Appendix C

Mental Health and Substance Use Disorder Prevention Financing Landscape Analysis

Tami L. Mark, Ph.D., M.B.A.
RTI International
TMark@RTI.org
July 30, 2024

TABLE OF CONTENTS

MENTAL HEALTH AND SUBSTANCE USE DISORDER PREVENTION FINANCING LANDSCAPE ANALYSIS

Table of Contents

INTRODUCTION

Background

Purpose of the paper

Methods

FEDERAL SPENDING ON BH PREVENTION

Federal Spending Overview

Discretionary Versus Mandatory Funding

Prevention and Public Health Fund

Total Federal Spending on Prevention

Total Federal Spending on SuD Prevention

Total Federal Spending on MH Disorder Prevention

Total Federal Spending on BH (MH/SUD) Prevention

Medicaid

Medicare

SAMHSA

CDC

ACF

HRSA

ACL

Department of Education

STATE SPENDING BH PREVENTION

State Financing Overview

State Spending on BH Prevention

Expanding State Spending on BH Prevention Through Earmarked Taxes

Expanding State Spending on BH Prevention Through Settlement Funds

PRIVATE SPENDING ON BH PREVENTION

Charitable/Nonprofit Organizations

Private Insurance

Employers

CONCLUSIONS

REFERENCES

TABLES

TABLE 1 Federal government total outlays, fiscal year 2023

TABLE 2 Federal Agency’s Total Outlays, FY 2023 (millions)

TABLE 3 Federal substance use disorder prevention funding, fiscal year 2023 (millions)

TABLE 4 Federal mental health disorder prevention funding, fiscal year 2023 (millions)

TABLE 5 Federal substance use and mental health disorder prevention funding, fiscal year 2023 (millions)

TABLE 6 Department of Health and Human Services total outlays, fiscal year 2023 (millions)

TABLE 7 SAMHSA substance use disorder prevention funding, fiscal year 2023 (millions)

TABLE 8 SAMHSA total mental health funding and mental health disorder prevention funding, fiscal year 2023 (millions)

TABLE 9 Description of SAMHSA’s major mental health programs (treatment and prevention focused)

TABLE 10 CDC total funding and mental health/substance use disorder prevention funding, fiscal year 2023 (millions)

TABLE 11 CDC substance use prevention funding, fiscal year 2023 (millions)

TABLE 12 CDC budget for mental health disorder prevention funding, fiscal year 2023 (millions)

TABLE 13 Administration on Children and Families mental health prevention funding, fiscal year 2023 (millions)

TABLE 14 HRSA substance use disorder prevention funding, fiscal year 2023 (millions)

TABLE 15 HRSA mental health disorder prevention funding, fiscal year 2023 (millions)

TABLE 16 State primary substance use disorder prevention spending, 2023 (millions)

TABLE 17 State mental health disorder prevention spending, 2023 (millions)

Introduction

BACKGROUND

Mental health and substance use disorders (MH/SUDs) are disabling conditions that drive a sizable proportion of morbidity and mortality in the United States and worldwide. By many indications, MH/SUD in United States have worsened over the past 2 decades:

• Deaths from suicide increased from 10.4 per 100,000 in 2000 to 13.5 in 2020 (Ehlman et al., 2022).
• Drug overdose deaths increased from 6.1 per 100,000 in 1999 to 28.3 in 2020 (Hedegaard, Miniño, and Warner, 2020).
• Alcohol-related deaths increased from 7.9 per 100,000 in 2012 to 13.5 in 2022 (Saunders and Rudowitz, 2024).

The increase in deaths from suicide, drugs, and alcohol is one of key drivers of the U.S. decline in life expectancy in recent years (Arias et al., 2022).

The prevalence of MH/SUD is high and has increased for some conditions and populations:

• In 2022, 48.7 million people aged 12 or older (17.3 percent) had an SUD in the past year, including 29.5 million who had an alcohol use disorder (AUD), 27.2 million who had a drug use disorder, and 8.0 million who had both (SAMHSA, 2023a).
• Among adults aged 18 years and older, 15.4 million (6 percent) had a serious mental illness (SMI) in 2022.
• The percent of adolescents reporting ever getting drunk was 26.4 in 2020 (Johnston et al., 2021).
• The percent of adolescents reporting using illicit drugs was 34.7 in 2020 (Johnston et al., 2021).
• Major depression among adolescents increased from 8.1 percent in 2009 to 15.8 percent in 2019 (Daly, 2022).
• Anxiety among adults increased from 5.1 percent in 2008 to 6.6 percent in 2018 (Goodwin et al., 2020).

Spending on MH/SUD treatment more than tripled, from $40 billion in 2000 to $140 billion in 2021, driven by a combination of increased prevalence, use, and cost of care (BEA, n.d.).

These trends require a new examination of the nation’s MH/SUD prevention infrastructure and financing.

PURPOSE OF THE PAPER

This paper scans the funding landscape for MH/SUD prevention, also referred to collectively as “prevention of behavioral health (BH) disorders.” It describes the amount of funding for BH prevention activities at the federal, state, and local levels and through private insurance, charitable/not for profit organizations, and employers. The paper also discusses options to generate sustained and adequate funding for the prevention infrastructure.

METHODS

Defining MH/SUD

This paper relies on the definitions and criteria in the American Psychiatric Association Diagnostic and Statistical Manual of Mental Disorders Version 5 (DSM-V), save that it excludes dementias, developmental disabilities, and tobacco use.

According to the DSM-V, BH disorders differ from “normal” feelings, thoughts, moods, and behaviors when they are intense, long lasting, and/ or frequent and interfere with functioning and health. For example, unlike normal feelings of sadness, common symptoms of depression include an inability to concentrate and carry out usual activities, disrupted sleep and eating, and thoughts of suicide.

From a population perspective, identifying what is and is not an MH/SUD is complex. No biological markers or tests can determine if someone has a mental illness, as is possible in diabetes, hypertension, or HIV, for example. When thinking, feelings, moods, and behavior should be determined to be “pathological” as opposed to “normal” is not clear cut. Epidemiologic surveys use different assessments and criteria to determine whether someone has an MH/SUD. For example, the 2022 Substance Abuse and Mental Health Administration (SAMHSA) National Survey of Drug Use and Health (NSDUH) used three measures of mental illness: “any mental health illness,” “serious mental illness,” “major depressive episode” (SAMHSA, 2023a). SMI is a subset of mental illness. The 2022 NSDUH classified someone with SMI based on their degree of impairment as measured by the Sheehan Disability Scale. Earlier versions of the NSDUH did not have a measure of “serious mental illness” and instead used the K6 questionnaire to measure “serious psychological distress.” Other national epidemiologic surveys, such as the Centers for Disease Control and Prevention (CDC) Behavioral Risk Factor Surveillance System (BRFSS), CDC National Health Interview Survey, and Census Pulse Survey, use different questionnaires and criteria to measure mental illness. A final challenge in determining population-level MH/SUD is that the NSDUH only captures mental health and substance use among individuals

age 12 and older. In young children, mental health conditions often present as behavioral and emotional symptoms that differ from those in adults and therefore require different diagnostic criteria.

