Oceans Healthcare to Enter Two New States in 2021 to Serve Overlooked Populations

Since 2004, Oceans Healthcare has been making a name for itself by providing behavioral health services to overlooked populations.

At first, that meant seniors: The provider of inpatient and outpatient behavioral health services got its start treating the older adult and geriatric population specifically. While that demographic is still key to Oceans’ business, it’s since expanded into underserved geographies, too, where it treats patients of all ages.

Today, Oceans — which is backed by the venture capital firm General Catalyst Partners — operates 42 locations including hospitals and outpatient programs across Texas, Louisiana and Mississippi. Headquartered in Plano, Texas, the behavioral health company serves patients experiencing conditions such as depression, anxiety, schizophrenia and behavioral changes related to medication management, substance abuse and other issues.

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Oceans’ growth has also captured local and national attention in recent years. The company was recognized for four consecutive years by the Dallas Business Journal as one of the 50 fastest-growing middle market companies in the North Texas area, an acknowledgement bestowed upon both public and private enterprises pulling in annual revenues between $25 and $750 million.

Plus, it had a four-year run on Inc. Magazine’s Top 5000 list of fastest growing private companies in America. In 2019, its most recent year on the list, Oceans was the only behavioral health provider to have been ranked.

Oceans hasn’t wasted any time in 2021 on its continued expansion, as it opened two new facilities in January — an Amarillo, Texas-based inpatient psychiatric facility serving patients age 50 and older and an inpatient/outpatient behavioral health hospital in Shreveport, Louisiana serving patients 18 and up, where it plans later in the year to add geriatric services.

BHB recently connected with Oceans CEO Stuart Archer to talk about Oceans’ growth trajectory for the rest of the year, which includes plans to enter two new states in 2021. On top of that, Archer explained the company’s focus on geriatric populations, its legislative priorities and more.

You can read the conversation with Archer below, which has been edited for length and clarity.

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BHB: Tell us about the origin story of Oceans and what sets it apart from other behavioral health providers.

Archer: Oceans has been a quieter part of the behavioral health story in the country, and I’m certainly very honored to be our CEO. 

Our organization was founded almost two decades ago by two clinicians — a social worker [Nick Guillory, who currently remains with Oceans as the company’s executive vice president of operations] and a nurse [Jason Reed, who was Oceans’ CEO until 2014] — who saw in their communities a huge unmet need. That was an area of behavioral health that we feel to this day hasn’t gotten enough focus, and that’s the behavioral health needs of older adults and geriatrics. For almost a decade, our organization solely focused on the needs of those patients and our community.

In the last decade, our company has continued to keep those patients as a cornerstone of all of our hospitals. And today, we’re one of the largest providers of behavioral health to older adults and geriatrics in the country. As our footprint has grown, we’ve expanded that focus to the needs of adults and children, as well.

The origins of our company are in rural markets. We still work very closely with those markets, but we’ve also expanded to focus on the needs of middle America. Those are the areas today that lack and need better resources around behavioral health.

Part of Oceans’ recent expansion involved opening two new centers in Amarillo, Texas and Shreveport, Louisiana to kick off the new year. What was the impetus behind that?

Both of these deals had been ones we had been working on for some time, but things slowed a bit with COVID. Even before the pandemic, both of these markets had very clearly defined needs. We saw an increase in the amount of adults with mental health needs, and the pandemic only exacerbated the problems. These deals exemplify the type of markets we’re very focused on. 

What other markets are you looking to add in the future? Is Oceans hoping to expand into new states?

I’m excited to say that by year’s end, we’ll have two more states to add to that list.

One of the things about this industry is that you’re continually faced — both at a provider level and a corporate level — with infinite need and finite resources. And so at Oceans, we have thought it best to really focus on density within states versus dots on a map. We had an opportunity to probably participate in 20 other states, but we very mindfully have focused our growth efforts on density in the states that we’re in.

Mental health and behavioral health operate under a state level with very different frameworks. One of our core conditions is to be very involved at a legislative level, so that means not only being involved at a federal level with the dialogue that impacts this industry [and] our patients, but also the fabric of the dialogue on a state level.

