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Acadia Healthcare (ACHC) Inks JV to Boost Chula Vista Presence

Acadia Healthcare Company, Inc. ACHC recently entered into a joint venture (JV) with California’s renowned integrated healthcare system, Scripps Health, for operating an inpatient behavioral health hospital in the Eastlake community of Chula Vista. The Chula Vista Planning Commission recently sanctioned the planned facility, which is expected to commence operations in 2025.

The new facility resulting from the JV between Acadia Healthcare and Scripps Health will provide a comprehensive portfolio of inpatient behavioral healthcare services to adults, adolescents and seniors suffering from severe behavioral health issues. Besides, the hospital will house 120 beds. ACHC plans to add a specialty unit, which will cater to the behavioral health treatment of active-duty military and veterans.

Initiatives similar to the latest one reinforce the faith that healthcare providers put on Acadia Healthcare as a JV partner. This largest stand-alone U.S. behavioral health provider has proven its credibility in offering specialized care to patients in need of the same. ACHC operates a network of 230 behavioral healthcare facilities in 40 states and Puerto Rico as of Sep 30, 2021.

Via the recent move, Acadia Healthcare, which carries a Zacks Rank #3 (Hold), intends to cater to the acute shortage of inpatient behavioral health beds throughout Chula Vista and South County. Per the California Hospital Association, per 100,000 people, 50 inpatient beds are required to effectively serve the San Diego County population. However, while the county needs around 1,650 beds to address the need, it has only half of the required amount, which is concerning. Thereby, the jointly operated facility by ACHC-Scripps Health can capitalize on the prevailing scenario.

Scripps Health seems to be a suitable partner for complementing Acadia Healthcare’s endeavors since the former remains one of the well-established integrated healthcare systems headquartered in San Diego, CA.

Having said that, the latest JV seems to have come at an opportune time as mental health issues have been troubling Americans for a while now. The COVID-19 pandemic further aggravated the insecurities and fears. This has resulted in higher demand for enhanced behavioral health services, which offers Acadia Healthcare the perfect opportunity to capitalize on. Per Fortune Business Insights, the behavioral health market of the United States is anticipated to witness a CAGR of 3.6% over the 2021-2028 period.

Apart from Acadia Healthcare, healthcare providers like HCA Healthcare, Inc. HCA, Universal Health Services, Inc. UHS and Magellan Health, Inc. MGLN offer high-quality behavioral healthcare services and can capitalize on robust demand for these services.

HCA Healthcare operates as one of the leading U.S. acute care psychiatric providers. Behavioral health services remain one of the fastest growing business lines within HCA. The healthcare provider continues to collaborate with hospital affiliates for better management of behavioral health services. Making use of clinical resources and geographic presence, Universal Health Services enters into mutually beneficial collaborations with other healthcare systems. This has helped UHS to deliver enhanced and affordable behavioral healthcare services, thus resulting in better outcomes for patients.

Magellan Health follows an integrated approach of catering to the behavioral, physical and pharmacy needs of people. MGLN has been either launching clinical solutions and programs or else partnering with well-established healthcare providers such as Invo Healthcare, Livongo Health and Neuromotion to drive its endeavors. This has strengthened Magellan Health’s behavioral health services portfolio and bolstered its nationwide presence.

Coming back, Acadia Healthcare continues to pursue JVs with established healthcare organizations. These alliances have diversified ACHC’s treatment network and strengthened its national presence.  Such efforts have also enabled the healthcare provider to reach out to underserved communities.

There are several JV projects lined up in Acadia Healthcare’s pipeline. The year 2022 is likely to be the strongest year with respect to JVs for ACHC.

Shares of Acadia Healthcare have gained 53% in a year compared with the industry’s rally of 50.1%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Image Source: Zacks Investment Research

While shares of HCA Healthcare and Magellan Health have gained 48.4% and 14.5%, respectively, in a year, shares of Universal Health Services have lost 5.3% in the same time frame.


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Universal Health Services, Inc. (UHS): Free Stock Analysis Report
 
HCA Healthcare, Inc. (HCA): Free Stock Analysis Report
 
Magellan Health, Inc. (MGLN): Free Stock Analysis Report
 
Acadia Healthcare Company, Inc. (ACHC): Free Stock Analysis Report
 
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