Landmark Recovery has laid off about 300 staffers in Indiana and its headquarters.
This comes after state regulators revoked the provider’s license in three of its four facilities in the state following a string of patient deaths and alleged sexual assaults on staffers at its facility in the South Bend area. The Nashville, Tennessee-based addiction treatment facility operator originally furloughed about 300 employees starting on July 30 while Landmark Recovery appealed the licensing revocation with the state.
On Aug. 28, the company’s human resources department sent a mass email obtained by Behavioral Health Business informing furloughed employees that their employment would end on Sept. 4.
“Due to the circumstances with both licensing and payor contracts in the state of Indiana — we will unfortunately be unable to bring you back from furlough,” the email states. “We understand that this news may come as a shock, and we want to assure you that this decision was not made lightly.”
Landmark Recovery has not responded to a request for comment.
Between July 3 and July 10, three patients died at Praxis of South Bend by Landmark Recovery; reportedly, two died from overdoses and a third from strangulation. The St. Joseph County, Indiana, coroner’s office has yet to rule on the cause of death, citing a need to review the facility’s security footage. St. Joseph Superior Court ordered Landmark Recovery to turn over that footage by Sept. 1, according to 16 News Now.
State regulators have taken action to investigate the provider following the deaths. On July 26, the Indiana Division of Mental Health and Addiction revoked Landmark Recovery’s license for the South Bend facility in Mishawaka, Indiana, as well as its licenses for Praxis of Carmel by Landmark Recovery and Praxis of Fort Wayne by Landmark Recovery.
The company operates one other facility in Indiana: Landmark Recovery of Indianapolis. The facility is open and taking patients, according to a Landmark customer service representative.
Landmark Recovery has appealed the state’s decision to revoke the licenses for three of its four Indiana facilities. On Aug. 17, an administrative law judge held a hearing for the company’s appeal. The judge has not rendered a decision, according to a spokesperson for the Indiana Office of Administrative Law Proceedings.
Cumulatively, Landmark Recovery’s facilities had 434 detox and inpatient beds, 298 of which were at the three closed Praxis facilities. Landmark’s Praxis-branded facilities are set aside for exclusively treating Medicaid patients. Its main brand, Landmark Health, is reserved for patients paying out of pocket or with commercial health insurance.
The company uses this approach to profitably increase access to addiction treatment access while offsetting typically low state Medicaid reimbursement rates. However, Landmark Recovery typically builds larger facilities to boost revenue and operate them as efficiently as possible. This, combined with the company’s ambitious growth plans, has set the company up for trouble, especially at Praxis of South Bend by Landmark Recovery. In July 2022, Landmark Recovery CEO Matt Boyle told BHB that the company planned to have 16 facilities in operation by the end of that year and 40 in operation by the end of 2023.
The 160-bed South Bend facility is purportedly the largest to cater exclusively to Medicaid patients. It opened on Aug. 15 and almost immediately had troubles, according to local police records reviewed by BHB. It was also the largest Landmark Recovery tried to launch
The St. Joseph County Police Department responded to 111 calls at the facility in the 192 days of 2023, ending July 11. Of those calls, 26 resulted in reported assaults, six overdoses, two rapes, a sexual assault, and a stabbing, according to records reviewed by 16 News Now. Similar records obtained by BHB largely substantiate 16 News Now’s reporting.
The news of troubles at the facility reached the Indiana Division of Mental Health and Addiction five months before revoking the licenses, according to the company’s administrative law appeal documents published by 21 Alive News. Landmark Recovery was also under a corrective action plan, effective March 15, 2023, for noncompliance with state regulations on 27 issues, the same documents state.
Internal company emails obtained by WSBT 22 show that Boyle said that the company made mistakes in opening the South Bend facility that impacted the company as a whole.
“Opening Mishawaka in particular was immensely challenging,” Boyle wrote in a New Year’s reflection email. “We were not prepared to open such a large building, and frankly I did a poor job anticipating the problems we would face opening a building nearly twice as large as any we had previously tried to open, and we were not prepared to handle the influx of patients we faced.
“Our revenue cycle broke as a result of this lack of preparation. We faced a cash crunch as a result of not collecting from our insurance carriers unlike any I have faced in over ten years.”
The same email states Landmark Recovery sold two facilities for a total of $70 million and that the sales gave the company “the liquidity we have not had before to run out of business without giving up ownership of the company.”
Companies featured in this article:
