A new behavioral health provider is aiming to address two of the industry’s biggest challenges: the rising cost of pediatric inpatient care and the need to develop a skilled, sustainable workforce.
Embark Behavioral Health vet Chris Perkins is launching a new youth-focused behavioral health provider dubbed Velocity. The facility, slated to open this fall, will be a teaching hospital dedicated to professionalizing the behavioral health workforce.
The Springfield, Missouri-based provider will initially focus on adolescent males aged 13 to 17, with plans to expand its scope over time. Velocity is currently operator-funded.
“We have a staffing problem in this country, in the adolescent space, it’s particularly challenging because of the unique nature of adolescent treatment,” Perkins, who will serve as CEO of Velocity, told Behavioral Health Business. “Generally, you have higher levels of dysregulation and volatility with your patient profile. You have higher regulatory standards and scrutiny, as well you should. And historically, the reimbursement rates have been so low, it’s very difficult to hire professionals because you’re not [given a] professional wage.”
The provider aims to address this challenge in two ways. The first is by making Velocity a teaching hospital for various levels of behavioral health clinicians.
“Our focus is a teaching hospital that focuses on training direct care staff, or what we call instructors first, then therapists second, nurses and mid-levels, third, and then psychiatrists in that order,” he said.
The goal is to train providers to work in an inpatient setting and, in particular, train clinicians in handling complex medical cases and profiles.
“We believe that will provide a level of legitimacy, both for our organization, but more importantly, we want to be part of systemic solutions for the adolescent and young adult treatment space at large,” Perkins said.
Velocity’s other main avenue for retaining and recruiting staff is simply paying providers more. Specifically, the operator plans to pay therapists an average of $115,000 and family coaches $80,000. Meanwhile, the average therapist in the U.S. makes roughly $75,000.
Perkins also pitches staffing ratios as a perk. The employee-to-occupied-bed ratio is set at 4.25 to 4.5 staff members per patient.
Controlling costs
The second major challenge the provider aims to address is the high cost of inpatient care for adolescents through a new family-centered approach.
“The cost trajectory of inpatient treatment is unsustainable, and so there are only two ways to control costs,” Perkins said. “You can either control the front end, which is your daily rate, or you can control the back end, which is the length of stay. We as providers have a very difficult time controlling the front end because the cost of the raw ingredients are mostly out of our control..The labor market, inflation insurance, all those things we can, however, impact the length of stay.”
Perkins noted that in response to these pressures, there is an increase in short-term residential programs, which last from 30 to 90 days. However, these types of programs are often too short for higher levels of complexity and acuity, he said. Still, longer programs that treat children for 12 to 16 months are unsustainable–both financially and from a social perspective.
Velocity proposes an accelerated four- to six-month inpatient program, combined with a six-month integrated family coaching program, following inpatient discharge. Perkins noted that the family coaching program is offered at no charge to parents or payers, as it is included in the daily rate at the front end of care.
“If during those six months of post-transition treatment, your child relapses and needs to come back into residential treatment, we will bring them back for up to 60 days for free,” Perkins said.
The price is $1,700 a day for in-person care. The provider will initially operate on a cash-pay model; however, Perkins said the goal is to transition to in-network status with providers through value-based care contracting.
Until then, Perkins noted that the provider will be working on a private pay with insurance advocacy model.
“We believe that based on the level of acuity and complexity that we’re treating, the level of our staffing model, and just the fact that we have psychiatry on site … that’s going to provide parents a lot of ammunition in an out-of-network situation to justify payment for treatment,” he said.
The launch of this residential program contradicts the industry trend, as most operators are shifting toward intermediate levels of care, such as partial hospitalization programs (PHPs) and intensive outpatient programs (IOPs). Perkins noted that this rise in intermediate levels of care is a response to the old systems, which only had outpatient services or residential treatment.
Still, residential is the most appropriate type of care for the patient population that Volocity is looking to treat. And the provider is looking to expand its residential efforts in 2027.
