Rehab Centers Struggle as Covid-19 Drives Up Costs

Drug and alcohol use has risen, but the pandemic could force some treatment centers out of business.
empty chairs
Photograph: Peter Finch/Getty Images

Every hour on the hour, a staff member at the Journey Recovery Center in San Angelo, Texas, sends out a “Code 19” to everyone in the building. No matter where the nurses or staff members are in the 72-bed substance abuse recovery center, they stop what they’re doing and sanitize all the surfaces around them, wiping down tables, chairs, and door handles. Named after Covid-19, these hourly Code 19s are just one of many measures treatment centers around the country are using to try to keep their clients and staff safe.

Facilities are hiring more janitors, stocking up on personal protective equipment, and even setting up on-site PCR testing, which uses a swab from a patient’s respiratory tract to test for an active Covid-19 infection. But at the same time that administrators are investing in a host of previously unanticipated needs, they’re also limiting how many patients they can serve and watching as referrals from courts, state child protective services, and community outreach programs, many of which are now closed or operating remotely, decline. Serving fewer patients means facilities earn less revenue and could ultimately force cuts to services and staff. As anxiety, depression, and opioid use skyrocket, many administrators are wondering if they’ll be able to keep their doors open much longer, much less meet the growing need for treatment.

“It’s already hard in this country to access high-quality mental health and addiction treatment,” says Chuck Ingoglia, president of the National Council for Behavioral Health, which represents over 3,000 treatment centers across the country. “This is just making it worse.”

Like nursing homes, treatment centers are group living environments, where clients often have roommates, share bathrooms, eat in communal dining areas, and participate in group counseling sessions. Facilities are often also home to people with compromised immune or respiratory systems, which could make them more likely to contract a severe Covid-19 infection.

Adapting outpatient services, like Narcotics Anonymous meetings or counseling sessions, from in-person to virtual meetings has gone fairly smoothly for some centers, though the technology doesn’t benefit all patients equally. “We found that telehealth is not for everybody,” says Candace Hodgkins, president of Gateway Community Services, a recovery center in Jacksonville, Florida. While some patients prefer the convenience of attending meetings from home (especially those who would normally rely on public transit), others may not have access to a phones or tablet, or may not have a big enough phones data plan for video calls. Others just prefer the experience of being in the room with other people.

The federal Substance Abuse and Mental Health Services Administration has also loosened restrictions on methadone and buprenorphine, synthetic opioids that ease detox symptoms and alleviate long-term cravings. The medications are effective at treating addiction, but they can also be abused and even end up being sold on the street. Before the pandemic, both medications were tightly controlled and had to be administered in a clinic to make sure people were taking the right dose. But methadone clinics can see thousands of patients in a day, making them potential nodes for Covid-19 transmission.

Now, “stable” patients who have been on these medications for a while and have reliably shown up to appointments are allowed to pick enough doses to last 28 days and store them at home. At Operation PAR Inc., which provides addiction treatment to counties around Tampa, Ft. Myers, and St. Petersburg, Florida, nurses perform drug screens in outdoor tents and deliver medication doses to patients waiting in their cars, just like drive-through Covid-19 testing, says CEO Dianne Clarke.

But not all substance abuse treatments can be delivered at home or in the parking lot, and adapting has been both difficult and costly at residential facilities. At Journey Recovery Center, everyone in the residential and detox facility—from administrative staff to janitors, cooks, and patients—must wear face masks. No visitors are allowed, and Eric Sanchez, CEO of the Alcohol and Drug Abuse Council for the Concho Valley, which runs Journey Recovery, hired two new janitors to help clean in between the hourly Code 19 wipedowns. The staffers screen incoming patients for symptoms and, for the first time, the center won’t take anyone who arrives by bus. “It’s just too risky for us,” says Sanchez. “We’re doing everything we can to mitigate risk at the front end before they come in.” Patients have to find alternative forms of transportation and—if they show up with symptoms, or suspect they’ve been exposed to Covid-19—they have to go home and quarantine for 14 days before they’re allowed into treatment.

Other facilities have taken more drastic steps. Operation PAR reduced the number of patients they could take by half and rearranged beds and common spaces to allow for social distancing. Clark even bought sewing machines so patients could make masks for themselves, staff, and family members. Staff take patients’ temperatures twice a day and there are no visitors.

But even with those precautions, some facilities have still had outbreaks. Staff at Homeward Bound, which offers substance abuse and mental health treatment at locationss across north and west Texas, also reduced the number of people in their residential facilities by 50 percent and screen patients and other staff members before they enter the building, according to executive director Doug Denton. But in April, he says, two patients in Homeward Bound’s Dallas facility tested positive, as did several staff members. Denton says they isolated the patients and completely halted admissions into that unit, though other parts of the facility, including the detox unit and women’s unit, were able to stay open.

Then in July, he says, Homeward Bound had to completely close its El Paso residential treatment facility after eleven staff members tested positive. “We didn’t have staff to keep it open,” says Denton. “It went rampant.” No clients tested positive, so they were moved to other facilities. Staff members who tested positive are isolating at home, while those who are left are deep cleaning the facility, according to Denton. Once enough staff members test negative, the facility will reopen, but Denton estimates the two closures could cost up to $800,000 combined.

