There was an article in the NY Times this past Tuesday on WHC's Psyc. Hospital. Overall it was positive on the progress that WHC has made, but it was uncertain/doubtful as to it's profitability.
The behavorial health business has crept into the private corrections business, and when it is done on an outpatient or more moderate scale (as to the type of facility), it has pretty decent profit margins. However, I don't think running the large phyc. hospitals work well because of the very high overhead and cost of these large phyc. hospitals (i.e. most of these type of facilities were build back in the days of receiving $1000-$2000 per day for a client, and most of those days are gone).
However, the real question for WHC (if they indeed want to grow in this area) is if they can either purchase one of these facilities for pennies on the dollar, or be able to build a more cost effective facility (which is something the private corrections industry has a good reputation with in the prison side).
I did read the NY Times article, but it seemed a so general. I couldn't get a real grasp on the strategy. How would Psychiatric Hospitals in todays world of HMOS turn much of a profit?? More specifically, what qualifies WHC to get into behavioral health to achieve bottom line profitability.