For instance, in Mississippi, Oceans two years ago authored and championed a successful repeal of the IMD exclusion for Medicaid patients. We have drafted and been a part of the legislation in every state that we operate in.

I’m on the board and am proud to serve for the National Association for Behavioral Healthcare. Oceans is also on the board of the Ambulatory Association of Behavioral Health, and we’re active members of the Texas Hospital Association, Louisiana Hospital Association and Mississippi Hospital Association, as well.

It takes a lot of work to do this right, and we like to be very thoughtful and mindful about our growth.

Can you disclose which two states you’re looking to enter and how many locations you’ll add there?

Unfortunately, I can’t. But they’re states where we feel we can do the same great work we’re doing in the states we’re in, and we feel we have an opportunity to become a big player in those new states.

Oceans is financially backed by General Catalyst Partners. Can you provide some clarity on the role that investment has played for the company, especially during the time of COVID?

General Catalyst has been an investor and the majority owner of Oceans for almost seven years. They have been a great partner and have a deep and rich background in technology and venture capital.

Because of that technology background, they definitely understand volatility and change. Throughout COVID, they demonstrated what only a crisis can bring, and that’s finding out what your partners are made of when things aren’t great. They are the folks that you would want in a foxhole with you.

When we heard from you at the end of last year for BHB’s 2021 outlook, you mentioned how telehealth had become an integral part of Oceans’ services and how we’ll likely see a continued focus on telehealth even post-pandemic. Can you talk about the role telehealth will play for Oceans going forward?

Those of us in the provider space have, for some time, seen the opportunity and power of telehealth to be a game changer in this industry [and] to reach people where they are versus making them come to us. It provides many patients access to a high-class physician with the anonymity that only telehealth can sometimes provide.

The piece we’ve got to continue to focus on is making sure that the reimbursement structure is made permanent. Because of COVID, we’re all operating in some fashion under emergency relief and flexibility. Hopefully, during this period, we’ve demonstrated as providers how flexible we can be and the impact this service can have on at-risk populations. We need to move to make these changes permanent.

Telehealth is not right for every patient. There are certain populations that certainly benefit more from this, and there are other populations such as the severely mentally ill that benefit more from in-person care. Telehealth is another tool — and a very important one — in our clinicians’ bag. 

In spite of opportunities that telehealth has opened up for Oceans, what impact has COVID had on the company?

COVID has had an impact on our census at times [on] the inpatient and outpatient sides, especially in the early days. Our nursing homes, rightfully so, had concerns about adequate personal protective equipment. This has lessened a bit, but we still see some volatility in referral patterns.

Our largest concern now continues to be not only our patients, but also our staff. Staffing continues to be a real concern across behavioral health. And burnout also remains a huge concern for us. Considering the tremendous responsibility and contributions frontline caregivers have made during this time, we worry about the toll that it’s taken on them.

You mentioned the need for lawmakers to make telehealth flexibilities permanent. Overall, what other behavioral health policy changes are you hoping to see federally from the new Biden Administration, and what do you make of the ones that have been made or hinted at so far? 

It’s early for this administration, and for many of us, we read the tea leaves the way that we want to read them. But I would certainly hope the Biden Administration would look strongly at making permanent many of the telehealth changes that we’ve seen.

Parity is still just a laudable goal, not a reality, so parity is also a huge issue in the behavioral health space.

Continued investment in the workforce is important. Behavioral health has seen a tremendous growth, and you’re seeing new graduates interested in it like never before. But we’ve got a lot of workforce development to do across this country to help educate and potentially change the stigma of young students, young physicians and others about what a career in behavioral health can mean.

What else do you think is in store for the behavioral health industry as a whole in 2021?

COVID has continued to drive this dialogue around behavioral health. This is going to be a busy time for [the industry], and not just on the inpatient hospital side. Across the whole spectrum, there is this spirit of innovation right now in behavioral health.

If there’s anything good that can come from such a terrible time as COVID, it may be that it’s forced us to once and for all really look at behavioral health and to think about the additional resources we can bring to bear. I think for some of that, it’s going to be about communities that need more access. It may also be that health systems want to look at bringing a partner in.

It’ll be a busy year in behavioral health across the entire spectrum.

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