Massachusetts system ends venture with US HealthVest after Seattle Times investigation

A health system in Massachusetts ended plans to operate a new psychiatric hospital with US HealthVest, a company specializing in mental-health care whose expansion in Washington state has drawn regulatory scrutiny for repeated violations.

Baystate Health, based in Springfield, Massachusetts, first signaled in late August it was reviewing its relationship with US HealthVest, two days after the company was the subject of a Seattle Times investigation. On Wednesday, Baystate, told employees in a memo that it and US HealthVest “have mutually agreed not to move forward” with plans to jointly run a psychiatric hospital in Western Massachusetts.

A Baystate spokeswoman declined to elaborate on the health system’s decision. Richard Kresch, US HealthVest’s chief executive, didn’t respond to a request for comment.

US HealthVest has been at the vanguard of a major expansion of mental-health care in Washington state by private companies. The for-profit, New York-based firm proposed three psychiatric hospitals and ultimately won approval to build two: Smokey Point Behavioral in Marysville and South Sound Behavioral in Lacey, adding more than 200 inpatient beds.

Many officials, including Gov. Jay Inslee, initially celebrated US HealthVest’s expansion as a boon for patients in a state chronically short of inpatient mental-health treatment — a need that has only intensified Inslee’s goal of transferring patients out of problem-plagued Western State Hospital. An investigation by The Times, however, found the company has repeatedly fallen short of regulatory requirements and put patients at risk in Washington and other states.

Government inspectors found violations at Smokey Point on 12 separate visits over 15 months, citing failures to adequately staff the hospital and care for patients, records show. In April, the Washington state Department of Health denied US HealthVest’s proposal to build a third psychiatric hospital in Bellingham, partly because of its record at Smokey Point.

In June, the regulator agreed not to take action against Smokey Point’s license in exchange for the company hiring a state-approved consultant, analyzing its failures and undergoing heightened monitoring for a year. On Wednesday, a Department of Health spokeswoman confirmed the regulator had approved a consultant and was awaiting Smokey Point’s “gap analysis.”

US HealthVest has said that “all of our hospitals have been fully compliant with all state and federal regulations.”

The Times investigation also found that patients and hospital employees suffer harm far more often than is reported to regulators, and that private psychiatric hospitals regularly refuse to release patients who checked in voluntarily until forced to by mental-health officials.

In response to reporting by The Times, Inslee called on the Department of Health to strengthen enforcement of private psychiatric hospitals in September.

“I am deeply troubled at the prospect of corporations exploiting gaps in our oversight systems to profit from vulnerable Washingtonians and hard-working hospital staff,” Inslee wrote in a letter to Department of Health Secretary John Wiesman.

Wiesman, commenting on the department’s approach to enforcement, replied to the governor that “recent experiences have illustrated that this approach could be strengthened.”

The regulator is exploring a range of reforms, including seeking the power to immediately stop a “troubled” hospital from admitting patients; the ability to issue fines; and requiring psychiatric hospitals to report a broader range of safety incidents, including all deaths.

In addition, the Department of Health plans to post inspection reports online of private psychiatric hospitals by the end of the year. They now are only available by filing a public-records request, or on The Times’ website.

In Massachusetts, Baystate has proposed closing some psychiatric units in its hospitals and consolidating this care in a new, dedicated psychiatric hospital. The nonprofit said Wednesday it remained committed to this plan and would seek a new partner instead of US HealthVest.

The Massachusetts Nurses Association, a union that has been critical of Baystate’s plans, said Wednesday it was “glad that Baystate has heard the concerns of the community and ended its partnership with US HealthVest.” The union continued to advocate for keeping local psychiatric units open.