Addiction Treatment Industry Newswire |
![]() ![]() Gateway’s Crossroads
Grant Writing Culture Since its founding in the early 1960s, Gateway has been a publicly funded treatment provider, and thus its financial underpinnings were driven primarily by the culture of grant writing. But in 2008 the Gateway board handed CEO Michael Darcy a startling mandate – ramp funding from zero to one-third commercial insurance or face the possible implosion of an institution that delivered the lion’s share of addiction treatment services in the nation’s fifth most populous state. Behind the dire forecast was the financial shambles that was, and remains, the condition of the state government in Springfield and, to a much lesser extent, also the city Five Years Later
Raymond James For Darcy’s part, he is over the near term more than content to remain focused on working the footprint A Question of Tactics If Darcy and the Gateway board decide on growth by acquisition as a strategic option – given the overwhelming need for managerial expertise on the public side of the treatment business, at least a $20B a year marketplace with many thousands of providers, does Gateway have a duty to grow by acquisition? – then it becomes largely a matter of tactics. Some of the heavy lifting has already been done as regional powerhouses have emerged in the last couple of years, formed by large behavioral health mergers in Western and Northern Florida, Texas and the Mid-Atlantic states. Should Gateway acquire one of those and take on the role of becoming a major aggregator nationally of public behavioral health assets? All the while, of course, bearing mind such deals would take Gateway big time into straight up mental health – given our knowledge now of addictions and mental illness comorbidity is there even such a thing? – and away from its current laser specialty focus on addictions care. Or should a more modest regional approach be taken, where Gateway remains strongly focused on addictions only but, for example, might start aggregating in regions that are relatively prosperous and nearby like Southern Michigan/Northern Ohio with plenty of acquisition candidates and, especially in the case of Ohio, that have state governments and governors that are loudly espousing the need for more treatment and putting their money where their mouth is? read our report on a major merger in Northern Florida read our report on a major merger in Western Florida read our report on a major Baltimore Merger read our report on the merger of Texas’ Two Largest Non-Profit Providers POST YOUR COMMENTS BELOW… start a debate! Got Addiction News? …TELL US! |