Acadia Healthcare Enters Into a Joint Venture Partnership With Ascension Seton to Expand Behavioral Health Services in Austin, Texas

Rhea-AI Summary

Acadia Healthcare Company, Inc. (NASDAQ: ACHC) forms a joint venture partnership with Ascension Seton to expand access to behavioral healthcare in Austin and surrounding communities. The partnership will focus on expanding operations at Cross Creek Hospital and constructing a 106-bed expansion of the acute behavioral hospital, increasing the total licensed bed count to 196 upon completion. The new hospital, named 'Cross Creek Hospital together with Ascension Seton,' will be a training site for students, residents, and fellows from Dell Medical School at The University of Texas at Austin. This is Acadia's second joint venture partnership with Ascension, and the company now has 21 joint venture partnerships with premier health systems across the United States.

Insights

Healthcare Industry Analyst

The partnership between Acadia Healthcare and Ascension Seton represents a strategic move to address the growing demand for behavioral healthcare services in Austin, Texas. The expansion of Cross Creek Hospital by 106 beds is a significant development, as it nearly doubles the facility's capacity. This action reflects the broader industry trend towards increasing inpatient capacity to meet the surge in mental health needs, which has been exacerbated by the COVID-19 pandemic.

From a business perspective, the partnership leverages Acadia's expertise in operating behavioral health facilities with Ascension Seton's integrated healthcare network. This synergy could lead to improved patient outcomes and operational efficiencies. Acadia's commitment to expanding access is evident in their growing portfolio of 21 joint venture partnerships, which may enhance their competitive positioning and market share in the behavioral health sector.

Stakeholders should note that such expansions typically involve significant capital expenditure but can lead to increased revenue streams over time. The long-term success of this venture will depend on the effective integration of services and maintaining the quality of care amidst expansion.

Financial Analyst

Acadia Healthcare's joint venture with Ascension Seton is a strategic initiative that could have a positive impact on ACHC's financial performance. The construction of a new 106-bed facility represents a substantial investment in Acadia's infrastructure. Upon completion, the increased bed count to 196 could potentially drive higher revenue through increased patient admissions.

Investors should consider the capital expenditure required for this expansion and the potential return on investment. The timeline for the completion of the new facility in late 2024 suggests that any financial impact will be medium to long-term. It's also worth noting that joint ventures can lead to shared financial risk and rewards, potentially smoothing out volatility in financial performance.

Acadia's track record with previous joint ventures, such as the one with Ascension Saint Thomas, may provide investors with confidence in the company's ability to manage and execute such partnerships effectively. The expansion should be monitored for its ability to meet projected growth and for the impact it may have on Acadia's overall financial health.

Mental Health Policy Expert

The collaboration between Acadia Healthcare and Ascension Seton is a response to the critical need for mental health services, which is a pressing issue in healthcare policy. The decision to expand inpatient behavioral beds addresses the gap in mental health infrastructure, aligning with public health objectives to improve access to care for mental health conditions.

Training sites for students and residents from Dell Medical School at The University of Texas at Austin at the new facility underscore the importance of education in the mental health profession, which could help mitigate the shortage of mental health professionals in the long run.

For policymakers and public health officials, this joint venture serves as an example of how private entities can collaborate with educational institutions to bolster the workforce and infrastructure needed to meet the mental health needs of a community. The focus on serving vulnerable populations aligns with broader healthcare policy goals to improve equity in access to care.

FRANKLIN, Tenn.--(BUSINESS WIRE)-- Acadia Healthcare Company, Inc. (NASDAQ: ACHC) today announced that it has formed a joint venture partnership with Ascension Seton, one of the leading, integrated healthcare systems in Austin, Texas, and a part of the Ascension national health network. The partnership will expand access to behavioral healthcare in Austin and surrounding communities.

The joint venture will focus on expanding Acadia’s current operations at Cross Creek Hospital, as well as the number of inpatient behavioral beds available in Austin. Acadia will construct a 106-bed expansion of the acute behavioral hospital, increasing the total licensed bed count to 196 upon completion. Slated to open in late 2024, the new hospital will be named “Cross Creek Hospital together with Ascension Seton.”

