The merger of the Hazelden Foundation and the Betty Ford Center, two of the nation's best-known addiction treatment centers, is official after clearing its final regulatory hurdle from the state of California, the organizations announced Monday.
The melding of the two addiction care powerhouses creates the nation's largest nonprofit treatment organization, which will be called the Hazelden Betty Ford Foundation.
The move comes as federal health reform measures now require insurance companies to cover substance abuse and mental health treatment for the first time, shaking up the traditional modes of residential treatment that helped turn Hazelden and Betty Ford Center into household names.
"We are now well-positioned to respond to the challenges and opportunities presented by health care reform and the rapidly changing marketplace," Mark Mishek, president and CEO of the merged organization, said Monday in a statement. "Together, we will be able to better utilize the addiction treatment field's most extensive expertise, knowledge and data to accelerate innovation in treating the chronic disease of addiction and expand our already robust national system of care."
Coming together under one name will allow the operations to cut administrative costs while bringing their brand of abstinence-based treatment into more outpatient settings, analysts said.
As a competitive strategy, the merger will enable the organizations to expand their offerings in specialty areas, such as Betty Ford's programs focused on treating chronic pain and addiction and Hazelden's expertise in treating health care professionals and young people.
The combined Hazelden Betty Ford Foundation now operates 15 sites in nine states, offering both residential and outpatient services, as well as the nation's largest addiction-focused publishing house, an accredited graduate school of addiction studies and an addiction research center.
Headquarters of the operation will be in Center City, Minn., where Hazelden is based.
The Betty Ford Center in Rancho Mirage, Calif., will keep its name and add the tagline: "a part of the Hazelden Betty Ford Foundation." Most other location names also will remain unchanged and will assume the same tagline.
The Women's Recovery Center on Hazelden's campus will be renamed to honor former First Lady Betty Ford's commitment to promote treatment and recovery for women.
"Mother would be pleased," Susan Ford Bales, trustee of the Elizabeth B. Ford Charitable Trust, said in a statement. "Her pioneering achievements of ensuring access to quality treatment will be expanded through the new Hazelden Betty Ford Foundation."
The two organizations began informal discussions in January 2013, and the boards formally announced the talks in June.
Consolidated revenue at Hazelden is about $140 million, with addiction-based services bringing in about $110 million a year, according to officials.
That compares with about $40 million for the Betty Ford Center.
Analysts predict that the increased access to insurance under the Affordable Care Act and likely pressure from insurers to keep costs down will make it vital for institutions such as Hazelden and Betty Ford to coordinate care.
The law will provide for expanded coverage of such things as screenings, evaluations and counseling, which the addiction industry hopes will eventually put substance abuse treatment on par with treatment of other chronic illnesses.