Rosecrance has announced a merger with another Illinois provider, Community Elements, effective July 1. The combined organization’s behavioral health services for adults and children will be delivered under the Rosecrance brand.
Rosecrance President and CEO Philip Eaton tells Behavioral Healthcare in an email that challenging economic times have created market changes for the provider community.
Illinois is still tangled in a politically charged budget impasse and is in danger of entering its second year without a state budget. Organizations facing tough times often seek partnerships to gain economies of scale and grow from stand-alone providers to multidisciplinary networks.
“This is the new model for success in behavioral health,” Eaton says. “Nonprofits that want to thrive and expand in a challenging economy will do as we have done by seeking out strong partners with compatible missions and values.”
Rosecrance has a blended revenue stream that combines public and private funding, philanthropic support and commercial insurance reimbursement.
In the works since early discussions began in December 2015, the merger is expected to lead to an expansion of substance abuse treatment services and create an integrated behavioral health system of care in the Champaign/Urbana area. While Rosecrance and Community Elements service areas do not overlap geographically for mental health services, Rosecrance frequently serves people from central Illinois who need detoxification and inpatient treatment for substance abuse.
“This merger will allow us to find operational efficiencies and develop new behavioral health services and programs to better meet community needs,” Eaton says. “In challenging economic times, efficient multiservice organizations that focus on core competencies—in our case, deep expertise in treating mental health and substance abuse disorders—will survive and thrive, while small, narrowly focused ones will struggle.”
According to the company, the merger has the support of state officials, including Diana Knaebe, director of the Division of Mental Health for the Illinois Department of Human Services, who said in a statement that the state supports the move toward integrated behavioral health and more efficient use of state resources.
Community Elements CEO Sheila Ferguson will become executive director of Rosecrance operations in Champaign/Urbana.