OBOT Market Growth and Consolidation
The office-based opioid treatment (OBOT) sector continues experiencing significant consolidation and expansion, defying broader market slowdown trends affecting the addiction treatment industry. These developments signal strong opportunities for providers willing to invest in strategic growth.
Understanding the OBOT Model
OBOT models revolutionized addiction treatment by introducing medication-assisted treatment (MAT) using buprenorphine, methadone, and naltrexone into traditional medical settings. This approach reduces stigma while improving accessibility for patients struggling with substance use disorders (SUDs).
Industry leaders view this moment as particularly opportune for scaling innovative care delivery models. The sector remains poised for continued expansion despite economic headwinds affecting behavioral health services.
“I actually think we are in a growth stage and a consolidation stage,” Steve Priest, co-founder and CEO at Spero Health, said during INVEST 2025 in October. “But in reality, I’m pretty bullish about the next chapter and where we’re heading, because I do think there are huge opportunities in the space.”
Massive Underserved Population
The market opportunity stems from a remarkably underserved patient population requiring evidence-based addiction treatment. Spero Health, a large outpatient addiction treatment provider headquartered in Brentwood, Tennessee, operates across six states and continues expanding its footprint.
Priest emphasized that providers collectively deliver care making meaningful differences in patients’ lives while building sustainable business models. The unique consolidation opportunity enables platforms to scale operations while improving care quality and geographic reach across the United States.
Success Factors for OBOT Consolidation
Balancing Operations, Culture, and Finance
Successful OBOT clinic consolidators prioritize multiple integration dimensions simultaneously. According to Krysta Cass, president of SaVida Health, which operates dozens of OBOT clinics nationwide, leading consolidators excel through comprehensive implementation strategies.
“The successful consolidators are doing so well because they’re prioritizing both operational and cultural implementation, as well as the financial synergies across the companies,” Cass explained.
This holistic approach ensures merged entities maintain care quality while achieving operational efficiencies and financial performance targets essential for sustainable growth.
Reimbursement and Workforce Challenges
Industry Inflection Point
Despite recent growth momentum, OBOT programs face significant hurdles including reimbursement complexities, payer pressures, and workforce shortages. These challenges intensify as the industry reaches an inflection point characterized by rising medical costs and increasing payroll expenses.
Shifting Healthcare Dollar Allocation
Recent years revealed concerning trends in healthcare spending patterns. Payroll spend increased while primary care visits declined, signaling a fundamental shift in dollar allocation across healthcare services.
“The question is, can payers – thoughtful ones – understand that there’s an investment there that should pay off in a lower total cost?” Priest said. “Are we going to ever benefit from that in terms of being attributable to the work we do? I highly doubt it, to be quite honest.”
Cost-Effective Care Models
OBOT models typically provide lower-cost services helping bend the healthcare cost curve for expensive patient populations. However, a persistent disconnect exists between OBOT operators and payers regarding reimbursement adequacy for sustainable operations.
Priest acknowledged the brutal reality that substance use disorder patients represent significant costs to payers, making sustainable reimbursement models critical for maintaining access points.
Advocacy and Industry Alliance Formation
NACATS Launch
The disconnect between OBOT operators and payers catalyzed the recent launch of the National Alliance for Comprehensive Addiction Treatment Solutions (NACATS), a 501(c)(4) organization focused on advocacy.
“It’s designed around advocacy for a stable reimbursement model in high-quality care for our patient population,” Priest explained.
Evolving Patient Population
Despite discussions about declining overdose death rates, the fundamental access problem persists. Patient populations evolved from primarily opioid use disorders to poly-substance use patterns, requiring more comprehensive treatment approaches.
NACATS focuses advocacy efforts in Washington, DC, working with CMS on sustainable bundled reimbursement models, making incremental progress toward systemic improvements.
Demonstrating Value to Healthcare Payers
Speaking the Payer Language
Driving meaningful conversations with payers requires speaking their language and demonstrating measurable value. Cass emphasized the importance of integrated care models showing concrete outcomes.
“I think our long-term value is created by closing the loop between medical care, counseling services and support services, and then being able to demonstrate the value of that integrated, coordinated care model through patient outcomes,” Cass said.
Measurable Impact Metrics
Successful OBOT operators demonstrate value by proving they improve patient outcomes, reduce emergency room readmissions, and deliver cost savings benefiting both patients and healthcare systems. These data-driven approaches become increasingly critical for payer negotiations.
Medicaid Cuts and Patient Access
Immediate Census Impact
Anticipated Medicaid cuts significantly impact patient populations with substance use disorders. Doug Weiss, CEO of Porch Light Health, observed immediate effects following Medicaid cut announcements.
“We saw early on, as soon as Medicaid cuts were announced, our census started to flatten out,” Weiss said during INVEST. “What we found is our patients are afraid that they’re going to get a bill so they stop coming to treatment.”
On-Demand MAT Services
Colorado-based Porch Light Health launched innovative services connecting discharge planners with patients leaving hospital treatment, facilitating quick transitions from emergency departments into substance use disorder care. This Medicaid payer partnership approach addresses eligibility concerns proactively.
“Our approach is to use different tools to help the patients, just as we did during the public health emergency,” Weiss explained, emphasizing the importance of reducing financial pressure enabling continued treatment engagement.
Building Strategic Payer Relationships
Scale Advantages
Building strong payer relationships while prioritizing patient-centered measures proves challenging, particularly for smaller organizations. Scale provides significant advantages in developing and maintaining these critical partnerships.
“I do think it’s hard if you’re a small organization in a single state,” Priest said. “It is really hard to build payer relations because you have to do it over time.”
Personal Relationship Investment
Payer relationships require sustained personal investment. Organizations often maintain relationships by following key individuals as they move between managed care organizations, highlighting the personal nature of these partnerships.
Smaller organizations face particular challenges navigating payer relations, which Priest described as “a black hole” without sufficient scale and resources.
Scale Advantages in OBOT Operations
Understanding that multiple organizational team members engage with payers proves equally important alongside scale considerations. Organizations must recognize that payer engagement extends beyond dedicated business development roles.
Community Engagement and Relationship Building
Beyond Transactional Interactions
“You can’t just drop a box of donuts off at the payer and expect them to call you back,” Cass said. “You have to nurture that relationship and share data in a very transparent way.”
Strategic Community Presence
SaVida operates 51 clinics across seven states, deploying growth and outreach personnel to community events typically attended by state payers. This consistent community presence strategy builds strong relationships over time.
“By doing that, we’ve built very strong inroads,” Cass said. “It took a long time to build, but it first starts with showing up. Show up, support your community and build inroads. Work with your company, the payer, and the community to demonstrate effectiveness and then continue to nurture that relationship.”
This comprehensive approach to relationship building, combined with transparent data sharing and measurable outcomes, positions OBOT organizations for sustained growth despite ongoing industry challenges.
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