Vertava Health To Expand Mental Health Business Following SUD Facility Sale

Vertava Health sold three of its four residential addiction treatment centers as part of a scale-back and pivot strategy.

The Nashville-based mental health and addiction treatment company sold the facilities to Fort Lauderdale, Florida-based Regard Recovery in a deal that closed at the end of 2022.

Terms of the deal were not disclosed.


The move marks another expansive acquisition on the Regard Recovery side of the deal. On the Vertave Health side, it frees up the company to expand its mental health business and adjust its addiction treatment business trajectory.

The three facilities are now known as Texas Recovery Center (Scurry, Texas), Swift River (Cummington, Massachusetts) and The Bluffs (Sherrodsville, Ohio). The facilities offer residential and detox services.

The acquisition expands Regard Recovery’s state footprint. Before the deal, Regard Recovery operated in Florida, Kentucky, New Jersey, Pennsylvania, Tennessee and West Virginia.


In late 2021, Regard Recovery acquired JourneyPure, a Nashville, Tennessee-based addiction treatment and mental health provider, for an undisclosed amount. The year before that, Regard Recovery acquired Destination Hope out of bankruptcy.

What the deal means for Vertava Health

Vertava Health continues to evolve. Initially, it was founded with a different name and a different focus.

Brent Clements founded Addiction Campuses in 2014 as an out-of-network, destination residential addiction treatment center provider, first launching in Southaven, Mississippi. This model was common and attractive to investors for facility-based care. However, payers began to cut out-of-network rates for residential treatment providers and patients began to look local for treatment.

This led to a flip in where private equity firms invested in the addiction treatment segment. From 2012 to 2016, the bulk of deals were in high-end destination programs. From 2017 to 2022, that part of the addiction treatment ecosystem saw the greatest shrinkage of deal volume, while value- and mid-range facilities saw the second-highest deal volume growth behind medication-assisted treatment companies.

The Fort Lauderdale-based addiction treatment provider Delphi Behavioral Health Group, founded in 2016, shuttered its facilities, laid off staff and sought bankruptcy protection due to these pressures.

The Boston-based private equity firm Summit Partners acquired Addiction Campuses in 2018. Clements left the company a year later and Matt Morgan was named CEO.

In an interview with BHB, Morgan said he and the board established early on that the company needed to go in a different direction. They wanted to build a full-spectrum behavioral health company that could operate at scale and in-network with health plans and had locations in geographies of 200,000 people or more.

The company quickly identified the three facilities sold in the deal as non-core assets to that mission.

“In all candor, we’re not committing resources, capital and time on a big part of the SUD business that we didn’t strategically want to continue to build … because it was in the opposite direction of where we were headed,” Morgan said. “It was really tough to build where we’re going by holding on to where we’ve been.”

In 2020, the company rebranded to Vertava Health.

Looking to the future

While preparing the three facilities for sale, Vertava Health has been “aggressively” growing an outpatient mental health business. It acquired a handful of outpatient mental health companies in Tennessee and Texas. However, Morgan declined to provide additional detail about the burgeoning mental health business.

He did say that the company hopes to support the integration of addiction and mental health services across the business. But today, they stand as largely separate entities. Further, 60% of its mental health business comes from providing adolescent care.

The addiction treatment business will also continue to grow, with the starting point being the company’s remaining residential treatment facility in Southaven, Mississippi.

Vertava Health has added outpatient services, partial hospitalization programs (PHPs) and intensive outpatient programs (IOPs) at that location. The company will expand in the Southeastern U.S. The company presently operates in Tennessee and Mississippi.

The addiction treatment business will focus on “lighter assets, lighter services” that run the spectrum of care and will include sober housing.

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