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EXCLUSIVE: $200 million investment will launch major science-based treatment chain

October 9, 2014
by Gary A. Enos, Editor
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A prominent Philadelphia-area real estate developer who has transformed brownfields into vibrant commercial and residential communities is spearheading an initial $200 million of investment into around a dozen new addiction treatment centers, saying he wants to elevate the treatment of addictions to the same level of quality and hospitality that he sees in treatment of other chronic illnesses such as cancer.

J. Brian O'Neill's first key hire for the organization that will be branded as Recovery Centers of America is Deni Carise, PhD, who has shaped clinical transformation at two of the largest for-profit and nonprofit substance use treatment chains and will leave CRC Health Group at the end of this month to become the new for-profit venture's chief clinical officer.

O'Neill's investment group, which includes affiliated investors and his own family money, will initially finance 11 to 15 treatment facilities serving a swath of the Northeast from Maine to southern Virginia. Eleven properties, ranging from estates to business and conference centers and currently vacant, already have been acquired in five states: Massachusetts, New York, New Jersey, Pennsylvania and Maryland. The initial round of facilities is expected to be completed over a three-year period.

O'Neill, who says that as a young adult he fell into helping one individual with an addiction and soon found himself working to get many others into treatment, minces no words about what he has seen in his encounters with the treatment industry.

“I've always been appalled at the level of treatment and hospitality and the condition of the majority of treatment centers in the United States,” he says. “It's surprising to me that so many people have to get on a plane to California, Arizona or Florida to find an open bed.”

O'Neill says he seeks to establish a national brand of top-quality facilities, but one that emphasizes local access to care, allowing communities of patients to receive treatment and pursue long-term recovery together—rather than become scattered across the country post-treatment.

“We want to make up to five years of treatment affordable, with sober living on our campuses, step-down services, and opportunities for enhanced technology to stay in contact with our patients,” he says.

Asked if his initial interest in addictions stemmed from a personal connection with the illness, O'Neill quickly replies, “I grew up in the '70s—of course addiction has been a prominent issue in my life. A large group of my friends have struggled with alcohol and drug addiction. I've also seen many deaths of friends and relatives.”

Carise's role

O'Neill, who heads O'Neill Properties Group, was introduced to Carise by A. Thomas McLellan, PhD, at a time when McLellan was CEO of the Treatment Research Institute (TRI) and had convened a meeting with a number of investor groups that had been eyeing the addiction treatment industry. Carise and McLellan are divorcing; Carise and O'Neill both say that McLellan, who will serve in an advisory role for Recovery Centers of America, recommended Carise to run the clinical operation without hesitation.

Carise, who joined CRC in early 2013 as deputy chief clinical officer after coordinating development of clinical toolkits as the nonprofit Phoenix House's chief clinical officer, says she had been achieving a great deal at CRC and had not been looking to move. “After doing so many turnarounds, to have this opportunity to start from scratch and to say, 'This is what the science says about best practice,'” that is what she says attracted her to the new venture.

On the occasion of a follow-up meeting with O'Neill and his second in command, Carise came away impressed with his assessment of the need in the treatment field. “He wanted to set up systems that would treat addiction like cancer, with the highest level of science, the best level of care, the best hospitality,” she says.

O'Neill says patients with addictions should be housed in comfortable rooms, with access to customized meals and an overall compassionate environment of care. Yet O'Neill and Carise add that they do not expect their facilities' price point to be at the highest end of the industry, and they anticipate their revenue mix to include both self-pay and private insurance sources.

Carise says the individual facilities likely will have 50 to 200 beds and will offer a continuum of services. She expects the clinical program will meld a variety of evidence-based practices, such as cognitive-behavioral therapy (CBT) and relapse prevention, but also will feature other interventions that can keep individuals engaged in the treatment process, such as yoga and psychodrama. She expects that the company will establish wings or entire facilities for certain special populations, such as the LGBT population.

She adds that each program and each region of operations will be overseen by a medical director, and she anticipates that some patients will receive medication-assisted treatments such as buprenorphine products and injectable naltrexone. There will be a significant focus on being customer-friendly, she says, and that means eliminating excessive wait times for intakes and allowing patients and their families to visit a facility before admission.

She expects that some directions the organization will take might not sit well with other leaders in the field. “A CEO of a company who goes into treatment doesn't suddenly stop being a CEO,” says Carise. “We may give that person one hour a day where they can be online, and maybe one hour on the phone at night.”

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Indeed, the state of addictions treatment in the 21st century, despite the exciting advances in addiction neuroscience, pharmacology, imaging and the like, remains clinically, for the most part in the dark ages. The current workforce has not been prepared to meet the challenges of treatment and there is little to no incentive to pursue the necessary education and training requisite to the complexity of the illness, the expectation of co-occurring mental health and associated disorders as well as age, gender and cultural specific clinical needs, let alone the myriad of other cohort needs. There is no attraction to enter this world of addiction treatment when doing so essentially means you will be unable to live much above the poverty line especially in the northeast.

Investment must be made in our medical schools, addiction psychiatry and graduate programs and clinical training institutes, etc., to provide integrated addiction, mental health and allied field preparation. Investment must be made to insure that entering this field provides the levels of compensation necessary to support oneself and a family if so desired. Investment needs to be made to attract those in recovery to pursue the necessary academic and clinical training to enter the professional workforce.

After 40 years of clinical practice in the this field, I could go on and on. We have much to do and it is an exciting time. It is a privilege to be involved. The need is great! KUDOS to the initiative!

thank you

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