Unlike mental illness, laboratory tests can determine whether someone is using substances. Furthermore, epidemiologic surveys, such as the NSDUH, have a longer track record of measuring population SUDs. Long-running surveys, such as Monitoring the Future, have been used to track youth use of and attitudes toward substances and can identify precursors to future SUD epidemics. Nothing similar exists for early indicators of emerging mental disorders.

This paper does not conceive of MH/SUD as global “happiness” or “well-being” as described in the World Happiness Report, for example (Helliwell et al., 2024). If BH is broadly defined as general population well-being, then it could be argued that most of federal, state, and local government spending constitutes BH prevention, such as income transfers, housing supports, public education, violence protection, and sustainability initiatives.

Defining MH/SUD Prevention Interventions

National Academies of Sciences, Engineering, and Medicine reports have called out the challenge of defining BH prevention. This paper focuses on programs that were clearly identified as aiming to prevent MH/SUD or described as preventing adverse childhood experiences (ACEs). Tertiary prevention (e.g., SUD harm reduction, such as needle exchanges and naloxone distribution) was excluded, to the extent feasible. Programs focused on preventing suicide were included, although this is arguably often tertiary prevention because it can be achieved by identifying and treating MH/SUDs. This paper’s definition of MH/SUD prevention is acknowledged to be too narrow in that it was not feasible to capture the financing for all effective programs or policies that can reduce the risk factors, given definitional

ambiguities and research gaps. Risk factors are numerous and complex (see box). Genes, biology, childhood and subsequent life experiences, relationships, and what is broadly called “environment” interact in complex ways to increase the risk for developing a MH/SUD.

MH/SUDs often have their foundation in childhood experiences. ACEs have been shown across a large body of research to be major risk factors for MH/SUD (Danielsdottir et al., 2024; Gu et al., 2022; Solmi et al., 2021; Claussen et al, 2024; Beatty et al., 2024; Norman et al, 2012). “ACEs include child abuse (emotional, physical, or sexual), child neglect (emotional or physical), and household dysfunction (domestic violence, substance abuse, mental illness, criminal activity, or parental absence)” (Gu et al. 2022). Studies are beginning to highlight possible mechanisms of action whereby trauma and ACEs increase the risk for psychiatric illness and SUD later in life, such as through alteration of immune functioning (Maayan and Maayan, 2024). Evidence-based interventions that prevent ACEs have been developed, although more research is needed (Lorenc et al., 2020). Therefore, in addition to a focus on spending on programs that are clearly described as aimed at preventing SUD, mental illness, suicide, this paper also focuses on interventions aimed at reducing the crosscutting risk factor of childhood ACEs.

Children and adults across all income levels experience MH/SUDs and ACEs (Camacho and Henderson, 2022). However, poverty places children at higher risk for ACEs, and financial shocks are associated with an increase in suicide. Therefore, reducing poverty and financial shocks could reduce ACEs and MH/SUD. Programs that subsidize low-income families and individuals (e.g., Temporary Assistance to Needy Families (TANF)) and programs that protect against financial shocks (e.g., Medicare, Medicaid, employment insurance) are highlighted in this paper but not included in the funding estimates because of the challenge in drawing a causal direct line between these programs and MH/SUD prevalence rates.

It was nearly impossible to separate spending on prevention from spending on treatment. Most federal MH/SUD prevention programs are discretionary grant programs that allow spending on a combination of prevention and treatment with no requirements or accounting for how much funding was allocated to either. If a program appeared to be primarily for treatment, it was excluded from the spending estimates, but this determination was often difficult.

As noted in the 1994 Institute of Medicine Report Reducing Risks for Mental Disorders: Frontiers for Preventive Intervention Research, sometimes, treatment can also be prevention. For example, “psychotherapy for an anxious mother of a healthy child can be conceptualized as treatment of the mother as well as prevention of later difficulties [for] the child, [and] effective treatment of a physical illness may prevent a secondary mental disorder and vice versa” (p. 24).

In general, it was easier to identify financing for substance use than MH disorder prevention for several reasons. First, the federal government has one agency that oversees its efforts to prevent and treat SUDs, the Office of National Drug Control Policies (ONCDP). Second, as noted, population surveys to monitor SUD are longer running than those to monitor MH. Third, programs described as substance use prevention generally comprised interventions that (1) reduce the availability of substances, (2) change social norms and attitudes toward substance use, (3) provide information about the effect of substances, or (4) provide skills to reduce substance use in oneself or others.

Because of resource constraints and the availability of information, this paper focuses on federal spending on prevention to a greater extent than spending by states and the private sector. Few existing resources summarize states spending on mental health treatment or prevention.

Data Sources

The primary sources were budget documents of federal agencies and summary analyses of state, private insurance, charitable, and employer spending.

FEDERAL SPENDING ON BH PREVENTION

Federal Spending Overview

As context for understanding the size of federal investment in MH/SUD prevention, it is useful to first describe total federal spending. In fiscal year 2023, outlays were approximately $6 trillion in total (23 percent of the nation’s gross domestic product) (see Table 1) (Ready, Salazar, and Verboon,

TABLE 1 Federal government total outlays, fiscal year 2023

Source: CBO (Congressional Budget Office). The Federal Budget in Fiscal Year 2023: An Infographic. (Second graphic) https://www.cbo.gov/publication/59727

2024; Department of the Treasury, n.d.a.). Medicare and Medicaid programs comprised 24 percent of 2023 total federal outlays ($1.4 trillion). The remaining main components were Social Security (21 percent), national defense (13 percent), net interest (11 percent), income security programs (7 percent), and other (8 percent) (CBO, 2024).

Table 2 describes total federal outlays by federal agency for fiscal year 2023. The Department of Health and Human Services has the largest because it oversees Medicare and Medicaid.

Discretionary Versus Mandatory Funding

About 63 percent of the federal budget is mandatory spending, 30 percent is discretionary spending, and 8 percent is interest payments on debt (Department of the Treasury, n.d.b). Primary prevention services are funded largely though discretionary mechanisms, such as block grants, as opposed to mandatory funding streams, such as Medicaid and Medicare entitlement programs. This has limited their sustainability. Funding for mandatory programs is provided directly in authorizing legislation that establishes eligibility criteria or benefit formulas and usually not limited by the annual

TABLE 2 Federal Agency’s Total Outlays, FY 2023 (millions)

Source: USA spending.gov https://www.usaspending.gov/explorer/agency (USASpending.gov, 2023)

appropriations process. Other examples of mandatory funding programs are child nutrition programs, State and Tribal Assistance Grants, Children’s Health Insurance Program (CHIP), and TANF. The advantage of mandatory funding is that it provides a sustainable funding stream, which is sometimes perceived as a disadvantage because spending can grow rapidly and be difficult to contain without legislative changes.

