As veteran behavioral health practitioners in Hawaii, Dr. Bill Heran and Dr. John Neuhaus had for years watched in dismay as people needing help with addictive illnesses would more often than not leave the islands, heading usually to California or Arizona for private treatment. “We were struck recently by an instance in which a man who had a substantial business here went to California for treatment,” says Heran. “His stay in treatment was quite lengthy, and, partly as a result of his absence, the business ultimately went bankrupt.”

The incident served as a catalyst for both men, who shortly afterward began working on their plans to open a private treatment facility near Honolulu on the island of Oahu. Called Paradise Recovery, the new center occupies a beachfront estate that is loaded with all the amenities one could expect from a luxury treatment facility.

Dr. Heran, who will act as CEO of Paradise Recovery, and Dr. Neuhaus, who will serve as medical director, are part of a new breed of treatment entrepreneurs who are opening high-end facilities where there are no such centers, seeing opportunity while filling a needed service void.

Over the past several years, centers have been opening in regions where those seeking high-end treatment would traditionally have had to make the obligatory trek to either Malibu or Arizona to get the care they needed. Last month, in its Special Report: High-End Treatment, Treatment Magazine identified two new players who fit this mold, serial entrepreneur Perry Litchfield and a venerable behavioral health player with entrepreneurially minded executives, New England’s McLean Hospital.

“We have looked at the Hawaiian market as a possibility for high-end addiction treatment,” says Litchfield, whose Bayside Marin center, located in Marin County across the bay from San Francisco, has been extremely successful, serving about 200 clients over a period of two years at treatment rates that average about $45,000 per month. Litchfield agrees that there is likely good demand for a high-end center in Hawaii, from local sources and from on the mainland. Both Dr. Heran and Dr. Neuhaus are banking on that demand, as well as a plentiful supply of well-heeled clientele who are willing to pay the minimum rate of $60,000 a month at Paradise Recovery, which is among the highest such rates to be found anywhere in the treatment industry.

“We will be offering the highest caliber of treatment here,” says Neuhaus. While incorporating a strong element of 12-Step-based modalities, Paradise Recovery will also rely heavily on “strengthbased” programming techniques developed by Dr. Martin Seligman of the University of Pennsylvannia. There will also be a high degree of individualized therapy for each client that will be based on extensive psychological testing, according to Dr. Neuhaus.

In general, the Hawaiian treatment market tends to be dominated by non-profit players who rely mostly on government funding and, to a lesser degree, commercial payors for their revenues, according to Dr Heran. “There isn’t much of a private pay market here at all, high-end or otherwise,” he says.

With perhaps 400 residential and inpatient beds scattered across the seven island pacific archipelago, Hawaiian treatment providers have seen a strong uptick in the demand for beds over the past two years, according to Andy Anderson, CEO of non-profit Hina Mauka Recovery Center, one of the largest treatment providers in the state with 23 mostly outpatient locations on the islands of Kauai and Oahu. “Most of the treatment centers are experiencing very high census counts throughout the state and it’s very difficult to get a bed right now,” says Anderson, which he points out is quite a bit different than the environment as early as two years ago, when beds were widely available.

Behind the surge in demand is a massive increase in government spending on treatment -Anderson says the state budget on treatment, drug courts and prevention has doubled to about $36 million - combined with vastly more generous reimbursements for addiction treatment by the state’s largest managed care provider, Hawaii Biodyne.

Driving the government and private payor spending surge was a wave of publicity in 2003 about what the local media labeled the “ice epidemic” -crystal methas well as generally high levels of untreated addiction on the islands. “The publicity worked, but now we are very much bumping up against our capacity to meet demand for services,” Anderson said.

Certainly, Hawaii over the years has been very focused on promoting recovery, especially among youthful victims of the disease of addiction. Starting in the 1980s, the state has mandated that all middle schools and high schools provide outpatient addiction treatment services on site as part of an effort to nip addiction in the bud among the state’s adolescent population.

Anderson’s Hina Mauka Recovery Center is one of Hawaii’s largest providers of in-school addiction services, handling about 2,000 teen clients a year. “These programs work, they are very successful,” says Anderson.

There’s certainly a need. In a 1998 study, the Department of Health identified 17,000 youths in grades six thru 12 that needed treatment, 16 percent of all students. JW