The Vistria Group – one of health care’s most active private equity investors, particularly in home health and hospice care – is making further inroads in the behavioral health space.
Among its most recent investments is Sandstone Care, according to a Wednesday report from Axios. Sandstone Care is a provider of behavioral health services for young people. It has locations in Colorado, Maryland and Virginia.
Behavioral Health Business was unable to reach Vistria or Sandstone prior to the publication of this story.
Other Vistria health care investments include predictive analytics company Medalogix and staffing business Supplemental Health Care, along with in-home care providers Mission Healthcare and Help at Home. Even prior to Sandstone, the PE firm’s portfolio likewise included behavioral health-related assets Behavioral Health Group (BHG), Sevita and Beacon Specialized Living.
Sandstone, however, is a direct reflection of Vistria’s ambitions to expand into the youth mental health space. It outlined that vision in June, following a call to action from the U.S. Surgeon General Vivek Murthy at the 2022 Youth Mental Health Summit.
“The mental health crisis among youth is escalating across the nation, and it’s become increasingly imperative for the private sector to step up and help address it,” Vistria Partner Jon Samuels said at the time. “Our team is proud to be part of an ecosystem of stakeholders that are answering the Surgeon General’s call, utilizing private capital and outside resources to address this complex, societal problem.”
As part of its June commitment, the Chicago-based Vistria pledged $250 million toward investments in U.S. providers of youth mental health services over the next three years.
Vistria’s investment in Sandstone is valued at upwards of $200 million, Axios reported, adding that the deal puts the provider’s EBITDA at around $12 million.
Sandstone’s services include support for teens and young adults with depression, trauma, anxiety and other common behavioral health conditions. The company – helmed by CEO Michael Hunter – also offers treatment programs for young adults and adolescents struggling with substance abuse and co-occurring disorders.
In 2021, more than a third of high school students reported they experienced poor mental health during the COVID-19 pandemic, according to CDC data. Additionally, 44% reported they persistently felt sad or hopeless during the past year.
The rate of substance use disorder among America’s youth has similarly spiked in recent years.
“Mental health challenges in children, adolescents, and young adults are real and widespread,” Murthy said in a December Surgeon General advisory. “Even before the pandemic, an alarming number of young people struggled with feelings of helplessness, depression and thoughts of suicide — and rates have increased over the past decade.”
“The COVID-19 pandemic further altered their experiences at home, school and in the community, and the effect on their mental health has been devastating,” he added. “The future wellbeing of our country depends on how we support and invest in the next generation.”
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