10 Ways to Increase Revenue at a Substance Abuse Treatment Facility

Running any kind of medical office can be challenging.  Taking care of people’s lives, juggling regulatory compliance issues, getting insurance companies to pay, dealing with staff, etc. can all be far more complicated than the problems most other business owners deal with on a day-to-day basis.  Having recovering addicts as your clientele further compounds the stressors associated with your operation as they tend to be more unreliable, unstable and unmotivated than most other types of patients.

For as much as your patients and staff would like to think that you are running the facility to earn your place in heaven, we all know that it’s a business and it has to make money in order for it to remain operational and continue to help people.  The following strategies may or may not be practical in your operation.  Some you might have already implemented.  Hopefully I can suggest some other ideas that you haven’t thought of yet that may help.

1.    Dual Focus Programs

Very often, patients suffering from addiction have ancillary diagnoses that need to be addressed and also require treatment.  In some cases, one diagnosis can either cause or exacerbate the other diagnosis.  For example, if a patient is suffering from a mental health disorder, they may be inclined to self-medicate and become addicted to alcohol and/or other drugs.  Not only is treating both diagnoses together clinically sound, having such programs can position your facility to receive referrals from certain agencies specifically because they meet the needs of certain patients.

Conditions that can be appropriately packaged together with substance abuse treatment are as follows: 

•  Mental health disorders
• Neurological impairment
• Hearing impairment
• Eating disorders
• Offenders of domestic violence
• Victims of domestic violence
• Sex offenders
• Post-traumatic stress disorder 

2.    Special Interest Programs

As with the dual focus programs, other special programs can be designed to accommodate a particular type of patient.  Instead of addressing a primary or secondary diagnosis, the special interest could just be a certain classification, distinction or circumstance that differentiates one patient from the general population.  The following are examples of some possible special interest groups: 

• Language other than English
• Medical professionals 
• High-profile individuals
• Law enforcement professionals
•  Adolescents
• Gay/Lesbian
• DWI/DUI 

Unlike the dual focus programs, there’s no difference between treating these types of individuals and general population patients.  However, their classification or circumstance may warrant them to be segregated into different treatment groups as a more effective means of therapy.  For example, if a patient can’t speak English, placing them in a general substance abuse treatment program is pointless.  Medical professionals may have lost their license due to their addiction.  Undergoing treatment may be a prerequisite to reobtaining their licensure and certain reporting may be necessary.  High profile individuals may feel more comfortable if they are with similarly situated individuals, making their treatment more effective and their recovery more probable.  Law enforcement professionals may have a conflict of interest being integrated into the same programs with other individuals who they may have come in contact with during the course of their duties.  Adolescents may have an easier time relating to other patients their own age, rather than adult patients.  Gay or lesbian patients may feel more comfortable with other like-minded patients, making sobriety easier for them to achieve.

Recovering from addiction is challenging enough.  Removing certain obstacles from the equation gives the patient a better chance at achieving their treatment goals and focusing on the underlying causes of their addiction.  Having these special programs may attract more apprehensive patients and/or referrals, thus increasing your facility’s revenue.

3.    Sober Housing

Offering room and board to the homeless population is a service for which there is an overwhelming public need.  Many individuals who are homeless also have some type of underlying mental health diagnosis and/or substance abuse addiction.  Creating a program that is designed to accommodate this special needs population opens your facility up to an influx of referrals that will come from many sources.  The amount of homeless individuals in any region is staggering and whatever services that may be available are underutilized.  These are low functioning individuals who are unable to navigate their way through the system and need their hands held through the process.

The reimbursement for this type of room and board is usually obtainable through social service programs.  Even though the remuneration may not be particularly sizable, being able to channel this population through your treatment programs can be very profitable.

4.    Child Care

As you know, mothers can be addicts too.  However, not having suitable child care options can prevent a mother from participating in a treatment program.  Having a lower paid employee made available to tend to patients’ children can open the doors for certain female patients to attend.

5.    Plan Enrollment

Some patients may not be able to be treated at your facility because they are uninsured and cannot afford to pay themselves.  Having certain staff available to assist in the enrollment of Medicaid and other affordable health insurance programs could make the difference between your facility getting that patient or not.  You may be able to subcontract this function to third parties who receive payment by the plans themselves for providing enrollment services. 

6.    Provide Transportation

If you are treating the indigent population, some may not have the means in which to get to your facility.  They may not have a car or enough money to pay for public transportation.  This could be a very real factor for some individuals.  Purchasing or leasing a van could be a minimal expense in comparison to the revenue generated by the increased treatment sessions of patients that could not have otherwise attended without it.

