Landmark Recovery, a prominent provider of addiction treatment services based in Franklin, Tennessee, has found itself in the midst of a significant restructuring following the sudden closure of three of its facilities. The company, which has been a key player in the addiction treatment field, recently made the difficult decision to reduce its workforce by about one-third, marking a challenging period for the organization. The layoffs come on the heels of serious financial and operational setbacks, including the closure of several facilities and the loss of critical licenses.
At the end of August, Landmark Recovery was forced to lay off approximately 300 employees, a move that impacted those working at its three Indiana-based facilities. These facilities primarily served Medicaid enrollees, and their closures were precipitated by the Indiana Division of Mental Health and Addiction’s decision to revoke the licenses for three out of the company’s four Indiana facilities. The revocation followed a tragic incident at the Mishawaka location, where three patients lost their lives. This incident led to intense scrutiny of the facility’s operations, ultimately resulting in the revocation of its license and the subsequent closure of all three affected locations.
A week after the closures, Landmark Recovery announced another round of restructuring, impacting an additional 160 roles. This second round of layoffs further reduced the company’s total workforce, bringing its headcount down by 33% to approximately 940 employees, including 80 furloughs since the shutdowns. The facility closures and layoffs are part of a broader pattern of financial instability that has affected Landmark Recovery in recent months, with the company facing significant challenges in maintaining its operations and workforce. Despite these setbacks, Landmark Recovery continues to provide addiction treatment services at its Indianapolis facility, which caters to cash-paying and commercially insured patients.
Landmark Recovery had ambitious expansion plans in the years leading up to these events. In 2022, the company was on track to expand its footprint to 16 facilities by the end of the year, with even more aggressive goals to reach 40 locations by the end of 2023. However, the unforeseen closures of its Indiana facilities and the subsequent layoffs paint a starkly different picture, suggesting that financial challenges have hit the company harder than expected. As the company restructures, it faces tough questions about its ability to continue offering quality addiction treatment services on a larger scale.
This round of layoffs follows a previous round that occurred in March, which affected around 70 employees at the company’s headquarters. These layoffs were part of a broader effort to restructure the company in the face of mounting financial difficulties. The Indiana facility closures and workforce reductions represent the culmination of what appears to be a series of financial missteps and operational issues that have severely impacted Landmark’s ability to scale as it originally intended. The company’s capacity to deliver addiction treatment services at its full potential is now uncertain.
One of the most significant blows to the company’s recovery came in September, when Landmark Recovery lost its appeal to the Indiana state government regarding the revocation of its facility licenses. On September 1, an administrative law judge ruled that Landmark had not provided sufficient evidence to justify staying the Indiana Division of Mental Health and Addiction’s decision to revoke the licenses. This ruling effectively sealed the fate of the three facilities, making it impossible for the company to reopen them in the immediate future. While Landmark Recovery still operates its Landmark Recovery of Indianapolis facility, which caters to cash-paying and commercially insured patients, the loss of the Indiana facilities has raised significant concerns about the company’s future prospects in the region and its ability to expand its addiction treatment services.
It appears that Landmark Recovery was already facing financial difficulties before the closures. According to an email written by CEO Matt Boyle, the company struggled with cash flow issues in 2022 after the opening of its Mishawaka, Indiana, facility. This facility, which was part of the company’s ambitious expansion plan, ultimately contributed to the financial strain that led to the company’s current state. Emails obtained by BHB suggest that the company is also facing delays in severance payments to employees who were laid off as part of the restructuring process. These delays have been attributed to administrative issues, including a payroll mix-up that led to the inclusion of former employees who had voluntarily left the company in the severance payment program.
Landmark Recovery has promised to honor its severance pay commitments, despite the delays. General Counsel Chris Kang informed employees that the delay could extend up to 60 days, but emphasized that the company would do everything in its power to fulfill its promises. COO A.J. Henry also sent out messages to furloughed employees, reassuring them that they were still considered employees of the company and would remain on furlough until September 30. This confusion has added to the strain on employees, who have been left uncertain about their future with the company. Regardless of the internal struggles, Landmark Recovery remains dedicated to providing addiction treatment services to those in need and addressing these issues as quickly as possible.
Despite the financial challenges, Landmark Recovery is making efforts to stabilize its operations and navigate through the difficult period. CEO Matt Boyle attributed the delay in severance payments to an administrative mix-up while reviewing payroll records. He also mentioned that the company had mistakenly included employees who had voluntarily left the company in the severance payment program, which went against its policy. Boyle has assured the remaining employees that the company is committed to resolving the issue and will investigate the situation further. As the company continues to deal with these challenges, it remains committed to its core mission: providing addiction treatment services to help individuals achieve recovery and regain control over their lives.
As Landmark Recovery looks to the future, it remains to be seen how the company will recover from these setbacks. While the company continues to operate its Indianapolis facility, the closures of the Indiana locations and the financial difficulties experienced by Landmark Recovery raise questions about the company’s ability to regain its previous momentum. Landmark Recovery will also have the opportunity to present a full evidentiary hearing before the administrative law office in an attempt to regain its facility licenses, which could provide a glimmer of hope for the company’s recovery. The outcome of these efforts will play a significant role in determining whether Landmark Recovery can continue providing addiction treatment services at a larger scale across the nation.
For now, Landmark Recovery is focused on managing its workforce reductions, addressing its financial difficulties, and attempting to regain the trust of both its employees and patients. As the company works through these challenges, it will need to reevaluate its expansion strategy and find ways to stabilize its operations in order to move forward. The road to recovery will likely be long, but Landmark Recovery is determined to overcome the difficulties it currently faces and fulfill its commitment to providing addiction treatment services for those seeking help and healing.
