorporated data on the amount of naloxone distributed in each county and the number of overdose-related hospitalizations.

The researchers also discovered that they had to consider how the allocation formula would affect both rural and more populous urban counties. For the smallest counties, the initial formula would have generated allocations of just a few hundred thousand dollars over the course of 18 years. Even for a small county, this amount of money would probably be insufficient to do any meaningful work to abate the opioid problem. For that reason, the final allocation formula guaranteed that every county received a minimum amount of money, ensuring that smaller rural counties receive sufficient funds to expand prevention and treatment in their communities.

Once the adjustments were made, all counties agreed to the proposed funding model. The distribution formula created for Pennsylvania’s settlement will apply to any future settlements in the state against other defendants. Scanlon believes that other settlements are likely to be reached in the next few years.

When the model was approved, the Commonwealth created the Pennsylvania Opioid Misuse and Addiction Abatement Trust to distribute the funds over the next 18 years. Distribution of funds began in September of 2022.

Supporting Laws that Prevent Child Abuse

Another area where Penn State works to support evidence-based policy is in the area of child abuse prevention. Researchers in the Center for Safe and Healthy Children work with legislators in order to improve the lives of children across Pennsylvania and the nation.

Implementing and evaluating solutions to the crisis

Scanlon has continued his work by meeting with the Pennsylvania Opioid Misuse and Addiction Abatement Trust in 2023, and he is excited to further support the state’s response to the opioid crisis. Scanlon is now working with an even larger set of researchers at Penn State, including those affiliated with and supported by the Social Science Research Institute and the Consortium on Substance Use and Addiction, clinical and social scientists, and researchers from other colleges. This team will work to provide support to counties as they design their opioid abuse abatement programs. The collaboration also includes colleagues from the University of Pittsburgh and Temple University.

As different programs to prevent opioid abuse or to treat substance use are deployed across the state, Penn State researchers plan to monitor the programs and evaluate their effectiveness. In this way, the quality of substance misuse prevention and treatment everywhere can be improved.

“At each step along the way, Pennsylvania’s work to address the opioid crisis is leveraging the expertise and impartiality of researchers at Penn State, the state’s land-grant institution,” Scanlon said. “Our team has worked quickly and directly with counties, municipalities, legal counsels, Attorneys General Offices, the state’s opioid trust, and other stakeholders. Policy can play a huge role in building a healthier world, and Penn State will continue to work hard to make a healthier future become reality.”