Landmark Recovery has reduced its headcount by roughly a third over the last month following the sudden shutdown of three facilities and a restructuring initiative.
At the end of August, Franklin, Tennessee-based Landmark Recovery laid off about 300 staffers who supported the operations of three Indiana-based facilities that exclusively catered to Medicaid enrollees. These facilities were closed after the Indiana Division of Mental Health and Addiction revoked three of their four facility licenses after three patients died at a facility in Mishawaka, Indiana.
About a week later, Landmark Recovery announced another restructuring. Company representatives confirmed that the move impacted about 160 roles. All told Landmark Recovery’s headcount is down by about 33% to 940 employees, including about 80 furloughs since the shutdown of the three Indiana facilities in August.
Landmark Recovery is an addiction treatment facility and outpatient services provider that was previously on track to double its footprint to 16 facilities in 2022 and have 40 facilities online by the end of 2023.
Landmark Recovery also rolled out an earlier round of layoffs in March that impacted about 70 roles in its headquarters.
The September round of workforce reductions came on the heels of Landmark Recovery losing its initial appeal to the Indiana state government to regain licensure and reopen the facilities.
On Sept. 1, an administrative law judge ruled that Landmark did not provide the requisite evidence to stay the Indiana Division of Mental Health and Addiction’s decision to revoke the license for three of Landmark’s four facilities. It still operates an addiction treatment facility called Landmark Recovery of Indianapolis that caters to cash-paying and commercially insured patients.
The administrative judge’s ruling on the request for a stay is not the final word on the matter. Landmark Recovery will have the opportunity to present a full evidentiary hearing before the administrative law office.
It appears that Landmark was facing some financial challenges before the closures. An email written by Landmark Recovery CEO Matt Boyle and published by WSBT 22 shows that the company suffered one such cash crunch in 2022 after opening its Mishawaka, Indiana, facility.
Financial and administrative challenges continue.
In emails obtained by BHB, Landmark Recovery says it will delay severance payments to ex-employees. It also inadvertently let go of people it meant to keep on furlough.
Landmark Recovery’s General Counsel Chris Kang said the loss of the Indiana facilities could delay severance payments by up to 60 days from when they were expected.
“I know this is a lot to take in,” Kang wrote. “We promised separation pay, and we will do everything we can to keep that promise.”
Chief Operating Officer A.J. Henry told some employees that they were not let go from the company and were still employed by Landmark Recovery but on furlough through Sept. 30.
“If you’re receiving this e-mail, you are still employed with Landmark but still on furlough,” Henry wrote. “I apologize for the confusion and wanted to personally send this email to confirm.”
In an email to BHB, Boyle said he called for the severance payment delay. He attributed the delay to his discovery of an administrative mix-up while reviewing recent payroll records. The company had included people who had quit the company in its severance payment program, against its policy for voluntary separations.
“I asked HR to pause payment of severance while we investigate what happened and who truly should have been offered severance,” Boyle told BHB. “I recognized the employees in question because I had personally appealed to get them to stay with the company, unsuccessfully.”