Rod Laughlin, who made a reputation building psychiatric and long-term acute-care hospital companies, has returned to behavioral health with big plans and a big acquisition.
His Perimeter Healthcare announced Thursday the purchase of WoodRidge Behavioral Care, a provider operating five psychiatric hospitals and three acute hospital programs serving adolescent and geriatric patients in Arkansas, Missouri and Tennessee. Terms were not disclosed.
Laughlin was a founder of Acadia Healthcare in 2005. He also built Regency Hospital Co. into a 23-hospital long-term acute-care chain before selling it in 2010 to Select Medical Holdings. And he did the same at Transitional Hospitals Corp., building it into a 19-hospital chain between 1992 and 1997 before its sale to Kindred Healthcare.
Laughlin said the WoodRidge acquisition is just the beginning for Perimeter, which is backed financially by Charlotte, N.C.-based equity group Ridgemont Equity Partners.
In an interview Thursday, Laughlin said WoodRidge is the foundation for a behavioral health company that Laughlin expects to grow by five to nine psychiatric hospitals per year. He declined to provide WoodRidge's annual revenue.
Laughlin said many areas of the country have a shortage of psychiatric beds as the stigma of mental health issues begins to fade in the public eye. Mental health treatment is a $13.4 billion annual industry, he said.
Laughlin, a 35-year industry veteran, said WoodRidge has strong clinical programs, which attracted Perimeter to the company. Perimeter is owned by management and Ridgemont. WoodRidge has a total of 320 beds.
Laughlin said he operates on a philosophy that when specialty hospitals get quality right, patient referrals and financial results follow. “It's more than just numbers,' he said.
WoodRidge focuses predominantly on behavioral health for adolescents and seniors. Laughlin said Perimeter will also use acquisitions to address adult care.
He said Perimeter has two additional hospital acquisitions in the pipeline, projects that could be completed before year-end.
He said other negotiations could result in two or three additional acquisitions by the first quarter.
Acadia Healthcare today is among the nation's largest, investor-owned systems of psychiatric hospitals and behavioral health services.
Laughlin said he helped to start Acadia as a sister company of Regency, which was backed at the time by Waud Capital Partners.
Laughlin left the Acadia CEO post in 2007 because Medicare reimbursement cuts at long-term acute care hospitals demanded that he put his full attention on Regency.
After Regency was sold, Laughlin said he dabbled in home health care, but found running hospitals more exciting.