Behavioral health operator Acadia Healthcare (Nasdaq: ACHC) is executing its strategic M&A plan for 2024 with the announcement of three new acquisitions.
Franklin, Tennessee-based Acadia acquired three comprehensive treatment centers (CTCs) in North Carolina, bringing its number of CTC locations in the state to 10. The treatment centers combine behavioral therapy and medications for opioid use disorders (MOUDs) to treat opioid use disorders (OUDs).
Acadia recognized a “historic” opportunity for public entities and the private sector to expand access to care in light of the federally-funded State Opioid Response (SOR) grants and the announced opioid settlement funds, according to Dr. Nasser Khan, operations group president for Acadia’s CTC business.
“We felt that the nature of the settlement funding processes is such that funds are distributed to states and counties with some general guidelines but with a fair amount of latitude for how those funds are distributed and then deployed,” Khan told Behavioral Health Business.
The acquired CTCs are located in Raleigh, Greenville and Hillsborough, North Carolina, respectively.
Acadia targeted these specific locations after co-conducting an analysis of treatment gaps in North Carolina with the University of North Carolina’s Center for the Business of Health. The company provides UNC financial support to allow the university to work independently to develop community-based strategies to mitigate the effects of the opioid epidemic in North Carolina.
“[Acadia felt that] an academic institution such as UNC, particularly because there’s a significant opioid crisis in North Carolina, would be a good partner in order to bring independent, rigorous thinking on what are the highest ROI strategies for deploying those funds,” Khan said.
The new centers will likely achieve financial maturity in approximately two to three years, aligning with Acadia’s overall margin profile, Khan said. This timeline varies greatly across different geographies.
“[The] high degree of variability across different geographies speaks to variability in regards to regulations and different requirements and states from an operational standpoint as well as reimbursement structures,” Khan said.
North Carolina’s approach to behavioral health treatment programs makes the state an especially attractive location for expansion.
“North Carolina has been really progressive and one of the more recent states to expand access to Medicaid,” Khan said. “That goes hand-in-hand with the ability to expand access to care.”
The acquisitions align with Acadia’s 2024 strategic plan, which includes a focus on M&A to expand access to care. The company has also committed to increase the pace of de novo growth from a historic six per year to 14 in 2024.
The company is also leveraging innovative care models, such as mobile opioid treatment vans, to expand its physical capacity. The North Carolina CTC locations will serve as hubs for deploying Acadia mobile vans.
It is also seeking to leverage med units to increase capacity in light of the updates to the 42 CFR Part 8 final rule which include changes that promote practitioner autonomy and reduce barriers to receiving care.
Each of the new CTC locations will provide a comprehensive array of treatment modalities, including outpatient services, individual and group therapy, intensive outpatient programs (IOPs) and partial hospitalization programs (PHPs).
“These acquisitions build upon our existing and strong clinical foundation within the state of North Carolina,” Chris Hunter, chief executive officer of Acadia Healthcare, said in a statement. “The facilities are fully operational with strong track records of positive patient outcomes.”
Acadia operates a network of 253 behavioral health facilities in 38 states and Puerto Rico and serves more than 75,000 patients daily. The newly acquired facilities bring the company’s total number of CTCs to 160.
Acadia executives told Behavioral Health Business about two of the three acquisitions, Raleigh Methadone Treatment Center and Greenville Recovery Center, earlier this month. The locations were previously part of outpatient addiction treatment provider Sellati & Co. Inc., which also operates in Virginia.
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