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Universal Health (UHS) Ties Up for New Psychiatric Hospital

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Universal Health Services’ (UHS - Free Report) affiliate Havenwyck Hospital received an initial approval for a state Certificate of Need (CON) Proposed Decision on Mar 29, 2021, which is required to build a new inpatient behavioral health hospital. The company forged an alliance with the regional, multi-campus, Catholic health care system Mercy Health for this joint venture.
Subject to closing approvals, the site construction will begin this year. The hospital is expected to open in spring 2023.

This new psychiatric hospital will have a room for 60 adult inpatient beds and 24 additional inpatient beds for geriatric psychiatric patients along with space for future expansion. While the review and other closing conditions are pending, Universal Health and Mercy Health are planning to build the hospital near the Mercy Health Southwest Campus in Kent County.

The new hospital is expected to meet growing demand for healthcare services. People in the area will be able to access quality behavioral health services. Both companies will finalize the deal once they get the pending approvals.

The combination of Universal Health’s behavioral healthcare team and Mercy Health’s wide network will drive better health outcomes.

This move is made at a time when people are seriously dealing with behavioral health issues. The pandemic caused financial turmoil for many families. Unemployment persists to be one of the major reasons for substance abuse, addiction, depression and more. Given the current economic situation, the need for behavioral healthcare is here to stay. The new hospital will meet the mental health issues of the local communities.

The COVID-19 pandemic made the shortage of behavioral health systems more evident. Notably, Mercy Health Saint Mary's provides behavioral health services through its inpatient unit, outpatient and ambulatory care sites, and tele-psychiatry programs.

It has five Behavioral Health Facilities located in Michigan. The company focuses on behavioral indications like eating disorders, sexual trauma, autism and disorderliness in the military through its patriot support program.

Since 2012, average licensed beds in the behavioral health centers have been growing, thereby aiding their top lines. Though the segment’s patient days were adversely impacted in light of the suspended elective and scheduled procedures since the pandemic started, the company taken measures in boosting its behavioral health portfolio through a slew of joint ventures. This segment holds immense scope for growth in the days ahead considering the dire need of addressing behavioral health issues triggered by the pandemic.

Shares of the company have gained 50.3% in a year’s time, underperforming its industry's growth of 121.9%. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.



Notably, other companies in the same space including Community Health Systems, Inc. (CYH - Free Report) , Acadia Healthcare Company Inc. (ACHC - Free Report) and HCA Healthcare Inc. (HCA - Free Report) have also rallied 334.7%, 223.2% and 124.5%, respectively, in the same time frame.

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