Retreat Behavioral Health, a multi-state addiction treatment provider, has abruptly closed its doors following a series of unfortunate events, including the deaths of two of its top executives and ongoing financial issues. The company has been grappling with financial instability for over a year, leaving its employees, patients, and the local communities in a state of turmoil and uncertainty.
Established in 2011, Retreat Behavioral Health had residential and outpatient facilities in New Haven, Connecticut, Palm Beach, Florida, and Lancaster, Pennsylvania. The company had recently been acquired by private equity firm Stonehenge Capital, although the specifics of the deal remain undisclosed.
Company officials acknowledged the financial difficulties that had been building over time. The company faced several challenges, including delayed and unpaid salaries for its workforce of 750, disconnection from contractors and service providers, and legal disputes relating to nonpayment and loan defaults.
“The company’s revenues had dipped, and the executive team had been aware of the dire situation for at least a year,” revealed Alexander Hoinsky, the company’s chief financial officer.
The situation escalated when Peter Schorr, the founder and CEO of the company, died by suicide on June 21. This was closely followed by the self-inflicted death of the company’s Chief Administrative Officer, Scott Korogodsky, on June 26. “The answers about the financials you are looking for probably went to the grave with Peter and Scott,” one employee told reporters.
Following these tragic events, Retreat Behavioral Health started closing down its facilities nationwide. The abrupt closure of the 80-bed residential treatment center and outpatient clinic in New Haven, which provided employment to 160 people, resulted in job losses and unpaid wages.
“There was no direction from our home office in Florida, which also is closed,” commented Jackie James, the company’s former local director of human resources.
The closures have severely impacted the communities that relied on Retreat Behavioral Health for mental health and addiction treatment services. Patients are now left without access to crucial treatment services.
A mother recounted how her son’s life was saved due to Peter Schorr’s support. Schorr gave her son hope, purpose, and even employment after he maintained a year of sobriety, a condition for being hired.
The sudden closure has left many questions unanswered. The U.S. Department of Labor’s Wage and Hour Division is investigating the company’s handling of employee paychecks and benefits. Meanwhile, the Connecticut Department of Public Health is working on transferring patients from the closed facilities to other treatment centers or homes.