Funding for discretionary grant programs is determined annually through appropriations acts. Examples of among the largest discretionary programs include federal-aid highways programs, Tenant Based Rental Assistance, Education for the Disadvantaged, and the Disaster Relief Fund (White House, 2023). Discretionary grant programs vary in the extent to which the federal government directs the way the funding must be spent.

Prevention and Public Health Fund

The Prevention and Public Health Fund was established in the Patient Protection and Affordable Care Act (ACA. P.L. 111-148, as amended) to provide for expanded and sustained national investment in prevention and public health programs that were not subject to the annual congressional approval process. Fund appropriations are mandatory, meaning that the amount of funding spent each year is set in the authorizing law, which requires that it be spent on prevention, wellness, and public health activities, including prevention research, health screenings, and prevention programs.

The Prevention and Public Health Fund budget was $1 billion in 2023, a reduction from the $2 billion in the original authorizing legislations. Amendments over the years also shifted the authority for authorizing the spending from the Secretary of Health and Human Services (HHS) to Congress.

In recent years, most Prevention and Public Health Fund resources went to CDC, with smaller amounts for SAMHSA and the Administration for Community Living (ACL). In the FY 2023 appropriations, $903.3 million went to CDC (for programs addressing breastfeeding, diabetes, health care–associated infections, heart disease and stroke prevention, smoking, immunization, and lead poisoning, early child care collaboratives, epidemiology and laboratory grants, and preventive services and health care services block grants), $27.7 million went to the ACL (for programs for Alzheimer’s disease, falls prevention, and chronic disease self-management), and $12 million went to SAMHSA (for youth suicide prevention).

A Congressional Research Service analysis found that the Prevention and Public Health Fund did not result in an increase in CDC funding (a proxy for public health prevention funding in general) (CRS, 2024). The analysis noted that to increase prevention funding, Congress could consider statutorily describing what programs are eligible and creating greater oversight mechanisms to ensure the fund was achieving intended policy goals.

Total Federal Spending on Prevention

The Centers for Medicare & Medicaid Services (CMS) estimated in its National Health Expenditure Accounts that federal public health spending in 2022 was $92 billion ($208.4 billion overall with $116.4 from state sources) (CMS, 2024a). That includes disease prevention programs, epidemiological surveillance, immunization, and public health laboratories. CMS assumed that most public health spending was by the U.S. Food and Drug Administration and CDC.

Total Federal Spending on SUD Prevention

The Office of National Drug Control Policy (ONDCP), established by the Anti-Drug Abuse Act of 1988 and reauthorized by the SUPPORT for Patients and Communities Act (Public Law 115-271), is charged with developing policies, objectives, and priorities for the nation’s drug policy and coordinating across federal agencies as part of a whole-of-government approach to substance misuse, addiction, and overdose. Under 21 U.S.C. § 1701(11), “National Drug Control Program Agency” means any agency that is responsible for implementing any aspect of the National Drug Control Strategy (except for those focused on drug control activities under the National Intelligence Program or Joint Military Intelligence Program). In addition to ONDCP, these agencies include the departments of Agriculture, Defense, Education, HHS, Homeland Security, Housing and Urban Development, Interior, Justice, Labor, State, Transportation, Treasury, and Veterans Affairs and the Court Services and Offender Supervision Agency for the District of Columbia, federal judiciary, U.S. Postal Inspection Service, and AmeriCorps. In FY 2023, ONCDP oversaw a $42.5 billion budget (GAO, 2022).

The ONDCP Office of Public Health develops and oversees the federal government’s overall strategy for substance use prevention, including providing budget guidance to ensure adherence to evidence-based public health approaches (ONDCP, 2023a).

ONDCP reported that in 2023, the federal government budget for SUD prevention was $2.7 billion. Its definition of prevention includes education (e.g., programs proven to reduce the risk factors related to drug use), drug-free workplace programs, drug testing in various settings (e.g., athletics, schools, and workplaces), and other programs (e.g., family-based treatment) to prevent substance misuse and its consequences. The definition excludes screening for MH/SUD.

Table 3 describes how SUD prevention spending was allocated across federal agencies and adjusted estimates after removing spending for research, drug interdiction, and treatment and adding funding for SUD screening. ONDCP estimates that total SUD prevention funding was $2,732 million. This paper estimates that it was $1,808 million.

TABLE 3 Federal substance use disorder prevention funding, fiscal year 2023 (millions)

Source: Office of National Control Policy. National Drug Control Budget, FY 2024 Funding Highlights, March 2023. https://www.whitehouse.gov/wp-content/uploads/2023/03/FY-2024-Budget-Highlights.pdf (ONDCP, 2023a).

Approximately 80 percent of the $1.8 billion in prevention spending was for HHS, with most spending by SAMHSA and CDC. The other 20 percent was for SUD prevention programs delivered by the Departments of Defense, Education, Interior, Justice, Labor, and Transportation.

Total Federal Spending on MH Disorder Prevention

There was no equivalent estimate for MH prevention, which reflects the fact that no agency is dedicated to a “whole-of-government” response to preventing mental illness. This paper estimates that federal agencies spent $2,766 million on MH prevention (see Table 4).

Approximately 40 percent of the MH prevention spending occurred under the direction of the Administration for Children and Families (ACF) for programs aimed at preventing child maltreatment ($1,126 million). The next largest amount was spent by SAMHSA ($919 million), of which $617 million was for suicide prevention and the rest mainly aimed at children and youth. The Health Resources and Services Administration (HRSA) MH prevention spending ($517 million) went toward the Maternal, Child, and Home Visiting Program ($500 million). CDC had a variety of programs aimed at preventing suicide, domestic and sexual violence, ACES, firearm injury, and student emotional health.

Total Federal Spending on BH (MH/SUD) Prevention

Combining the $1,808 million spent on federal SUD prevention programs with the $2,766 million spent on MH prevention programs yields $4,574 million for BH prevention (see Table 5).

TABLE 4 Federal mental health disorder prevention funding, fiscal year 2023 (millions)

Source: Author calculation based on Department of Health and Human Services fiscal year, 2024, justification of estimates for Appropriations Committees.

TABLE 5 Federal substance use and mental health disorder prevention funding, fiscal year 2023 (millions)

Source: Agency Justifications for Estimates for Appropriations Committee; ONDCP, 2023 https://www.whitehouse.gov/wp-content/uploads/2023/03/FY-2024-ONDCP-CONGRESSIONAL-BUDGET-SUBMISSION-FINAL.pdf

As further context for the MH/SUD prevention spending estimates, Table 6 describes FY 2023 outlays across all HHS agencies. The total budget was $1,733 billion, with the majority ($1,593 billion) allocated to CMS. Thus, federal BH prevention spending was 0.2 percent of all HHS agencies’ budgets in 2023 (4.574/1,733).

TABLE 6 Department of Health and Human Services total outlays, fiscal year 2023 (millions)

Source: https://www.hhs.gov/sites/default/files/fy-2024-budget-in-brief.pdf

MEDICAID

Medicaid and CHIP are mandatory (entitlement) programs funded jointly by the federal and state governments to provide health coverage to low-income families and individuals. As of December 2023, 85,094,448 individuals were enrolled in Medicaid and CHIP, or 25 percent of the U.S population and 39 percent of all children (MACPAC, 2023). In FY 2022, Medicaid and CHIP spending was $853 billion.

Because of its size, flexibility, and focus on low-income children and families, Medicaid could be a robust tool for financing BH prevention interventions. However, it has been structured to only fund the delivery of narrowly defined health care services at the individual level. The federal government and states define the set of covered services within the broad outlines of Medicaid law and regulations. These services are typically defined by billing taxonomies, such as Current Procedural Terminology and revenue codes, and the credentials of the relevant professionals or health care providers. For providers to bill Medicaid, they must also be enrolled in the program. Moreover, services can only be delivered to Medicaid beneficiaries, with few exceptions described next. These legislative restrictions drive spending on health care services to people who are acutely or chronically ill and limit the ability of Medicaid to finance a broader array of effective population-based, primary MH/SUD prevention interventions. It reimburses for some prevention services if delivered by appropriately credentialed providers. “Preventive services are a benefit specified in section 1905(a)(13) of the [Medicaid law]. Medicaid regulations at 42 C.F.R. § 440.130(c) generally define [these] as recommended by a physician or other licensed practitioner of the healing arts, within the scope of authorized practice under state law, to prevent disease, disability, and other health conditions or their progression; prolong life; and promote mental and physical health and efficiency” (CMS, 2023a). To encourage coverage of preventive services, section 4106 of the ACA established a 1 percentage point increase in the Medicaid federal medical assistance applied to such expenditures to states that cover all U.S. Preventive Services Task Force Grade A and B preventive services. Health education or “counseling/anticipatory guidance/risk factor reduction interventions” are also covered if from a participating provider. Health education and counseling can be provided in a variety of settings such as clinics, homes, and schools.

States can optionally reimburse for screening, brief intervention, and referral to treatment (SBIRT) for drugs and alcohol. Federal and state agencies have made concerted efforts to increase coverage and use of SBIRT. As of 2023, 38 states covered SBIRT. Other examples of covered health education services include counseling concerning problems related to lifestyle (V69.0–V69.9), parental concerns about a child (V61.60), and spouses and partners (V61.10).

In 2020, Medicaid spent approximately $43 million on SUD screening and brief interventions. No equivalent estimate for MH screening and brief interventions was available.

The challenges of financing health education and counseling under Medicaid include that primary care clinicians only see patients sporadically (e.g., children and adolescents once during annual visits) and have limited time during visits to provide extensive counseling. Additionally, because counseling must be billed by Medicaid-participating clinicians, it is more expensive than if Medicaid allowed it to be provided by uncredentialed individuals, such as community health workers or teachers, or through public health campaigns.

Medicaid’s Early and Periodic Screening, Diagnostic and Treatment (EPSDT)

This benefit covers MH and development preventive health care screening and health education services for children under age 21 (Medicaid.gov, n.d.b.). In 2021, 34 million individuals were screened under EPSDT, or about 69 percent of those eligible (Medicaid.gov, n.d.b.). Data are not available on Medicaid spending attributable to EPSDT. In 2022, CMS issued guidance to states on how to better leverage Medicaid in general, and EPSDT specifically, to reduce BH disorders among children (CMS, 2022). CMS described in the guidance, for example, how the Massachusetts Medicaid program implemented universal BH screening of MassHealth members under the age of 21 during well-child visits, directing all primary care clinicians seeing such youth to use one of several approved screening tools (CMS, 2013).

Health Services Initiatives (HSIs)

CHIP allows states to use a limited amount of funding to implement HSIs focused on improving the health of eligible children under (§2105(a) (1)(D)(ii) of the Social Security Act. HSIs can be a broad community-wide public health initiatives that serve children regardless of income, as long as they improve the health of low-income children under 19 years who are eligible for CHIP or Medicaid (MACPAC, 2019). Eight states have established HSIs to deliver parenting education and supports, six have HSIs focused on MH/SUD services, and one has an HSI-focused on violence prevention (MACPAC, 2019). For example, New Jersey funded the Pediatric Psychiatry Collaborative to promote universal MH/SUD screening in pediatric settings and referral to services (Medicaid.gov., n.d.c.). States could expand their HSIs to include social marketing campaigns on alcohol and drug use and other population-level BH prevention interventions.

Social Determinants of Health (SDOH)

Recently, CMS provided more flexibility to states to cover health-related social needs (HRSNs, also known as SDOH) under Medicaid (Medicaid.gov, 2023). For example, as of November 2023, CMS has approved Section 1115 demonstrations in seven states that cover certain evidence-based housing and nutritional services. CMS requires that Medicaid-covered HSRN services not supplant the funding of another federal or state non-Medicaid agency and be complementary to existing social services, such as those provided by the Department of Housing and Urban Development and Department of Agriculture Supplemental Nutrition Assistance Program (SNAP). CMS also restricts the amount and type of HSRN services that can be covered under Medicaid (Medicaid.gov, 2023). For example, it can cover finding and securing housing, security deposits, application and inspection fees, utilities activation, tenancy and sustaining services, benefit program application assistance and fees, eviction prevention, and tenant rights education. However, it cannot pay for room and board. Similarly, nutrition services paid for under Medicaid may only include grocery provisions to high-risk individuals required to avoid unnecessary acute care admission or institutionalization or foods identified as “evidence-based” for persons with diabetes.

Medicaid in Lieu of Services

Medicaid managed care organizations can cover services or settings that are substitutes for services or settings covered under the state plan (known as In Lieu of Services and Settings). This is permitted if they are medically appropriate and cost effective compared with standard care (NCSL, 2023). Since 2019, states have used this flexibility to cover a variety of services, such as chiropractic treatment in lieu of physiotherapy and mobile crisis services as an alternative to inpatient psychiatric treatment (NCSL, 2023). This can only be used in Medicaid managed care if it is a coverable service or setting in the state plan or Section 1915 waiver. Therefore, it cannot be used for primary prevention activities, such as social marketing campaigns to prevent overdoses.

BH Prevention Focused on Parents

MH/SUD conditions can profoundly interfere with parenting. Children of parents with untreated MH/SUD are at higher risk for developing MH/SUD (Klaman et al., 2017; Morales et al., 2023). Medicaid covers a wide array of effective MH/SUD treatments. States have used various Medicaid program flexibilities to deliver parenting skills training and other BH-focused interventions in homes, such as stress management, intimate

partner screening, and education (Thompson and Hasan, 2023). Some states require the use of recognized, evidence-based models to receive in-home BH reimbursement, such as Nurse-Family Partnership, Parents as Teachers, and Healthy Families America (Thompson and Hasan, 2023).

