Franklin, Tenn.-based Acadia Healthcare has faced mounting legal, financial and leadership challenges in recent months, including lawsuits alleging abuse at one of its psychiatric hospitals, a multimillion-dollar employment verdict and pressure from investors over the company’s performance and governance.
Here are six things to know:
1. Pittsburgh-based Southwood Psychiatric Hospital — owned and operated by Acadia — is facing multiple lawsuits claiming sexual and physical abuse of minor patients at its psychiatric facility.
One complaint alleges a minor patient was sexually assaulted in October 2023 by another patient after being placed in a shared room despite the alleged assailant’s known history of sexually abusive behavior. Another claim alleges a Southwood staff member repeatedly sexually assaulted a 17-year-old patient in September 2016.
2. Fashion Valley Comprehensive Treatment Center, one of Acadia’s indirect subsidiaries, was ordered to pay $105 million in damages in an employment-related lawsuit.
The center operates as a provider of medically supervised medication-assisted treatment for adults in California and was sued by a former employee who was terminated in October 2023. The lawsuit alleged retaliatory termination.
Acadia is not a party to the lawsuit.
3. In April, the system appointed David Duckworth as interim CFO after former CFO Todd Young exited. Mr. Duckworth previously served as CFO for Acadia. The interim appointment is expected to remain in place until the system completes its search for a permanent CFO.
In January, former CEO Chris Hunter departed from his role. The system reappointed Debra Osteen as CEO amid ongoing headwinds. She previously served in the position from 2018 to 2022 and remained on the company’s board until 2024. Ms. Osteen also rejoined the board.
4. In the first quarter of 2025, Acadia’s adjusted net income totaled $33.3 million, compared with $36.9 million in the prior-year period. It reported revenue of $828.8 million for the first quarter ending March 31, a 7.6% increase compared to the first quarter of 2025.
Acadia Healthcare reported a fourth-quarter net loss attributable to Acadia of $13.02 per diluted share after recording a $996.2 million non-cash goodwill impairment charge, the company said in its fourth-quarter and full-year 2025 results.
5. Acadia agreed to settle a securities lawsuit for $179 million. The settlement, reached Nov. 7, resolves a previously disclosed case in the U.S. District Court for the Middle District of Tennessee.
The company recorded the net settlement amount as an expense in the quarter ending Dec. 31.
6. In September, an investor owning approximately 3% of Acadia sent a letter to the company’s board of directors outlining recommendations to improve shareholder value.
The investor criticized the company’s executive turnover, capital allocation decisions and operating structure, citing a shift from geographic leadership to service-line reporting as a key factor in the company’s performance decline. The firm also urged Acadia to halt all growth capital investments, reduce overhead, sell assets and repurchase shares, recommending a board refresh.
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