
A new report by the Senate Finance Committee concludes that children in residential treatment facilities routinely suffer harms like sexual and physical abuse, unsafe and unsanitary conditions, and lack of needed therapy. Further, it concludes that these harms are endemic to residential care itself. While the fact that some residential care facilities are substandard and cause harm to children is undisputed, the SFC’s study is poorly designed and should not be used as the basis of policy. It is based on facilities run by only four companies and cannot be used to make generalizations about residential care as a whole. Both the study design and the findings of the SFC report appear to stem from a preconceived conclusion and not on a desire to describe the actual landscape of residential care for America’s youth who need intensive behavioral health care.
On June 12, 2024, the Senate Finance Committee (SFC) released a report called Warehouses of Neglect: How Taxpayers are Funding Systemic Abuse in Youth Residential Treatment Centers. The report was based on an investigation of what it calls residential treatment facilities (RTF’s) operated by four large companies, “each owning facilities with a history of public abuse and neglect allegations and a substantial facility footprint.” It does not define RTF’s, but the term clearly refers to facilities that provide behavioral health services in a residential context to children with funding from programs under SFC jurisdiction, mainly Medicaid and foster care funds under Title IV-E of the Social Security Act. The four companies include three profit making corporations (United Health Services, Acadia Healthcare, and Vivant Behavioral Healthcare), and one nonprofit, Devereux Advanced Behavioral Health.
The report describes a pattern of poor conditions and abusive practices that the SFC staff observed by reviewing media articles and company documents, supplemented by interviews with senior leaders in the four companies and visits to several facilities not operated by these companies.1 These conditions and practices include sexual and physical abuse by staff; the inappropriate and often abusive use of restraints and seclusion; staff who are unqualified and inadequately trained staff or who routinely fail to discharge their duties, leading sometimes to tragic results; “non-homelike,” unsanitary and unsafe conditions; failure to provide the treatment that children need and that states are paying for; failure to maintain connections between children and their communities and to make adequate discharge plans; use of technology to monitor children that is more appropriate to detention facilities than therapeutic settings; and the absence of adequate oversight by state and federal authorities.
The report raises valid concerns about private businesses being involved in services to the most fragile young people. Several details stand out, all of them involving the company called Vivant and its CEO, John “Jay” Ripley. Ripley is the former CEO of Precision Tune Auto Care and and cofounder of BGR the Burger Joint. Ripley previously founded Sequel Youth and Family Services, which became known for the death of 16-year-old Cornelius Frederick while being restrained at a Michigan facility in 2020 and allegations of abuse and neglect at other Sequel facilities. In 2021, according to the report, Sequel closed half of its facilities and sold the other half, including 13 facilities that it sold to Vivant, Ripley’s new company. VIvant in turn hired many former Sequel executives and staff. In a video made by the University of Baltimore’s Merrick School of Business, Ripley explained that “you can make money in this business if you control staffing.” Ripley does not seem like the kind of person who should be running facilities dedicated to healing the most vulnerable young people.
The SFC report might have been a valuable document had it not tried to apply its findings to residential care in general. “Children suffer routine harm inside RTF’s,” the authors write. “These harms include sexual, physical, and emotional abuse, unsafe and unsanitary conditions, and inadequate provision of behavioral health treatment.” Leaving aside the ambiguity of the word “routine” (does that mean every resident or the majority of residents are harmed in such a way?), such a conclusion cannot be drawn from an investigation of treatment centers operated by four large companies. We have no idea what proportion of young people receiving publicly funded RTF care are in facilities operated by these four companies. Around the country, there are residential treatment facilities operated by many providers, including many freestanding facilities that are not part of large chains. Even within the companies reviewed, the report provides no data to document whether the problems exist only at certain facilities or throughout the chains. A facility’s functioning to a large extent reflects its leadership, and there may be well-run facilities among those operated by these companies.
Going even further, the SFC concludes that “the risk of harm to children in RTF’s is endemic to the operating model. The harms children in RTFs experienced are the direct, causal result of an operating model that incentivizes providers to optimize revenues and operating and profit margin. RTF providers offer minimal therapeutic treatment in deficient physical settings with lean staff composed of non-professionals, which maximizes per diem margins…” The report goes on to say that “[a]t its core, the RTF model typically optimizes profit over the wellbeing and safety of children.” But there is no “RTF operating model.” The understaffing and lack of professionals that are common among publicly funded residential providers more likely stem from the low reimbursement rates that that these programs receive, which in turn means that staff receive low pay as well, forcing the facilities to rely on poorly educated and trained staff.
Even more extremely, the report states that “In the best of circumstances, children at RTFs receive care from under-trained and overburdened staff, are given infrequent therapy, sometimes by non-professionals, and are exposed to unsanitary, unsafe, and non-homelike environments.” It is hard to understand how the SFC is capable of describing the best residential programs when its entire methodology consisted of seeking abuses in an extremely limited universe of residential programs.
In suggesting that residential treatment is a flawed model that should not exist, the SFC report ignores the important role of residential treatment facilities in the continuum of care for young people with mental illness. The Committee’s own invited witness, Elizabeth Manley of the University of Connecticut School of Social Work, testified about the need for these programs.