Congress and federal agencies are encouraging greater coordination between Medicaid and child welfare to prevent family separations and child maltreatment and neglect (MACPAC, 2015). However, recent research finds large gaps in receipt of Medicaid funding BH services among parents with MH/SUD involved in the child welfare program (Mark, 2024b). It has also shown large racial disparities in receipt of Medicaid-financed MH/SUD services among caregivers of children identified by child protective services (Mark, 2024a). For example, an analysis of data from two states found that White versus Black caregivers with SUD and Medicaid who were involved child protective services were much more likely to have received Medicaid-funded counseling (43 vs. 20 percent) or an SUD medication (43 vs. 11 percent).

Because of the known connection between perinatal maternal depression and children’s MH, there has also been a growing focus on identifying and treatment postpartum depression among Medicaid beneficiaries. (Mandl et al., 2024). Some states cover maternal depression screening as part of a Medicaid well-child visit (Wachino, 2016).

School-Based Medicaid Funding

States and schools have long relied on Medicaid to fund covered services provided to children with disabilities under the Individuals with Disabilities Education Act (IDEA). Although schools can deliver Medicaid-funded MH/SUD screening and treatment services to all students with Medicaid, not just children eligible under IDEA, only 16 states have plans that allow for reimbursing services to other Medicaid-eligible students (ED, 2024; Medicaid.gov, n.d.). CMS and the Education Department are encouraging states and schools to expand their offering of school-based Medicaid services (Tsai, 2023). CMS recently provided schools with a new flexibility on billing and documentation to help ease the administration of Medicaid services for local education agencies, such as billing on a per-enrolled-student per-month bundled “capitated” rate rather than per service. The new flexibility also allows states to establish qualifications for school-based providers that differ from those of non-school-based providers of the same services. For example, if a school-based provider is qualified under state or local law to counsel any child, the state cannot impose additional requirements as a condition for reimbursement for a Medicaid beneficiary. The recent CMS guidance also notes that allowable administrative activities can include any cost of

general public health initiatives made available to all persons, as long as the activities related to assisting Medicaid-eligible students are specifically identified (CMS, 2023a, p. 74). Research demonstrates that school-based interventions can prevent drug use, depression, and anxiety, although the effect sizes may be small, and questions remain about how best to target these (Faggiano et al., 2014; Werner-Seidler et al., 2021). Encouraging more states to expand their Medicaid programs to take advantage of the new flexibilities to provide school services to all children could increase the financing for BH prevention.

Population-Based Quality Measures

One way to incentivize Medicaid managed care organizations and providers to focus on preventing BH conditions is to create and hold them accountable for population-level BH measures (CMS, 2021a). CMS requires state Medicaid programs to report on approximately 35 adult measures, including 11 focused on BH (CMS, n.d.), which all address service delivery. To encourage greater focus on MH/SUD prevention by Medicaid managed care plans, CMS could create quality measures that focus on population health, such as the percentage of a state’s population that died by suicide or had depression. Population-based MH/SUD measures are already collected in the NSDUH and BRFSS. Using these measures could shift Medicaid program focus to preventing BH disorders rather than just delivering treatment (CMS, 2023a; Wong, 2024). States could encourage Medicaid managed care plans to track the health of their populations and provide incentives for reducing the incidence of or risk factors for MH/SUD.

1115 Demonstration Programs

CMS successfully reduced heart attacks and strokes in its Million Hearts demonstration program, in which providers received supports and incentives to reduce cardiac risk among high-risk Medicare beneficiaries (CMS, 2023b). A similar model could be piloted to prevent BH conditions, such as offering managed care plans flexibilities and incentives to prevent youth from developing anxiety and depression.

Medicare

Medicare covers medical care services to those aged 65+ and disabled persons, including those with end-stage renal disease. Medicare will reimburse for preventive services determined to be effective by its National Coverage Determination process. For BH prevention coverage, Medicare will reimburse for alcohol and drug misuse screening and counseling and once-a-year depression screening (CMS, 2021; Jacques et al., 2011; CMS,

2024b). It does not cover primary prevention, such as social marketing campaigns. Medicare spending was $944.3 billion in 2022 and approximately $1.4 million on SUD screening in 2020 (Mark, 2024). As noted for Medicaid, Congress could mandate that CMS conduct a demonstration to allow Medicare greater flexibility to offer a greater range of primary prevention interventions aimed at preventing BH conditions, using population-based quality measures, such as the percentage of Medicare beneficiaries with depression, anxiety, or alcohol use disorders.

SAMHSA

SAMHSA is the HHS agency that leads public health efforts to advance the BH of the nation and improve the lives of individuals living with MH/SUD and their families. It has five priority areas: (1) preventing substance use and overdose, (2) enhancing access to suicide prevention and mental health services; (3) promoting resilience and emotional health for children, youth, and families; (4) integrating behavioral and physical health care; and (5) strengthening the BH workforce.

SAMHSA is organized into four main divisions: the Center for Mental Health Services, Center for Substance Abuse Treatment (CSAT), Center for Substance Abuse Prevention (CSAP), and Center for Behavioral Health Statistics and Quality. In FY 2023, SAMHSA’s total budget outlays were $7.567 billion.

Substance Use Prevention

In 2023, SAMHSA’s budget for CSAP was $236 million. Additionally, states are required to allocated 20 percent of the CSAT Substance Use Prevention, Treatment, and Recovery Services Block Grant to SUD prevention. In FY 2020, it equaled $2.008 billion; 20 percent of that is $401 million. Thus, total SAMHSA SUD prevention spending in 2023 was approximately $638 million (Table 7). This calculation assumes that none of the funding

TABLE 7 SAMHSA substance use disorder prevention funding, fiscal year 2023 (millions)

Source: SAMHSA, Justification for Estimates for Appropriations Committee, FY 2024, p. 352. https://www.samhsa.gov/sites/default/files/samhsa-fy-2024-cj.pdf

for $1,575 million budgeted for State Opioid Response grants was allocated for primary or secondary prevention.

Examples of SAMHSA SUD Prevention Programs

One of CSAP’s largest SUD prevention programs—Strategic Prevention Framework Partnership for States—allocates grants to develop and deliver state and community substance misuse prevention and MH promotion services (SAMHSA, 2023b). Another relatively large SAMHSA SUD prevention program is the Strategic Prevention Framework for Prescription Drugs—which raises awareness about the dangers of sharing medications and works with pharmaceutical and medical communities on the risks of over-prescribing to young adults. SAMHSA also provides Sober Truth on Preventing Underage Drinking grants that aim to prevent and reduce alcohol use among those aged 12–20. Its Federal Drug-Free Workplace programs aim to eliminate illicit drug use within executive branch agencies and federally regulated industries. Its Tribal Behavioral Health Grants program focuses on substance use, misuse, and suicide among American Indian/Alaskan Native populations. CSAP’s Center for the Application of Prevention Technologies provides prevention training and technical assistance through cooperative agreements.

MH Disorder Prevention

Unlike for substance use, SAMHSA has no office of MH disorder prevention. Drawing the line between SAMHSA funding for prevention and treatment is challenging. Table 8 displays SAMHSA’s total FY 2023 budget in the second column; the third column lists the programs that this paper estimated to be primarily for prevention. This paper estimates that in FY 2023, $919 million of SAMHSA’s total MH funding of $2,788 million was for programs identified as being primarily for prevention.

