MHM Services, Inc. is a privately held mental health services provider in Tysons Corner, VA. The company's principal customers are state and local governments.
MHM employs over 2,000 clinical, management, and support staff nationwide. MHM serves approximately 250,000 inmates in 14 different states and in over 250 facilities.
Contents |
MHM offers a wide range of staffing, management, and clinical services across a variety of fields. MHM emphasizes continuous quality improvement – and as a result, MHM is often able to cut costs when finding more efficient ways of providing services.
MHM is the only national company providing mental health services to the corrections market. Most of its competitors are local groups of psychiatrists or psychologists who enter into contracts with individual prisons. These small operations generally do not have sufficient resources to make statewide contracts with Departments of Corrections.
MHM biggest national competition comes from the physical health providers such as Correctional Medical Services and Prison Health Services, which do mental health services along with their physical health programs [1].
MHM's size enables it to hire lobbying firms to represent its interests. These interests are frequently opposed by state employees' unions whose members' jobs would be threatened by privatization.
MHM was originally founded as Mental Health Management in 1981. According to a Wall Street Transcript interview with MHM CEO Michael S. Pinkert, the company started out developing mental health units in general hospital settings and quickly grew to become the country’s largest provider of inpatient psychiatric care in general hospitals. It then grew by adding freestanding psychiatric hospitals. In 1986, the company was sold to Pennsauken, N.J. Mediq, Inc.
In 1993, the company was spun off by Mediq and became a publicly traded company. MHM sold off all of its inpatient operations, including its freestanding hospitals, in order to focus solely on providing mental health services in correctional institutions [2]. In 1996, MHM bought Liberty Bay Colony Health Services Inc., a Boston, Mass.-based behavioral management services company specializing in the treatment of older adults. In an interview with Washington Business Journal, Pinkert said he planned to use the approximately $10 million in cash from the sale of MHM's hospitals to buy more businesses.
Meanwhile, Mediq continued to hold an $11 million note against MHM. In 1997, MHM sought to have the note cancelled, claiming Mediq breached its obligations to MHM by forcing MHM officials to sign a note that "unjustly enriches Mediq at MHM's expense"[3]. The suit also asked the court to require Mediq to pay back $4.5 million MHM had already paid. Pinkert called the note "a tremendous cash drain that we could have put to more productive uses."
A New Jersey Superior Court judge ruled against MHM, putting the company in serious financial trouble. Mediq told reporters that it would pursue collections; meanwhile, the American Stock Exchange threatened to delist MHM. According to a 1998 MHM press release, the company's independent auditors cited going concern problems in their report. A 1998 Georgia Department of Corrections audit noted the resolution of the matter with this statement:
This move helped assuage the nerves of MHM's customers, and the company subsequently signed several new contracts. By 2000, its profits were improving markedly, according to MHM press releases. The company went private soon thereafter.
MHM's headquarters are located in Northern Virginia on Spring Hill Road, Vienna, VA since 2004. Each contract is managed through a network of state and regional offices located throughout the United States. Each MHM contract is overseen by a team of program managers and clinical directors dedicated to meeting the unique challenges of the client agencies they serve. The firm has regional offices in: