After Five Decades, Austin Recovery to Close

Nonprofit succumbs to financial challenges made worse by COVID

Outpatient Rock Garden at Austin Recovery's Edith Royal Campus (Image via Facebook)

Austin Recovery will stop serving adult clients on May 15, after five decades as a cornerstone of the Central Texas recovery community, citing financial struggles made worse by COVID-19.

The nonprofit, which helps people with substance use disorders achieve sobriety through residential inpatient and intensive outpatient treatment programs, stopped accepting new adult clients on Friday, April 17. Efforts will be made to transfer clients currently enrolled in an Austin Recovery program to one at another provider.

Both the Hicks Family Ranch, which has offered residential treatment at affordable rates to people in Central Texas since 1971 (including a 90-day program for pregnant women in their third trimester or mothers with one child under the age of five), and the Edith Royal and Community First! Village outpatient programs will close down. As of April 20, AR had 46 clients in its residential program and 96 in its outpatient programs.

The news has been devastating to Austin’s recovery community. “I can’t even begin to tell you how hard it is to do this,” Austin Recovery Network Board Chair Lynn Sherman told us, with clear emotion rising in his voice. “On the one hand, there is no other option and we have to do it, but we know how much people are suffering out there. It is so hard to hold both of those ideas in our heads at once.”

Since beginning operations in 1967, AR has existed through many evolutions in care for people battling addiction, as well as how those services are funded. For each of the last 10 years, it has faced a budget deficit of about $1.5 million – a hole that board members and supporters have hustled to try to close, unsuccessfully, every year.

Funding from local governments has been critical to AR’s model, allowing it to be one of few treatment facilities in Austin available to low-income clients, but that money is only accessible for those actively receiving treatment. Sherman said ARN asked for some of that funding upfront, to help keep the nonprofit afloat during the pandemic, but an agreement could not be worked out. To avoid a situation in which AR could not make payroll during the pandemic, the board decided to close up shop.

In February 2020, AR joined a group of nonprofits to form the larger Austin Recovery Network and find a wider funding base; but Sherman said it wasn’t enough to overcome the changes in how behavioral and mental health services are billed by insurance companies, and to federal law mandating that those services be covered by insurance in the first place.

“Our payer mix changed practically overnight,” Sherman told us. “We had good paying clients through insurance or self-pay that helped pay for some of the overhead to fund the operation, but that has since changed. We tried really hard to rectify all of that to make it through the pandemic, but were unable to. We were heading this way for a while.”

The shutting down of adult services also means the 94 employees (21 clinical and 73 in facilities management) who run the AR programs are expected to lose their jobs. This, too, has weighed heavily on Sherman. “It hurts and shames me to no end that we as a community cannot find a way to support these services in a way that is sustainable for people who will die without them. We shouldn’t have to scramble for nickels and dimes to do this work.”

Dr. Carlos Tirado, Chief Medical Officer at CARMAHealth and ARN board member, expects the loss of AR services to be profound as the community tries to help people facing addiction. The nonprofit was more of a social services agency than a substance abuse treatment center, providing a range of critical mental and behavioral health assistance to clients. “We’re going to see what happens when a linchpin organization in [a community’s] public mental health and substance abuse treatment system is suddenly gone,” Tirado told us.

“We can’t hope our financial situation away. We need help from the community.” – Austin Recovery Network Board Chair Lynn Sherman

But AR will not completely disappear. The Alumni Association, which provides a space for people in long-term recovery who got treatment in an AR program to stay connected, will continue. Youth services provided by ARN through University High School – an alternative school for high school aged students that offers substance abuse treatment – and the Keystone Alternative Peer Group, which uses a peer-led 12-Step model to help young people struggling with addiction, will continue, although those services have become entirely virtual in response to the spread of COVID-19.

ARN co-CEO Julie McElrath told us the transition to virtual treatment has been mostly successful for youth clients, but the inability to connect more personally with peers is being felt. The structure offered by University High School, which is made available through a partnership with UT Charter School System, has been helpful for students, but the isolation required to contain the spread of the coronavirus is taking its toll. “We really anticipate the strain on the mental health of young people during the COVID period will require even more resources to help them after the pandemic,” McElrath told us.

McElrath also emphasized the “ethical” approach ARN was taking to discharging clients; if someone in the middle of treatment is not ready to transition to a different program, or go on without service entirely, it’s possible that AR may extend its closing date to accommodate those needs. And Sherman is hopeful that AR’s adult services may return, in some capacity, in the future if additional funding can be secured. A meeting was held on Monday, April 20, among Travis County’s mental health stakeholders, including Integral Care, to discuss AR’s closure; any funding from the city or county is highly uncertain at this point given the economic pressures that are being exacerbated by the pandemic.

But Sherman said he is ready to keep working toward a solution that enables AR to continue providing critically needed behavioral health services to people who may not have the means to pay for those services at other clinics. “We can’t hope our financial situation away,” Sherman said. “We need help from the community. It will take months to figure this out, but we’re prepared to get to the table to find a stable financing model.”


For more information on recovery support resources currently available in the Austin area, visit www.austinrecoverynetwork.org.

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