SAMHSA MH Disorder Prevention Programs

The majority of SAMHSA’s prevention funding went toward preventing suicide and developing the crisis system ($617 million of $912 million, or 67 percent). The remainder primarily focused on preventing mental illness among youth. The Project AWARE discretionary grant program focuses on promoting MH in school. The Project LAUNCH discretionary grant program promotes the wellness of young children, from birth to age 8, by addressing the social, emotional, cognitive, and behavioral aspects of their development. The Infant and Early Childhood Mental Health grant program aims to improve outcomes for children from birth through 12 by developing, maintaining, or enhancing infant and early childhood MH promotion, intervention, and treatment services.

Some excluded programs might be considered prevention, broadly defined. For example, SAMHSA budgeted $22 million for Criminal and Juvenile Justice Programs providing grants and technical assistance to divert

TABLE 8 SAMHSA total mental health funding and mental health disorder prevention funding, fiscal year 2023 (millions)

Source: Department of Health and Human Services Fiscal Year 2024, Substance Abuse and Mental Health Services Administration, Justification of Estimates for Appropriations Committees. https://www.samhsa.gov/sites/default/files/samhsa-fy-2024-cj.pdf

CDC

CDC is a “federal public health agency that develops and supports community-based and population-wide programs and systems to promote health and prevent the leading causes of disease, injury, disability, and death, both domestically and globally” (CRS, 2023). CDC activities include “developing expertise and best practices in disease prevention and control; conducting and supporting public health research; supporting and conducting public health surveillance and data collection; developing public health laboratory capacity; supporting health education and promotion efforts; coordinating and providing technical assistance to public health programs at the state and local level; supporting some preventive health services programs (e.g., some vaccination and cancer screening programs); and supporting public health emergency preparedness and response efforts.” (CRS,

adults and/or youth with mental illness from the criminal or juvenile justice systems to community-based MH and SUD and other supports before arrest and booking. Table 9 provides a brief description of the purpose of the programs listed in Table 8.

TABLE 9 Description of SAMHSA’s major mental health programs (treatment and prevention focused)

Source: Department of Health and Human Services Fiscal Year 2024, Substance Abuse and Mental Health Services Administration, Justification of Estimates for Appropriations Committees. https://www.samhsa.gov/sites/default/files/samhsa-fy-2024-cj.pdf

2023). CDC is organized into several centers, institutes, and offices, some of which focus on specific public health challenges (e.g., immunization and respiratory diseases, injury prevention), but none focus on BH prevention specifically.

CDC’s core budget outlays were $10 billion in FY 2023. CDC’s budget is primarily determined through annual appropriations rather than mandatory spending programs, although CDC administers several programs funded by mandatory spending authorities, such as the Vaccines for Children program. It also frequently receives one-time supplemental appropriations in response to specific incidents—such as infectious disease threats (CRS, 2023). Many of CDC’s programs support public health activities at the state and local levels, and a substantial portion of CDC’s annual budget is awarded as grants or cooperative agreements to state and local health departments (CRS, 2023).

CDC noted that its discretionary budget has grown increasingly complex, with 13 different Treasury accounts. This complexity may contribute to CDC’s fragmented approach to BH prevention. Table 10 describes CDC’s total budget by the 13 divisions and the subset of funding determined in this paper to be for MH/SUD prevention.

TABLE 10 CDC total funding and mental health/substance use disorder prevention funding, fiscal year 2023 (millions)

Sources: Department of Health and Human Services Fiscal Year 2024, Centers for Disease Control and Prevention, Justification of Estimates for Appropriations Committees. https://www.cdc.gov/budget/documents/fy2024/FY-2024-CDC-congressional-justification.pdf

TABLE 11 CDC substance use prevention funding, fiscal year 2023 (millions)

Source: Department of Health and Human Services Fiscal Year 2024, Centers for Disease Control and Prevention, Justification of Estimates for Appropriations Committees. https://www.cdc.gov/budget/documents/fy2024/FY-2024-CDC-congressional-justification.pdf

According to ONDCP, in FY 2023, CDC budgeted $528.6 million on drug abuse prevention. According to CDC, the majority of this ($505 million) was for opioid abuse and overdose prevention and surveillance (see Table 11). Examples of programs and products funded with the $505 million include information systems to collect and report on overdoses; ACEs data collection; syringe services programs cooperative agreements; guidelines on safely prescribing pain medications; research on the opioid epidemic; and public health campaigns about opioid overdoses. The majority of CDC’s drug use prevention funding is allocated toward surveillance and research rather than primary prevention interventions.

CDC budgeted approximately $17.5 million toward preventing alcohol use and fetal alcohol syndrome. One example of how this funding is used to encourage primary care providers to screen women of reproductive age for risky alcohol use and provide pregnant women appropriate, evidence-based interventions to reduce alcohol use.

As shown in Table 12, CDC budgeted $204 million for a variety of other programs that influence risk factors for developing MH conditions, such as those aimed at preventing childhood adverse events, firearm injury, rape, and domestic violence. CDC budgeted $30 million for suicide prevention through grants to a variety of state, territorial, tribal, and nongovernmental organizations (CDC, n.d.b). CDC budgeted $19 million for programs to support students’ emotional well-being (i.e., school health).

TABLE 12 CDC budget for mental health disorder prevention funding, fiscal year 2023 (millions)

Source: Department of Health and Human Services Fiscal Year 2024, Centers for Disease Control and Prevention, Justification of Estimates for Appropriations Committees. https://www.cdc.gov/budget/documents/fy2024/FY-2024-CDC-congressional-justification.pdf

ACF

ACF “promotes the economic and social well-being of families, children, youth, individuals, and communities with funding, strategic partnerships, guidance, training, and technical assistance . . . ACF administers more than 60 programs with 2023 outlays of more than $78 billion, making it the second largest agency in HHS” (ACF, 2024a). Approximately 54 percent of spending is for mandatory programs, and the remaining 46 percent is for discretionary programs.

ACF’s FY 2023 largest programs included TANF (25 percent of outlays), Head Start (17 percent), Foster Care (15 percent), Child Care and Development Block Grant (16 percent), Child Support (6 percent), Low Income Home Energy Assistance Program (2 percent), and Refugee/Entrant Assistance (12 percent) (ACF, n.d.-a).

Many ACF programs are focused on promoting well-being and aim to reduce risk factors that contribute to the development of MH/SUD conditions, such as poverty, economic stress, and ACEs. For example, the Community Services Block Grant “provides funds to states, territories, and tribes to administer to support services . . . [such as] housing, nutrition, utility, and transportation assistance; employment, education, and other income and asset building services; crisis and emergency services; and community asset building initiatives” (ACF, 2024b).

As shown in Table 13, this paper estimates that ACF spent $1.126 billion on preventing MH/SUD conditions. The largest MH/SUD programs are the Promoting Safe and Stable Families Program (PSSF); Child Welfare Services; Family Violence and Prevention Services; and Child Abuse Prevention and Treatment Act (CAPTA) State Grant program.

