Are you able to get a statement from her doctor about the baby's prognosis? I would want to know the effects of the Percocet, Xanax, and heroin use during pregnancy (in addition to the prescribed meds.) Crack usually doesn't have lasting effects (at least not to the extent previously thought.) Alcohol use isn't a good thing but I'm not sure how much is to much, especially in the beginnning.
My son's birth father is severely schizophrenic. His birth mother has an undiagnosed mental illness. My STBAD's birth mother is mentally ill and likely drank throughout her pregnancy. My kids are wonderfully healthy. There are no guarantees that they will escape mental illness but I've been told that being in a stable home greatly decreases the likelihood.
My gut feeling is that I wouldn't accept the placement. I would need a lot more information before I made a final decision, though.
