American Addiction Centers’ (AAC) parent company has now completed the acquisition of not-for-profit Sunrise House Foundation—a deal that was first announced in March. The total purchase price was $6.6 million in cash, and $5 million in renovations are expected.
“The fundamental issue in a for-profit acquisition of a nonprofit service provider is whether or not patient-centric quality of care will be subordinated to priorities related to cost containment and shareholder equity,” says Herb Paine of Paine Consulting Services, which focuses on not-for-profit organizations. “There is good reason to be concerned about profitability trumping quality.”
Sunrise House adds 92 rehab beds, 18 detox beds, 30 halfway house beds and two outpatient programs to the AAC portfolio. This is the first entry for AAC into New Jersey, and the deal fits with its strategy of increasing in-network offerings.
Sunrise CEO Philip Horowitz, PhD, will continue to oversee the facility operations.