The PSSF is a mandated program that aims to enable states and tribes to operate community-based services to “(1) ensure children’s safety within the home and preserve intact families in which children have been maltreated when the family’s problems can be addressed effectively (family preservation services), (2) prevent child maltreatment among families at risk by providing supportive family services (family support services); (3) address the problems of families whose children have been placed in foster care so that reunification may occur in a safe and stable manner (family reunification services); and (4) support adoptive families by providing support services so that they can make a lifetime commitment to their children (adoption promotion and support services)” (Capacity Building Center for States, 2023, p.1). Mandatory PSSF funds are distributed to states, territories, and tribes through formula grants based on the jurisdiction’s share of children receiving benefits through SNAP. The law requires that states and tribes provide 25 percent.

Child Welfare Services

The Social Security Act of 1935 created the Child Welfare Services Program, which provides formula grants to state and tribal public child welfare agencies to promote and protect the welfare of all children; prevent neglect, exploitation, and abuse of children; and support

TABLE 13. Administration on Children and Families mental health prevention funding, fiscal year 2023 (millions)

Source: Department of Health and Human Services Fiscal Year 2024, Administration for Children and Families, Justification of Estimates for Appropriations Committees. https://www.acf.hhs.gov/sites/default/files/documents/olab/fy-2024-congressional-justification.pdf

at risk families through services that allow children to remain in home when appropriate. Services are available to children and families regardless of income. States are required to match federal funding by 25–35 percent.

Family Violence and Prevention Services

This is a congressionally authorized discretionary program to support programs and projects to prevent family, domestic, and dating violence and provide shelter and immediate services for adult and youth survivors of domestic violence. Eighty percent of the funding goes to states and tribes based on formula grants. States then distribute the funding to local public and nonprofit organizations.

The CAPTA State Grant Program

This was created by the Child Abuse and Treatment Act (P.L. 93-247) to provide formula grants to states to improve child protective services. It assists states in such services, such as providing training and investigating child abuse and neglect reports. “States perform a range of prevention activities, including addressing the needs of infants born with prenatal drug exposure, referring children not at risk of imminent harm to community services, implementing criminal record checks for prospective foster and adoptive parents and other adults in their homes, training child protective services workers, protecting the legal rights of families and alleged perpetrators, and supporting citizen review panels,” (ACF, n.d.-b, p. 167).

HRSA

HRSA is an HHS agency whose mission is to “enhance the health and well-being of all Americans by providing for effective health and human services” (HRSA, n.d.a.). Its ”strategic goals are to take actionable steps to achieve health equity and improve public health, improve access to quality health services, foster a health workforce and health infrastructure able to address current and emerging needs, optimize its operations, and strengthen program engagement” (HRSA, n.d.-b).

HRSA’s budgetary outlays in FY 2023 were $14.795 billion, $9.487 billion of which is discretionary. The largest programs by funding amount were health centers (e.g., federally qualified health centers) ($1.737 billion); workforce innovations ($1,820 million); Maternal, Child, and Home Visiting Program ($1,677 million); and the Maternal and Child Block Grant ($815 million).

I estimate that HRSA spending was $142 million on SUD prevention (see Table 14); $88 million was for the Rural Communities Opioid Response Program, which issues competitive and cooperative grants “to reduce the morbidity and mortality associated with SUD . . . in high-need rural communities by establishing, expanding, and sustaining prevention, treatment, and recovery services”; $54 million was for SUD prevention delivered through HRSA’s health center program (ONDCP, 2023c, p. 103).

TABLE 14 HRSA substance use disorder prevention funding, fiscal year 2023 (millions)

Source: Health Resources and Services Administration, Fiscal Year 2024, Justification of Estimates for Appropriations Committee.

I categorized HRSA’s Early Childhood Home Visiting Program as an MH prevention program (see Table 15). HRSA funds states, jurisdictions, and tribes to develop and conduct home-visiting programs. States and jurisdictions must use evidence-based home-visiting models approved by the Home Visiting Evidence of Effectiveness review. The latest list of approved models includes the Family Check-Up for children and Nurse-Family Partnership.

ACL

ACL is a department within HHS whose mission is to maximize the independence, well-being, and health of older adults with disabilities across the life span and their families and caregivers. ACL’s FY 2023 outlays were about $2.526 billion, which were mostly discretionary. ACL “funds services and supports provided primarily by networks of community-based organizations; advocates to ensure the needs of disabled people and older adults are reflected in federal policy and programs; and invests in research, education, and innovation” (ACL, 2022, p.5). “ACL focuses on two categories of performance measures: (1) supporting people’s ability to remain independent and live in the community and (2) generating new knowledge about what works for older adults and people with disabilities” (ACL, 2022, p.11).

TABLE 15 HRSA mental health disorder prevention funding, fiscal year 2023 (millions)

Source: Health Resources and Services Administration, Fiscal Year 2024, Justification of Estimates for Appropriations Committee

ACL has specific programs focused on prevention; however, no programs in its FY 2023 enacted budget specifically call out MH/SUD prevention. Some relevant activities are scattered within its programs. For example, National Technical Assistance Center on Kinship and Grandfamilies describes one of its activities as engaging “experts to stimulate the development of new, and identify existing evidence-based, evidence-informed, and exemplary practices or programs related to health promotion (including mental health and substance use disorder treatment)” (ACL, 2023; p. 274). ACL’s nutrition service programs deliver “dietary interventions, combined with educational, social, and behavioral interventions; and enhancing the identification of, and support for, older adults with elevated suicide risk or in mental health distress” (ACL, 2023; p. 65).

The main source of ACL funding for prevention services is Title III-D of the Older Americans Act, established in 1987 to provide formula grants to states to support healthy lifestyles and promote healthy behaviors among older adults (age 60 and older). Priority is given to those living in medically underserved areas of the state and with greatest economic need (ACL, n.d.-a). States that receive funds under Title III-D must spend those funds on evidence-based programs that have been proven to improve health and well-being and reduce disease and injury. Title III-D funding does not appear to be used to focus on preventing MH/SUD but could be used to expand ACL’s focus on BH prevention in older adults.

DEPARTMENT OF EDUCATION

In 2023, the Department of Education reported budgeting $108.7 million for SUD prevention, allocated to implement “evidence-based, multi-tiered behavioral frameworks” for “improving behavioral outcomes and learning conditions for students” (ONDCP, 2023b).

The Department of Education provides funding for programs that may contribute to preventing mental disorders, such as preschool readiness programs. However, I excluded these estimates from the financial totals. I also excluded programs that were described as primarily to increase the number of MH professionals in schools.

STATE SPENDING BH PREVENTION

State Financing Overview

Total state spending in FY 2023 was $2.96 trillion, including federal transfers (NASBO, 2023). The largest portion of spending went to Medicaid (29.6 percent) and education (27.3 percent) (NASBO, 2023). Approximately $1.04 trillion was transfers from the federal government (35 percent); $1.24 trillion (38 percent) came from general funds through

broad-based state taxes and 0.74 trillion (25 percent) from other state funding sources that are restricted by law to a particular government activity, such as tuition and fees for higher education and provider fees under Medicare. The remaining 1.5 percent came from bonds.

