When Therapeutic Communities of America (TCA) changed its name to Treatment Communities of America two years ago and opened up its membership to non-TCs, the move was viewed as a way to cope with healthcare reform, which was already seen as moving substance abuse treatment away from reimbursement for residential treatment (see ADAW, December 6, 2010). However, TCA has not given up the fight for residential, and now with Affordable Care Act (ACA) implementation on the horizon, officials say TCs are well positioned for changes in funding streams.

But there are still concerns about the viability of the TC model, which has traditionally been one of long-term residential treatment in which patients take control of all areas of their lives. In a sense, that model may itself be outdated, because many TCs now do so much more, including involvement with criminal justice, housing and educational systems, said Norwig Debye-Saxinger, vice president for government affairs at Phoenix House and a member of the TCA public policy committee.

Not all medical

TCs do provide more than medical treatment, so it makes sense that there would not be any insurance coverage from the healthcare side for all of the services, said Debye-Saxinger. “We do social habilitation, educational services and all kinds of things that shouldn’t be supported by Medicaid,” he told ADAW. “It’s not as if residential treatment should be lock, stock and barrel part of the ACA — there are too many social and other components.”

But that doesn’t mean residential treatment and those other services aren’t crucial to recovery, said Debye-Saxinger. “If I’m a homeless person living in a tunnel in New York City, I can go to any outpatient program and get my substance use disorder treatment paid for,” he said. “But if I want to get my act together and be under a supervised regimen, Medicaid won’t pay for that.”

So TCs are adapting to the new environment. For example, Phoenix House runs a detoxification program that is outpatient. Patients are offered the option of enrolling in a residential program while they are going through detox — and this has been very successful, said Debye-Saxinger. “If you engage them in treatment while they’re in detox, 91 percent stay in treatment,” he said. “We do need more community-based detox, which will also enroll the patient in the next level of treatment.”

TCs also use medication-assisted treatment, including with methadone. “It’s not what it used to be,” he said of the TC modality, which started out as drug-free.

Daytop bankruptcy

Another issue that seemed on the surface to signal TCs’ possible demise was the bankruptcy of Daytop Village, a TC founded in 1964 by Monsignor William P. O’Brien. The venerable TC filed for bankruptcy last spring (see ADAW, May 14, 2012), but the picture was looking better last fall, after it sold a valuable piece of real estate in Manhattan (see ADAW, December 3, 2012).

“Daytop was in financial trouble for five years or more, and it had nothing to do with the state of TCs,” Debye-Saxinger told ADAW. “It was really associated with their longtime leader, Monsignor O’Brien, not being fully capable of running the program anymore due to health issues.” With the money from the sale of the Overseas Press Club building being used to settle any debt, and a “more streamlined” operation now in process, Daytop Village is in a good position again, said Debye-Saxinger. There have been layoffs, however, because “when programs go through something like this, they sometimes lose referral agents, and it’s difficult to crawl your way back up,” he said.

The bankruptcy of Daytop Village is tame news compared to past scandals involving TCs — scandals from which those TCs have recovered healthily. For example, consider Odyssey House 20 years ago, when founder Judianne Densen-Gerber, M.D., was investigated by New York state for the misuse of public funds. She subsequently resigned her position, and Odyssey House has for years been thriving under the direction of President and CEO Peter Provet, Ph.D.

“I wouldn’t read anything into a bankruptcy,” said Debye-Saxinger.

(Gregory Bunt, M.D., of Daytop Village tried to return our calls, but we were unable to connect by press time.)

The idea that payment streams may limit residential treatment funding in TCs does not hold true, at least in New York, said Debye-Saxinger. About 40 percent of residential treatment center services in New York are paid for by the state, which covers room and board with no time limit, he said. In New York City, the Human Resources Administration monitors program participation, and many people are in Daytop as a condition of eligibility for welfare, he said. “If they fail in outpatient, they have to go to residential, and if they fail in residential, they are kicked off welfare,” he said.

IMD exclusion

The fundamental problem with the ACA and residential treatment for TCs is the Institutions for Mental Disease (IMD) exclusion, which prevents Medicaid from paying for residential facilities that are 17 beds or more, said Debye-Saxinger. “As Medicaid becomes the primary source of support for all the states for substance abuse and primary healthcare under the ACA, being left out of that picture certainly creates challenges,” he said.

Ultimately, the situation will be different in every state, and maybe even in every locality in some states, said Debye-Saxinger. “It’s not really what Americans might expect as national healthcare reform, because it’s going to be so localized,” he said of the ACA.

“In Washington, TCA has been actively advocating to ensure that patients continue to have access to residential treatment as the Affordable Care Act is implemented,” said Sushma Taylor, Ph.D., president of TCA. “We have been working on our own and with other SUD treatment advocacy organizations to ensure that patients have access to the full continuum of care for SUD, including residential treatment for people who need it, as part of the Essential Health Benefits.”

Even after implementation of the ACA, TCs plan to ensure that patients who don’t have insurance coverage, either through Medicaid, health insurance exchanges or their employers, can access residential treatment through the Substance Abuse Prevention and Treatment (SAPT) block grant, said Taylor, who is also president and CEO of Center Point in California.

TCA members have also been working aggressively at the state level to ensure continued and expanded access to residential treatment, said Taylor. For example, in Louisiana and New York, TCA members have worked to ensure that state and municipal tax levy support (such as public assistance and non-federal participatory Medicaid as well as federal Medicaid for residential services to adolescents) remains available or becomes available to support residential treatment, said Taylor. “It is notable that Medicaid SBIRT services, as well as Medicaid step-down services, are also beginning to play a significant role in supporting and integrating the residential services systems,” she said.

Stay tuned as the ACA, exchanges and Medicaid expansion continue to roll out.


Carise’s move to CRC soft-pedaled by Phoenix House

The recent departure of Deni Carise, Ph.D., from Phoenix House for treatment giant CRC Health Group also raised some eyebrows about the future of TCs, but Debye-Saxinger said that the simple fact was Carise’s work was done. “She did her work for us, on curriculum, on continuing to bring the TC approach into the twenty-first century,” he said. “I don’t think anybody will be replacing her — it was a consultant thing.” Carise will be working under CRC Chief Clinical Officer Philip L. Herschman, Ph.D.

Bottom Line

TCs are no longer drug-free places where everyone is confronted for nine months or more — they are part of the mainstream of treatment. But they are still fighting for coverage for their residential services under healthcare reform.