The joint venture hospital will be in close proximity to Ascension Seton hospitals and will be one of the training sites for students, residents and fellows from Dell Medical School at The University of Texas at Austin.

This is Acadia’s second joint venture partnership with Ascension, having developed and opened Ascension Saint Thomas Behavioral Health Hospital in Nashville, Tennessee, in 2020. Ascension Seton selected Acadia as their joint venture partner in Austin because of Acadia’s shared commitment to high-quality, compassionate, mission-driven care to improve the health of the individuals and communities they serve. Ascension Seton’s decision was further solidified by Acadia’s proven track record in joint venture partnerships and the existing relationship with the health system.

“We are proud to expand our strong working relationship with Ascension,” said Chris Hunter, chief executive officer of Acadia Healthcare. “Through this joint venture, our organizations will partner in the delivery of high-quality behavioral healthcare to promote health and healing in the Austin community. With this announcement, Acadia now has 21 joint venture partnerships with premier health systems. We will continue this successful strategy to expand access to behavioral healthcare across the United States.

“This hospital will be a tremendous resource for those living in our community, including those who are most vulnerable, and we’re thrilled to bring together the expertise and capabilities from our two great organizations,” said Andy Davis, president and chief executive officer of Ascension Texas. “Acadia has an established track record of expanding access to high-quality, compassionate care in communities across the country. This joint venture will build upon our expertise while increasing the number of behavioral health beds and other behavioral health services available to patients throughout the region.”

About Acadia Healthcare

Acadia is a leading provider of behavioral healthcare services across the United States. As of September 30, 2023, Acadia operated a network of 253 behavioral healthcare facilities with approximately 11,100 beds in 39 states and Puerto Rico. With approximately 23,000 employees serving more than 75,000 patients daily, Acadia is the largest stand-alone behavioral healthcare company in the U.S. Acadia provides behavioral healthcare services to its patients in a variety of settings, including inpatient psychiatric hospitals, specialty treatment facilities, residential treatment centers and outpatient clinics.

About Ascension Texas

In Texas, Ascension operates Ascension Providence in Waco and Ascension Seton, which includes Dell Children’s Medical Center, the region’s only comprehensive children’s hospital and pediatric Level I trauma center, and Dell Seton Medical Center at The University of Texas, the region’s only Level I trauma center for adults. Ascension Seton partners with Dell Medical School at The University of Texas at Austin and shares a common vision of transforming healthcare through a focus on quality and value. Serving Texas for more than 120 years, Ascension is a faith-based healthcare organization committed to delivering compassionate, personalized care to all, with special attention to persons living in poverty and those most vulnerable. Ascension is one of the leading non-profit and Catholic health systems in the U.S., operating 2,600 sites of care – including 139 hospitals and more than 40 senior living facilities – in 19 states and the District of Columbia. Visit www.ascension.org and www.dellchildrens.net.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240109059292/en/

Gretchen Hommrich

Vice President, Investor Relations

Acadia Healthcare

(615) 861-6000

Source: Acadia Healthcare Company, Inc.

FAQ

What is the joint venture partnership announced by Acadia Healthcare Company, Inc. (NASDAQ: ACHC)?

Acadia Healthcare has formed a joint venture partnership with Ascension Seton to expand access to behavioral healthcare in Austin and surrounding communities.

What is the focus of the joint venture partnership?

The partnership will focus on expanding Acadia's operations at Cross Creek Hospital and constructing a 106-bed expansion of the acute behavioral hospital.

How many joint venture partnerships does Acadia Healthcare Company, Inc. (NASDAQ: ACHC) have across the United States?

Acadia Healthcare now has 21 joint venture partnerships with premier health systems across the United States.

When is the new hospital expected to open?

The new hospital is slated to open in late 2024.

What is the name of the new hospital?

The new hospital will be named 'Cross Creek Hospital together with Ascension Seton'.

Why did Ascension Seton select Acadia as their joint venture partner in Austin?

Ascension Seton selected Acadia as their joint venture partner in Austin because of Acadia's shared commitment to high-quality, compassionate, mission-driven care to improve the health of the individuals and communities they serve.

What is the significance of this joint venture partnership for the Austin community?

This joint venture partnership will build upon the expertise of both organizations while increasing the number of behavioral health beds and other behavioral health services available to patients throughout the region.