Industry Analysis & Industry Trends
Although the recession negatively affected industry revenue and wages, rehabilitation clinics have largely recovered, despite a slight dip in 2012 resulting from a drop in federal funding of Medicare and Medicaid, due to a rise in premiums. Moreover, the improving economic environment is forecast to boost revenue for the Drug and Alcohol Rehabilitation Clinics industry during the five years to 2019. The Patient Protection and Affordable Care Act (PPACA) of 2010 is expanding private and government coverage of industry services, thereby bolstering demand. In turn, companies will continue to enter the industry due to an increasing focus on outpatient services, which are less costly than inpatient care and more desirable among insurance providers, supporting revenue growth.... purchase to read more
Industry Report - Industry Investment Chapter
The Drug and Alcohol Rehabilitation Clinics industry has a low level of capital intensity and is labor intensive. IBISWorld estimates that for every dollar spent on wages, industry operators will spend $0.04 in capital investment. Capital investment is mainly in equipment and technology. Over the past five years, capital intensity has remained relatively constant.
Wages are estimated to account for 48.8% of total industry revenue in 2014. Meanwhile, depreciation costs, which serve as a proxy for capital investments, are estimated to total about 1.8%. The labor-intensive nature of outpatient rehab care necessitates a high dependence on skilled labor, such as licensed therapists, psychologists and psychiatrists... purchase to read more