7.    Donate Space to Self-Help Groups

Chances are, there is available space at your facility that is unused at certain points of the day or evening.  Allowing certain groups such as Alcoholics Anonymous to utilize this space for their regularly scheduled meetings could raise awareness of your facility to the very same demographic you market to and want as patients.  Even if a potential patient is aware of your location, being there for AA meetings might encourage them enough to inquire about your facility’s treatment programs. 

8.    Develop Qualified Service Agreements

Networking with other facilities and healthcare professionals that may provide different but yet related treatment services is important.  There may be mental health providers or medical facilities in your area that are not qualified or licensed to treat patients for substance abuse.  If they are able to identify an addiction or dependency diagnosis, they have a legal obligation to make an appropriate referral if they cannot provide treatment for that particular condition.

A QSA is a non-binding agreement that basically states, we’re here and you’re there.  We’ll referral patients to you when we come across individuals who require your services.  This type of agreement doesn’t require the facility to refer such patients to your facility.  However, it merely states that if a patient is in need of the type of treatment that you provide, your facility is on their list of possible agencies that they could refer to.  In some cases, it’s required to have these agreements in place, rather than a facility not having a well-defined plan as to where they can refer patients to if they lack the licensure or capability of treating them.

Seek out any health care facility or professionals who you think could come in contact with individuals suffering from addiction.  These could be emergency rooms, private practitioners, primary care physicians, mental health facilities, crisis centers, urgent care facilities, etc.  This is a good way to formalize a referral relationship.

9.    Offer Patient Incentives

Patients respond to positive actions too.  Some of your patients might genuinely want to get better but unfortunately, a large portion of the patients at your facility might only be there because they were forced by a law enforcement agency to undergo treatment as a provision of their parole or a condition of their probation.  Many substance abuse patients are unmotivated.  Part of this may be a treatment issue.  However, there may be ways of offering incentives for them to attend treatment.

For example, if you’re running an outpatient program, offer your patients a discount on their co-payment if they attend a certain number of consecutive treatment sessions.  If they don’t have a co-payment, offer them a gift certificate for a free cup of coffee or a small amount at a local fast food establishment.

No one has ever been hurt from a little incentive.  It may cost your facility a $5 copay ever few visits or a $5 gift card but this is less than you will be receiving from the insurance company to actually treat the patient.  Undergoing substance abuse treatment is a monumental task that is difficult for even the most tenacious of souls.  A little reward goes a long way.  Even if it’s not monetary.  If you think gift cards or monetary incentives are too tacky for your operation, think of another incentive that is more appropriate.  You’ll be surprised how this will increase attendance. 

10.  Renegotiate Your Contracts

Depending on how long it’s been since you initially entered into a contractual relationship with an insurance company or managed care company, you may want to consider contacting them to renegotiate higher reimbursement rates.  Even insurance companies understand the concept of cost-of-living increases and some of them may be willing to make incremental adjustments to your fee schedule.  Some companies may fight you on this but it doesn’t hurt to ask periodically.

For more information about increasing revenue at a substance abuse treatment facility, please call Ashlar Consulting Corporation at 305-849-9399 or visit www.AshlarConsultingCorp.com.  

How Sober Housing Can Boost Revenue for Treatment Centers

Patients suffering from alcoholism and other drug addictions are different from other patients in any other area of the medical industry.  When someone breaks a leg or gets the flu, they voluntarily go to the doctor because they want to get better.  In many cases, alcoholics don’t want to stop drinking and drug addicts don’t want to stop doing drugs.  In fact, if it wasn’t for law enforcement agencies giving these individuals the option of either going to treatment or going to jail, drug treatment centers would be far less successful.  Not at treating patients, but in generating revenue.

Substance abuse patients can also be unreliable.  If they’re not particularly motivated, they may decide not to go to their regularly scheduled treatment session.  If they don’t show up, the treatment facility can’t bill for their services, which translates to a loss of revenue.  From a business perspective, this is a problem.

From a clinical perspective, we all wish we could motivate our patients to commit to their treatment program and get the help they require.  Unfortunately, as we all know, many patients have to hit rock bottom before they get to that point.  For some addicts, incarceration or death catches up to them before they do.  For as sad as that is, it’s a reality that everyone in this field faces. 

For as much as the patients want to think a treatment professionals provide services out of the goodness of their hearts, we all know that operating a rehab center is a business and it needs to make money in order to stay in operation long enough to continue to provide services.  With the unreliability and lack of motivation patients have, how can treatment agencies make up for the loss in revenue?

Substance abuse treatment centers rely on referral sources to send patients their way.  Referral sources might be hospitals or other medical facilities, doctors, therapists, employee assistance programs, law enforcement agencies such as the Department of Probation or the Division of Parole, etc.  All of these entities are important to the survival of every rehab center in terms of where their patients come from.  However, what if a substance abuse treatment center was able to refer patients to itself?