Homeward Bound has been able to keep paying all of its staff thanks to the Paycheck Protection Program (PPP), a piece of the CARES Act that gives small businesses loans to pay staff during the pandemic. If a business is able to survive without laying off any employees, the loans are forgiven. “Right now, it’s a wash,” Denton says, meaning that the federal funds have essentially cancelled out the losses from the two closures. But Denton says all these extra costs, and the reduced number of available beds, is taxing an already-stressed system. “Before the pandemic we didn’t have enough funding to handle the load,” says Denton. “That has been a lifelong concern. We don’t have enough money to address the needs out there. Now, with the reduced capacity, how are we going to meet the need?”

Treatment centers operate on a fee for service model. In exchange for providing services like detox treatment, counseling, job training and medically-assisted drug treatment (administering methadone or buprenorphine), the centers are reimbursed by insurance companies or by state or federal funding. Fewer patients means fewer reimbursements, and fewer reimbursements means the facilities have to cut staff and services. “It’s totally cyclical. These things are reinforcing each other,” says Ingoglia. “The question just becomes how long can they hold on in this kind of cycle.”

A June survey of over 600 service providers who are members of the National Council for Behavioral Health found that over 70 percent of respondents had been forced to cancel or reschedule services, or even turn away clients, during the last three months so they could maintain social distancing. At some residential facilities, instead of having two or three people share a room, now people may live alone. Staff at some facilities have also decided to keep a few rooms open in case a patient starts to show symptoms and needs to be isolated; others have had to turn patients away or defer treatment because the patient arrived showing symptoms. On average, those survey respondents reported losing nearly a quarter of their revenue and almost half said their facilities won’t survive another six months under current financial conditions.

“To keep moving revenue, you have to keep admitting new clients as well as earning money while you treat the clients that you have,” says Michael Festinger, president of Better Way of Miami, a substance abuse disorder treatment center which has reduced residential capacity by 30 percent. “The math is pretty simple.”

Like many centers, Better Way benefitted from the Paycheck Protection Program and, right now, Festinger says the organization is financially stable—even though it’s had to absorb unanticipated costs like extra overtime for staff who have to work longer hours when colleagues can’t come in because they’ve tested positive, are showing symptoms, or can’t find child care. But, he says, even for well-run, established programs, this is a difficult time. “Nobody can withstand interrupted revenue streams for an indefinite period of time, and there are certainly agencies that can’t and won’t survive under these circumstances,” he says. Festinger worries that as facilities close, other service providers won’t be able to step up and meet demand because of capacity limitations.

And not all facilities have qualified for PPP. Rosecrance, a mental health and substance abuse treatment organization that runs rehab centers in Illinois, Iowa, and Wisconsin, set up PCR testing at all of its residential sites, but was too large to qualify for PPP loans because it is a nonprofit that employs more than 500 people. John Schuster, the group’s chief financial officer, estimates Rosecrance is losing $700,000 every month because of Covid-19 costs. Administrators are optimistic the program will survive, but worried about cuts that may lie ahead. “An organization doesn’t exist for 104 years without adapting to change and adverse circumstances.” says David Gomel, president at Rosecrance. Now he’s turning to local and state grants to try and make up the difference.

At the same time that treatment center staff are reducing the number of patients they serve, overdose rates are rising. An issue brief published by the American Medical Association found that as of July, more than 35 states had reported an increase in opioid-related deaths since the pandemic started. Mental health providers are worried that the loneliness, boredom, isolation, and stress caused by the pandemic could drive many former users to relapse. According to polling released in July by the Kaiser Family Foundation, nearly 37 percent of Americans reported experiencing symptoms of anxiety or depressive disorders during June, a more than three-fold increase over the same time last year.

Crisis call lines across the country are also reporting increases in call volume. “It’s hard to be mentally well right now,” says Beverley Wohlert, CEO of Phoenix’s National Council on Alcoholism and Abuse Disorders, which operates several residential rehab facilities. For people struggling with diseases like alcoholism or drug abuse, the situation is even more difficult.

While admissions are down to accommodate for social distancing, Wohlert adds that many places that would normally refer people to treatment—courts, schools, community outreach programs—are also closed right now. Her facility has spent thousands to buy personal protective gear, vans to keep patients off of public transit, and they’ve rented out extra office space to allow for social distancing during counseling and meetings. At the same time, Wohlert says, the program hasn’t received a single outpatient referral since June 29.

There may also be some trepidation from potential patients, who are worried they’ll catch the virus while in treatment. In Texas, Doug Denton worries that some people are afraid to come into Homeward Bound’s Dallas facility because the city is currently a Covid-19 hotspot. But even with fewer people coming in, Denton believes that the need for services is still high and could be rising. “I’m anticipating a wave of admissions as fears recede and people begin to recognize they’re in trouble with their addiction,” he says. “Our goal is to be standing ready for them when they reach out.”

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