On March 11, two addiction treatment projects came before the Alabama Statewide Health Coordinating Council. One was approved, the other denied. Apart from their interest in expanding access to residential treatment facilities, each had something else in common.

Both faced pushback on their proposed projects based on state-defined limits on how many treatment beds are allowed in the state. Specifically, Birmingham-based behavioral health company Bradford Health Services opposed both projects.

The state requires certain health care projects, including addiction treatment facilities, to get approved by either the Statewide Health Coordinating Council or the Certificate of Need (CON) Review Board, depending on the scale of the project and other previously planned capacity limits set by these entities. In the case of Alabama and the 34 other states, incumbent health care opportunities are given a forum to oppose upstart programs. Also, in this case, Bradford Health Services opposed the proposals to increase the state’s capacity for detox beds and residential treatment beds submitted by Spencer Recovery, the group whose project was denied, and by Longleaf Recovery & Wellness.

Generally, CON and statewide planning initiatives are meant to tamp down the inefficiencies of a free market by reducing duplicative services and basing capital expenditures on some predetermined standard of community need. However, critics say that such programs stifle competition and artificially maintain the success of incumbents who have captured certain markets.

“Additionally, many maintain there is little to no evidence that CON laws deliver on controlling health care costs, improving quality or ensuring access to health care services for patients,” according to the National Conference of State Legislatures.

In behavioral health, state oversight of the development of new health care enterprises is met with irritation by any organization seeking to expand or with appreciation by those trying to build proverbial moats around their investments, according to previous reporting.

Bradford Health Services used the public forum provided by the planning process in Alabama to register its opposition and “as a protection of our investment in the state,” Chandler Keel, chief marketing officer for Bradford Health Services, told Addiction Treatment Business in an interview.

“We’re really, really active at the state level — with our various lawmakers, policymakers, organizations — because we have been in operation since 1977,” Keel said. “Being able to speak up where we have deep roots is of importance to the organization because of our continued investment here. … Making sure that we’re continuing to be a steward to the residents of Alabama and an advocate of the environment of care across the state of Alabama is something for which we take a lot of personal pride and responsibility in.”

Keel added that this is a practice that the organization has engaged in since its founding.

Longleaf Recovery & Wellness, headquartered in Birmingham, pitched its Longleaf Lodge and Sunshine Farm project to the Alabama State Health Planning and Development Agency in January. It called for the addition of 60 addiction treatment beds, 10 for detox and 50 for residential treatment. The approval of the application effectively creates those new beds. However, Longleaf is not guaranteed to get to use those beds. The company needs to get approval through the CON process.

“In theory, anyone now can go to the CON committee and say, ‘We would like those beds now,’” Ian ​​​​Henyon, chief operations officer for Longleaf Recovery & Wellness, told ATB. “So, those beds are not specific to us. We just did the heavy lifting to get them created. It’s really not a great process.”

Longleaf Recovery & Wellness’ application went before the Statewide Health Coordinating Council last week and ultimately cleared the expansion of the state plan. Next, it will pursue a CON to use the beds it pushed to create. These project-specific reviews require a refining of focus from articulating a general need for services in a state to a specific organization being the right one to meet that need, Henyon said.

Bradford Health Services argued that there is not a need for projects like what Longleaf Recovery & Wellness and Behavioral Health Programs proposed. It cites its own facilities operating at 56% capacity in 2024 to demonstrate a lack of demand for such services. It also claims that the two projects allegedly incorrectly used the state’s need-determination formula  — called the “Mardin formula” — and overstated the need under those parameters. 

Chase Cameron, the executive director for the Spencer Recovery project, called Spencer’s of Alabama, said their application of 30 beds was to be based in a county that is well-removed from the nearest similar facility, making questions about capacity limitation irrelevant to serving that community.

“In Chambers County there is almost a vacuum of services,” Cameron said. “The nearest certificate of need-authorized substance abuse beds are about two and a half hours away.”

Spencer’s of Alabama would have eventually developed 4 detox beds, 12 crisis residential beds, 8 beds for a partial hospitalization program, and 6 residential care beds.

While Cameron expressed support for the Longleaf project, he also expressed confusion of the Statewide Health Coordinating Council’s decision.

“For me, the biggest question I’m wondering today is this: how is it that a planning agency is able to say … that Alabama does not need 30 additional substance abuse beds and then, within the same hour, decide that they do need 60 additional substance abuse beds?” Cameron said.

Now, Spencer Recovery is considering what it is going to do next. It is exploring both services that the council would approve or services that are already cleared by the state plan and not reviewing that kind of review process. Spencer Recovery’s facility was to focus on serving veterans. It partners with a nonprofit called Coast to Coast to develop the facility and its programming. It will continue to explore partnerships with other services providers to meet local veterans’ needs. It may also consider services that are open to civilians, Cameron said.