The best way to make this happen is through residential programs.  There are a few names for them: sober homes, halfway houses, recovery residences, etc.  Regardless of the name, a sober home is a residence where recovering addicts live temporarily while undergoing treatment.  There are certainly upscale sober homes where the patients/residents have the means to pay out-of-pocket.  However, the indigent population can really make this business model successful.

Most homeless people are homeless because they have some type of mental health and/or substance abuse addiction that is distorting their ability to live normal lives.  Individuals without mental illnesses or drug addictions have an easier time fending for themselves by having a job and paying their bills.  However, if the patient is less functioning and doesn’t have family members willing to care for them, these individuals are at risk of becoming homeless.  Unfortunately, the homeless population in many areas is enormous and there aren’t enough programs available to provide assistance.

Having a sober home that provides a safe, sober living environment for homeless individuals to achieve recovery opens up many opportunities to receive referrals from many different agencies.  Moreover, it assists in the treatment process by stabilizing the patient.  Recovery is more obtainable when the patient isn’t worried about food and shelter.

The ideal sober house could be anything from a single family home to a larger residential facility such as a former adult home, dormitory, hotel or similar living quarters. From a legal standpoint, the U.S. Supreme Court has classified addiction as a disease and unrelated individuals have the legal right to live in a single family dwelling if they are all recovering addicts because they share the same common interest, that being recovery.  This makes them what is considered to be an unconventional family.

In most counties, the Department of Social Services will pay for room and board.  It’s a small amount per resident that will barely cover expenses so there isn’t much money to be made through the actual sober home itself.  However, once you have these homeless individuals living in your residence, you have much more control over them.  When you send your van to pick them up to go to treatment, they have a choice of either getting in that van or being asked to leave the residence. Now you don’t have to worry about a lack of motivation or patients not showing up for treatment.  The real money to be made is on the treatment side, not the residential.  However, the residential component will make it possible to increase treatment attendance.

With no income and no assets, these patients normally qualify for Medicaid which is how this program will pay off financially.  With a residence full of patients that are attending your intensive outpatient program 3, 4 or 5 days per week, the combination of treatment and housing could be very profitable.  In addition to being profitable, this type of program is clinically sound.  Patients have a much higher chance of recovery when they’ve been removed from the setting that was exacerbating their addiction.

In many sober homes, the residents care for themselves.  They cook, clean, do their own laundry, maintain the grounds and learn how to live like a normal person.  Some may be so low functioning that they’ve never learned how to care for themselves in the first place.  Living in this type of residence will be an excellent experience for them.  This will also keep costs down.

Addicts tend to internalize their experience and feel that they’re the only ones going through the difficulty they are experiencing.  Being around other recovering addicts will make them realize that they’re not alone.  There’s also another fascinating dynamic that occurs in this kind of setting.  If one of the residents relapses, the other residents come down very hard on them, knowing that the relapse jeopardizes all of their recovery efforts.  This keeps a good check and balance within the residence and keeps everyone in line.

It is common for these type of residences to have what’s referred to as a house manager.  The house manager is usually a former patient who has completed the program.  He/she lives in the residence rent-free in exchange for making sure the residents are in compliance with all house rules.

Community opposition is something to take into consideration.  If your sober home is located in the middle of a densely populated residential area, don’t expect the community to be happy about it.  They will complain to their local officials and try to shut you down.  This is something that needs to be thought out carefully.  Even though this type of operation is totally legal, the political heat could be enormous.  The stigma for alcohol and drug abuse is difficult to deal with on a community level.  Everyone feels there should be places to help drug addicts but most people don’t want them in their town.  It is best to find a residence that is somewhat secluded.  If this is not possible, try to get the support of the local officials prior to moving forward with that location.  Meet with the town’s Mayor or other government officials to make sure you have their support, despite the possibility of community opposition.  If you don’t, they will make your life hell and you will be paying more in legal fees to defend your position then you will make from this venture.

If you are successful at having a sober home combined with your treatment program, you will not only be running a profitable operation but you will have a system that turns dysfunctional, homeless individuals with mental health and substance abuse problems into healthy, well-adjusted members of the community.  Having aftercare programs in place to help your residents find permanent housing and employment after your program will ensure the patients’ success rate and strengthen your position within the community.  If done right, this can be both a highly profitable and clinically appropriate way of enhancing an outpatient substance abuse treatment operation.

For more information on setting up this type of sober home to compliment your treatment program, please call Ashlar Consulting Corporation at 305-849-9399 or visit www.AshlarConsultingCorp.com.