To keep pace with demand for behavioral healthcare, health systems are choosing joint ventures with for-profit behavioral healthcare companies.
Franklin, Tenn.-based Acadia Healthcare operates 21 joint venture partnerships with 22 hospitals, according to its second quarter earnings report.
Jeffrey Woods, DNP, operations director at Acadia, told Becker's many hospitals have a long track record of providing behavioral health in their community, but behavioral services are not their core competency.
"They recognize and often will tell us directly — we're just not experts at this," Dr. Woods said.
Acadia's joint ventures include deals with St. Louis-based Ascension, Burlington, Mass.-based Tufts Medicine and Danville, Pa.-based Geisinger.
Joint venture facilities typically carry the name of the health system involved, Dr. Woods said, to identify the facility to the community. Acadia's joint ventures are run on a 50-50 model, he said.
Acadia opened its first joint venture hospital, Southcoast Behavioral Health, in partnership with New Bedford, Mass.-based Southcoast Health in 2015.
The company now has 11 joint venture hospitals in operation, with 11 more set to open in the coming years.
Darcy Lichnerowicz, CEO of Southcoast Behavioral Health, told Becker's the partnership was formed as Southcoast was looking for a way to treat the growing number of patients presenting with mental health conditions in emergency departments.
"To have a partnership like this really addresses speed issues that impact healthcare," Ms. Lichnerowicz said. "They can rely on us to expedite those patients getting out of the ED, thereby opening up space for people who are there for other emergencies."
Hospitals may opt for a joint venture partnership for several reasons, according to a 2022 report from VMG Health. In addition to alleviating ER capacity issues, joint ventures can help hospitals upgrade aging behavioral facilities and recruit hard-to-find behavioral health providers.
"I think most hospitals recognize that behavioral health is not where they want to focus their attention and energy," Ms. Lichnerowicz said. "By partnering with someone whose exclusive focus is that speciality, it frees them up to focus on other areas that are more in their wheelhouse."
Southcoast Behavioral Health also relies on its partnership with Southcoast Health to treat patients with complex medical and behavioral needs, Ms. Lichnerowicz said.
Since opening, Southcoast Behavioral Health has expanded twice. The first expansion added geriatric care to the facility, and the second expansion was added in response to growing mental health needs in the wake of the COVID-19 pandemic, Ms. Lichnerowicz said. The hospital now has 192 beds.
Some of the largest behavioral health companies in the U.S. have faced allegations that patients are mistreated at their facilities. In June, a Senate Finance Committee report alleged children are frequently harmed in residential treatment facilities, including those owned by UHS and Acadia.
A New York Times investigation alleged Acadia kept patients beyond medical necessity to maximize insurance reimbursements. Acadia said "decisions on patient care, including how long treatment may be necessary, are never business decisions made by the company."
The need for mental health treatment has intensified since the pandemic, part of the reason hospitals are interested in joint ventures, Dr. Woods said. Though need has increased, decreasing stigma around mental health treatment has made it easier to expand facilities, he said.
"Even as recently as five or ten years ago, there were communities I would go into with the proposition of bringing a behavioral health facility, and they would come out with pitchforks and torches and say 'not in my backyard,'" Dr. Woods said.
In addition to Acadia, King of Prussia, Pa.-based Universal Health Services is a major player in behavioral joint ventures, with partnerships with Livonia, Mich.-based Trinity Health and Allenton, Pa.-based Lehigh Valley Health Network.
Brentwood, Tenn.-based Lifepoint Health has also stepped into the space.
Kathy Bolmer, COO of behavioral health at Lifepoint, said joint ventures are becoming more common in behavioral health. One reason behind this could be a decline in facilities available to be acquired, she said.
Building a new facility can cost a lot of money for a system, Ms. Bolmer said.
"Some systems are hesitant to jump into that," she said. "This is a way that certainly benefits the non-psychiatric and psychiatric systems."
The private-equity backed company has two ventures in operation, and others in the construction or planning process, Russ Bailey, president of Lifepoint Behavioral Health said.
Joint ventures can offer hospitals lower costs, and allows hospitals to invest money and time on areas of acute care, Mr. Bailey said.
"It really is a win-win-win," he said. "It's a win for each partner, but at the end of the day, it's a win for communities and patients."