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The Post-Pandemic Challenge for Addiction Treatment Facilities


Despite everything we hear in the news lately, there is a silver lining to the Covid-19 cloud. For certain, the landscape of the Addiction Treatment Industry has changed and arguably, the old ways of doing business are no longer sustainable in this environment.

Despite everything we hear in the news lately, there is a silver lining to the Covid-19 cloud. Families have used this newfound time to learn new things, to grow and improve personally, and to deepen the bonds with one another. On the business front, though many companies have been traumatized by the pandemic, many have taken it as an opportunity to reinvent themselves.

No one knows for certain what the new normal will be after the pandemic. For certain, the landscape of the addiction treatment industry has changed and arguably, the old ways of doing business are no longer sustainable in this environment. Initially, the effects of the pandemic in the industry seemed to be an industry-wide decrease in census and higher operating costs associated with keeping patients safe. At the same time, industry professionals feared the isolation caused by the quarantine would cause a surge in relapses and an increase in recreational drug use and  alcohol consumption that will result in a larger population of patients that need treatment.

The challenge for most behavioral health executives is determining what to plan for; a surge in demand, a longer than expected decrease in census, or a market shift dominated by remote treatment. These challenges are exacerbated by the need to balance the economic and operational requirements “during the pandemic” with the need to adequately prepare for the opportunities and requirements of the “post-pandemic” business environment. 

Today, the cliché that “necessity is the mother of invention” has never been more true. The treatment facilities that embrace this reality by rethinking their care delivery model will not only survive, but thrive in their mission to help patients who need treatment. The principles at Ethos Treatment, LLC, an outpatient treatment company with three locations in the Philadelphia region, embraced virtual treatment at the very beginning of the pandemic.  

“Though we are still working through the challenges of virtual treatment for new patients, we are having great success with our existing patient population and we also experienced the unforeseen benefit of having fewer “no-shows,” says Brendan Young, a founder and principal at Ethos. “We also focused all our internal resources on our core clinical requirements so we could maintain a high level of patient care and lean on our vendor partners for our financial clearance and other non-core operational requirements. This has produced great results for our patients and our business so we plan to continue many of these initiatives beyond the quarantine."

A common theme amongst treatment facilities that are adapting well to the current environment is focus; focus on the core pillars of patient care, operational efficiencies, and a streamlined admissions strategy. This means finding the right vendor partnerships for non-clinical requirements is a critical part of the recipe for success and the ability to adapt quickly. Recovery Unplugged, which operates six facilities offering both inpatient and outpatient services, recognized early on that the landscape had drastically changed.  

“It was clear from the start we had to re-think our strategy by focusing on patients who were within driving distance of our facilities, because flying was no longer an option,” says Kevin Scott, a principal at Recovery Unplugged.  “The pandemic was also a catalyst to re-think everything we do, so we could provide the highest levels of care at the lowest cost. Not only have we rethought all (of) our clinical models, but we also know we are heading into an environment where a significant number of our new patients will be dealing with the stress of being newly unemployed. Clearly our clinical model and our financial clearance policies need to account for this reality, so, we focus on the clinical needs and hired a well-known patient financial management company to fully manage our financial clearance strategy. Focusing on our core competencies has delivered great results for us."

A study by the Alcohol Research Documentation, Inc. of the Center of Alcohol Studies showed alcoholics experiencing highly threatening or chronic psychosocial stress following treatment are more likely to relapse than abstaining individuals not experiencing such stress. In fact, individual risk and protective characteristics would contribute to vulnerability to relapse for individuals confronted with significant life adversity, like being unemployed. Other studies have shown that exposure to stress is a common trigger to induce reinstatement of alcohol and drug dependency.

One way treatment facilities can adapt to this massive change in the patient demographic is to develop treatment techniques that foster coping skills, problem-solving skills, and social support, which play a pivotal role in successful treatment. The inevitable growth in patients who are newly unemployed requires treatment facilities to incorporate individualized treatment approaches that emphasize stress management strategies to counteract the clear connection between stress and relapse.  

Recovery Centers of America (RCA), one of the largest and most respected addiction treatment companies in the U.S., has embraced this holistic approach to treatment from its inception. RCA has always placed an emphasis on their patients’ lives post treatment, which includes their financial health as well as their physical health, so the necessary tools for adapting to this newly unemployed patient population were already in place. RCA’s mission of providing quality treatment to a million patients in need of care meant that breaking the affordability barrier for treatment had to be a top priority.  

“Under normal circumstances affordability is always a challenge for patients," says Deanna Telese, chief administrative officer at RCA. "The pandemic has emphasized this barrier and we are committed to help our patients get the care they need. We were fortunate that we got it right from the beginning. We partnered with a third-party patient financial management company to develop and manage a financial clearance strategy for our patients prior to admission that provides them with the right financial education and payment options. Our partner manages everything, including compliance, so we can focus on our core business. While the majority of our patients receive treatment that is covered in-network by insurers, this pre-admission engagement and education assists families in paying the deductible, co-insurance or co-pay portion of their care."

"This model has been especially helpful during the pandemic in helping patients who need treatment but have lost their jobs and no longer have insurance benefits. The process of understanding and affording patient financial responsibility for treatment is no longer a problem for us or our patients."

Many treatment facilities are re-evaluating their admission processes in order to be more efficient and to provide a higher level of transparency to their patients. Seabrook House in New Jersey, which has long been a gold standard in treating patients with addiction, recognized the admissions process could be burdensome for patients by requiring their admissions councilors to handle both clinical and financial conversations with patients. 

“The pandemic has made the financial conversations with patients more complex and it was increasing the time our staff was spending on the phone, which created a risk that some patient calls wouldn’t be answered,” says Matthew Wolf, vice president of Business Operations at Seabrook House. “Being transparent with our patients on both clinical and financial expectations related to treatment is a top priority at Seabrook, so, we implemented a solution with a third party where our staff handles the clinical intake and our partner manages the financial conversation and the related compliance. As a result, our census is back up, our patient satisfaction scores on the financial experience are at an all-time high, and more than 60% of patient financial responsibility is paid prior to admission."

The common theme among the most successful treatment facilities during the pandemic appears to be that they challenge the status quo and their teams are open to re-thinking everything they do in order to improve the access and quality care to their patients. This open-minded thinking allows these facilities to adapt quickly to shifts in the market. If there is a surge in demand, a prolonged reduction in census, or the need to completely change your care delivery model, is your team willing and able to adapt?  


Chris Wolfington is founder of FinPay, L.L.C.

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