Residential treatment facilities have an important role in the provision of care for young people with complex behavioral health care needs when they have a clinical or behavioral health treatment need that cannot be met in a family and community setting due to the intensity of their treatment and supervision needs. In those instances, we need the care to be delivered in trauma-responsive environments that embrace parent and caregiver engagement throughout the treatment intervention and continually focus on best practice. These residential treatment facilities can have a significant benefit to the young person and their family.
The Child Welfare League (CWLA), in written testimony submitted to the SFC, added that residential services are “a small but important part of the full array of services” that must be available to meet children’s mental health needs.” CWLA went on to explain that there “are many providers and programs providing or striving to provide trauma-responsive, time-limited, effective residential care. They are informed by the emerging literature highlighting promising practices in residential interventions..” CWLA cited the Building Bridges Initiative, which is a national initiative working to identify and promote best practice and policy in residential interventions for youth. The initiative has produced a guide called Building Effective Short-Term Residential Interventions. According to this report, a new literature has developed in the last ten years or so which documents promising practices in residential intervention which are associated with positive benefits. These include “actively engaging youth and families, ensuring active school and community connection, and keeping residential intervention as short as possible.” The authors explain that “[c]utting-edge effective residential intervention now means providers are creatively working with youth and families in the home, in the community, and as briefly as possible – often for three months or less.” The guide was developed to help organizations make the transition to the new approach, with case histories of 12 programs that are making or have made this transition.
Ignoring this new literature, the SFC claims that “studies show that home and community-based approaches produce better treatment outcomes than placing children in RTFs, and are more cost-effective than RTF placements.” In the footnote to that sentence, the writers list only one study, which concerns only one type of facility, Psychiatric Residential Treatment Facilities, a particular model the provides the equivalent of in-patient psychiatric services outside a hospital setting to young people under 21 through an agreement with a State Medicaid agency. Moreover, that study does not conclude that community-based approaches produce better treatment programs. Instead, it concludes that “evidence is insufficient to assess which interventions are effective.” It is almost impossible to conduct a meaningful study comparing residential treatment to community-based approaches, since the children who are sent to RTF’s are generally much more troubled or impaired than the children who are not, and it would be hard to control for such differences without doing a randomized controlled trial. That’s why there are few if any studies that shed light on this issue.
It is hard to avoid the conclusion that both the study design and the findings of the SFC reflect the Committee’s desire to show that residential care is harmful to young people. The SFC’s anti-residential bias is displayed in numerous passages throughout the report. One particularly inaccurate statement claims that “In some cases….., child welfare agencies place children in state custody without diagnoses in RTFs because they have nowhere else to place them.” As evidence, the report cites a 2013 report that showed 28.8 percent of children in “congregate care” had no clinical diagnoses. But congregate care (a term used to designate any placement that is not a foster home) is a more general term than RTF’s. The earlier report included many other types of facilities including cottage-style homes (often on the site of former orphanages and often providing high-quality family-style care) that are not intended for children with serious behavioral health needs, as well as emergency shelters that some states operate to house children before they are placed in a foster home. Given the relatively high cost of RTF’s, it would be very strange if states placed children in them for lack of another option.
Much more common is the opposite scenario: agencies placing children in foster homes unprepared to care for them, resulting in placement instability, or even letting them sleep in hotels or offices, for lack of residential treatment facilities. Articles about this problem appear frequently, including a recent report from the Midwest Newsroom (a collaboration between NPR and Midwest member stations) on the insufficient capacity of residential care for girls in Missouri and Iowa. The article starts with the story of a young woman who was placed in a residential treatment program called Missouri Girls Town after a traumatic childhood, placement in foster care and a disrupted adoption by a parent who could not handle her rebellious adolescence. This young woman credits Missouri Girls Town with completely changing the trajectory of her life. Sadly, this nonprofit program, which relies on private donations to supplement what it gets from government agencies, was designed to accommodate up to 50 girls but can only take 12 because of “staffing and funding challenges.” Stories like this have been appearing from around the country for years. There is not enough residential treatment for the young people in foster care who need it. Facilities have been shutting down due to failure of state reimbursement rates to keep up with operating costs, as well as the increasing unpopularity of residential care among state officials and legislators.
Despite the major flaws in the SFC’s analysis, there is little to object to in its recommendations. It’s hard to argue against recommendations that Congress act to improve conditions in congregate care facilities, that the companies reviewed raise their standards, and that states invest in community-based services for children with behavioral health needs and improve oversight over RTF’s. The need to invest in community-based services is particularly important because it might enable some children to be helped before their problems become so severe that they need residential care. It might even prevent some placements in foster care that occur when parents can no longer care for behaviorally challenging their children at home. But the findings of the report remain dangerous even if the recommendations are benign; they can be used to support attempts to defund residential care entirely, which would be disastrous for our most vulnerable young people and their families.
The SFC report confounds a group of residential treatment facilities poorly run by four large corporations with the entire field of residential treatment for youth with serious behavioral health care needs. The report presents a distorted picture of a field that already contains excellent, life-changing programs and where passionate and dedicated leaders are already providing or working toward trauma-informed, short-term, and effective residential services for these most vulnerable young people.
- Visits to five facilities that were not operated by the four providers being investigated were used to document physical conditions in the facilities, as well as their efforts to provide education to the residents. The finding of “non-homelike,” unsanitary and unsafe conditions was based on the visited facilities rather than on the four companies that were investigated. ↩︎