In 2021, total state tax revenue comprised “15 percent from property taxes, 13 percent from individual income taxes, 12 percent from general sales taxes and gross receipts taxes, 5 percent from selective sales taxes on purchases such as alcohol, motor fuel, and tobacco products, 2 percent from corporate income taxes, and 3 percent from all other taxes, such as license, estate, and severance taxes” (Urban Institute and Brookings Institution, 2024).

State Spending on BH Prevention

States reporting to SAMHSA spending approximately $1,464 million on SUD prevention in 2022 (see Table 16). It requires states to report spending on primary substance use prevention funding directed by the state agency in charge of substance use treatment and prevention as part of states’ maintenance of effort requirements. The largest source of state SUD prevention spending was the SAMHSA block grant, followed by Medicaid, other federal funds, and state funds. Direct funding from the state and local governments, excluding federal funds and Medicaid, was $124 million.

States reported spending approximately $196 million on primary MH disorder prevention (see Table 17). This was defined as funds for prevention under the direction of the state’s MH agency. The largest source was state funds, other federal funds, and local funds. Direct funding from the state and local governments, excluding federal funds and Medicaid, was $145 million.

TABLE 16 State primary substance use disorder prevention spending, 2023 (millions)

Source: SAMHSA: WebBGAS (samhsa.gov)

TABLE 17 State mental health disorder prevention spending, 2023 (millions)

Source: SAMHSA: WebBGAS (samhsa.gov)

State departments of education provide funding for school counselors, social workers, and psychologists. This spending is described as primarily aimed at treating MH conditions, rather than prevention, so it was not included in these estimates. However, some portion of their time may consist of prevention activities. A few states, such as California and Arkansas, target tax dollars for student MH, including MH disorder prevention (Rafa et al., 2021).

Combined, state spending on MH/SUD prevention, excluding federal funds and Medicaid, was $269 million.

State Laws and Regulations to Prevent Substance Use

CDC recommends that states and local communities use regulations to reduce the availability of alcohol, such as zoning and licensing rules that limit where and when it can be sold (CDC, n.d.-a). The National Institute on Alcohol Abuse and Alcoholism has a database that tracks the variety of state laws pertaining to the sale of alcohol and recreational cannabis (NIAAA, 2023). States must finance the enforcement of these regulations, which is an unrecognized cost of prevention.

Expanding State Spending on BH Prevention Through Earmarked Taxes

One option for expanding MH/SUD prevention spending is earmarked taxes. A 2023 study found that “approximately 30 percent of the U.S. population lives in a jurisdiction with a tax earmarked for MH, and these taxes generate over $3.57 billion annually” (Purtle et al., 2023, p. 458). Some taxes include the option to fund prevention services, whereas some

are only focused on treatment. The nature of the taxes varies: on income, property, and specific goods/services. A growing potential source of revenue are excise taxes on cannabis and gambling (Purtle, Brinson and Stadnick, 2022). As with many prevention funding sources, there is a need to ensure that the taxes are being used to fund evidence-based prevention activities.

Expanding State Spending on BH Prevention Through Settlement Funds

Settlements from several lawsuits of manufacturers and distributors of opioid pain medications has resulted in approximately $55 billion in funding going to states and localities (Minhee, n.d.). The settlements restrict the funding to focus primarily on abatement of the opioid epidemic and explain that this includes prevention, such as media campaigns to prevent opioid use, evidence-based prevention programs in schools, medical provider outreach and education regarding opioid prescribing best practices, and community drug disposal programs (Attorney General, 2021). Various efforts are underway to try to track how states and localities are using their opioid settlement funds, but there is no comprehensive accounting on how much is being allocated to prevention rather than treatment or other activities. However, a high-level review of some of the states that are reporting how they are using their funds indicate that a small share is going to prevention of opioid use disorder rather than treatment or harm reduction (e.g., Massachusetts, Florida). States may be able to require that a larger proportion of opioid use disorder settlement funds go to primary prevention.

PRIVATE SPENDING ON BH PREVENTION

Private actors, such as charities/foundations, health care providers, nonprofit and for-profit businesses, and employers, also contribute directly to funding BH preventions and could increase their contributions.

Charitable/Nonprofit Organizations

One estimate is that approximately $150 billion in private foundation funding goes to public health, including BH (Shaw-Taylor, 2016). In 2022, the largest private foundations focused on public health include the Robert Woods Johnson Foundation ($705 million in total charitable disbursements), Bill and Melinda Gates Foundation ($7,043 million), Bloomberg Philanthropies ($1,700 million), and California Endowment ($249 million). No accounting exists of how much of their funding goes to primary MH/SUD prevention.

Private Insurance

The ACA requires “that most private insurance plans provide zero-dollar coverage for the preventive services recommended by four ACA designated organizations, specifically: U.S. Preventive Services Task Force, Advisory Committee on Immunization Practices, Women’s Preventive Services Initiative, [and] Bright Futures” (AMA, 2024).

Employers

Employers fund workplace wellness programs and employee assistance programs that can be targeted at reducing MH/SUD. CDC has a registry of effective workplace health promotion interventions that include those focused on alcohol and substance use and depression (CDC, 2024). According to CDC, key principles to develop a well-defined alcohol- and drug-free workplace policy include publicizing the policies and ensuring that employees are know that substance misuse is never permitted in the workplace; implementing workplace health promotion programs, including education on substance misuse; and offering employee assistance programs, which provide assessment, counseling, and referral for employees regarding substance misuse. Surveys of employers find 46 percent of small, and 68 percent of large firms offer some other lifestyle or behavioral coaching program, such as stress management and substance use counseling (KFF, 2023). The U.S. corporate wellness market size was estimated to be $20.05 billion in 2022 (Fortune Business Insights, 2024).

CONCLUSIONS

I estimate that the federal government spent $4,574 million on BH prevention and states and localities spent $269 million on BH prevention. No data were available to estimate total spending on BH prevention by the private sector.

As explained in the method section of this paper, this estimate is both too large and too small. It is too large, for example, because programs often do not separate out funding for treatment and tertiary prevention from that for primary and secondary prevention. In recent years, the federal government has increased spending on tertiary prevention (also known as “harm reduction”) to reduce deaths caused by drug overdoses.

This estimate is also too small because it excludes funding on social safety-net programs that may reduce the risk of developing MH/SUD conditions, particularly among low-income families, such as nutrition programs, Head Start, CHIP, TANF, Tenant Based Rental Assistance, and Education for the Disadvantaged.

The range and complexity of the risk factors that may increase the odds that an individual will develop an MH/SUD make it challenging to neatly define the BH prevention infrastructure and financing landscape.

Based on this paper, I presented information to the committee about potential opportunities to improve financing for prevention of mental, emotional, and behavioral disorders. Together with presentations at public information-gathering meetings, this contributed to the committee’s deliberations and the development of its recommendations.

REFERENCES