Minnesota's Hazelden, California's Betty Ford Center to merge

Two household names in addiction treatment, Hazelden and the Betty Ford Center, said Tuesday they are merging to create the largest nonprofit addiction treatment organization in the nation.

The melding of the two addiction care powerhouses comes on the eve of federal health reform measures that will require insurance companies to cover substance abuse and mental health treatment.

For the first time, millions of Americans will have access to treatment, but not everyone will need to spend time in the cloistered facilities that have drawn celebrities, world leaders and average citizens to both Hazelden and the Betty Ford Center.

"As we looked at what was coming down the pike with health reform … the world of the free-standing residential centers wasn't going to cut it," said Hazelden CEO and President Mark Mishek, who will continue to lead the merged operations.

The new world will require a "full array of services, Mishek said, including inpatient and outpatient care as well as specialty services, such as Betty Ford's expertise in treating chronic pain and addiction and Hazelden's expertise in treating health care professionals and young people.

"Coming together we'll be able to reach more people," Mishek said. "We'll be bigger, we'll have more locations and we can do a lot more outreach."

The new entity, under a combined board, will be named the Hazelden Betty Ford Foundation, and will keep its headquarters in Center City, Minn. Hazelden will also rename its Women's Recovery Center in Minnesota to honor Betty Ford's commitment to promote treatment and recovery for women, officials said.

The deal is expected to be completed by the end of the year, pending regulatory review.

Mishek said a priority will be opening Betty Ford outpatient centers in Los Angeles and San Diego. He also will look at purchasing a new platform for electronic patient records to make it easier to coordinate care.

The two organizations began informal discussions in January and they quickly progressed from talking about joint programming or mutual conferences into serious merger discussions, Mishek said. The boards formally announced the talks in June.

Hazelden, founded in a rural Minnesota farmhouse in 1949, is the older and larger of the two organizations, which share a similar abstinence-based approach to treating drug and alcohol issues.

Hazelden operates facilities in five states, and recently expanded its residential and outpatient facilities in Plymouth for adolescents and young adults.

The Betty Ford Center started in 1982 in Rancho Mirage, Calif., with a vision set by the wife of former President Gerald Ford to tailor a drug and alcohol program toward the needs of women. The Betty Ford Center also operates a children's program in Denver and in the Dallas-Fort Worth area, though its focus has remained on the 160-bed hospital in a mountain valley two hours east of Los Angeles.

Overall revenue at Hazelden is about $140 million, but that includes a publishing arm and a fully-accredited graduate school of addiction studies and training programs. Its addiction-based services bring in about $110 million a year, Mishek said. That compares to about $40 million for the Betty Ford Center.

Analysts predict that the increased access to insurance and likely pressure from insurers to keep costs down will make it vital for institutions such as Hazelden and Betty Ford to coordinate care to hold down costs.

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.

Jackie Crosby • 612-673-7335