The trend of joint venture partnerships between hospitals and behavioral health care providers is on the rise, with experts predicting continued growth despite the challenges in finalizing such agreements. William Teague, managing director of VMG Health, highlighted the potential for proliferation in this model despite some recent obstacles that have slowed down the process.
Several major behavioral health joint ventures have taken place in recent years, including partnerships between Acadia Healthcare Company and Tufts Medicine, as well as Universal Health Services and Lehigh Valley Health Network. The trend of such partnerships has been steadily increasing since 2019, with larger providers like UHS and Acadia stepping in to provide capital and expertise to acute care health systems in need of behavioral health services.
Shelah Adams, vice president of corporate development at UHS, noted that many hospitals lack the resources and expertise to effectively address the needs of behavioral health patients, leading to the formation of partnerships with companies like UHS. Despite initial skepticism about for-profit providers partnering with nonprofit hospitals, UHS has successfully established 15 joint ventures with more potential deals in the pipeline.
Michael Tierney, managing director at Fifth Third Securities, explained that nonprofit health systems often lack the necessary expertise in behavioral health and see joint ventures as a way to enhance their services and provide better care to patients. In addition to UHS and Acadia, US HealthVest has also become known for its successful joint ventures in the behavioral health space.
While the process of finalizing joint ventures can be challenging and time-consuming, experts agree that the benefits outweigh the challenges. Each joint venture is structured differently, with varying equity stakes and partnership agreements, but the shared goal is to improve access to behavioral health services and provide comprehensive care to patients.
Looking ahead, experts predict a continued expansion of joint ventures in the behavioral health space, with a potential focus on outpatient solutions as well. As more providers see the value in partnering with experts in behavioral health, the trend of joint venture partnerships is expected to grow, offering new opportunities for collaboration and improved patient care in the healthcare industry.
