Chestnut Lodge Hospital in Rockville, Md., was sold to a nonprofit community mental health agency for $4 million, according to Wayne Fenton, M.D., medical director and director of research at Chestnut Lodge.

Chestnut Lodge, recently ranked as one of America's "best hospitals" for psychiatry by a U.S. News and World Report survey, was sold to CPC Health--formerly known as Community Psychiatric Clinic--a private nonprofit agency providing outpatient treatment for mental illness at sites throughout Montgomery County, Md.

Chestnut Lodge was a pioneer in the intensive treatment of serious mental illness.

For three generations it was owned and operated by the founding Bullard family. When Dexter Bullard, M.D., retired in 1994 with no successor remaining in the family, it marked the end of a dynasty.

"[The Bullards] always felt that if they were going to own it, they were going to run it," said CPC Health Executive Director Steven Goldstein, Ph.D., in an interview with Psychiatric News.

"Their values were such" that they didn't want to own it if they weren't going to have a say in how it was run, Goldstein said.

The Bullards operated Chestnut Lodge strictly and according to the principles of long-term psychodynamic psychotherapy for which the hospital had earned a reputation.

But Fenton and Goldstein both said that anyone inclined to see the sale of Chestnut Lodge as the sudden end of an era hasn't been paying attention to the hospital recently.

Treatment at Chestnut Lodge "has been changing and will continue to change," Goldstein said. "Reputations tend to respond more slowly than reality. . . . The reality is that the hospital is not the hold-out institution it is perceived as. Maybe it was 10 years ago, but not anymore."

Treatment of patients at Chestnut Lodge began to incorporate a range of services, including the use of psychotherapeutic medication, under the administration of Dexter Bullard, Goldstein said.

"Long-term treatment has not been abandoned but will continue using a broader continuum [of services] with room in the orientation for different points of view," said Goldstein.

Fenton concurred. "It's fair to say that for the last 15 years, the lodge has been a fully integrated facility. . .and a strong proponent of therapy that integrates three components--psychotherapy, rehabilitation, and pharmacology."

Fenton added that Chestnut Lodge was the first institution in the mid-Atlantic region to use Clozaril.

The acquisition by CPC Health will "expand our ability to pursue our mission," Fenton said. "For some time our mission has been to care for people with serious mental illness. . . . Essentially we are merging with an organization that is the major provider of outpatient care for the same population. So this has created probably the largest provider [of care to the seriously mentally ill] in the Washington, D.C., area. We now have in this merger all the elements of a community mental health center."

Goldstein sees the $18 million, 350-employee CPC Health as an alternative to the giant mergers and increasing dominance of national hospital chains. "There is room for our kind of dedication to our mission," he said.

CPC Health's services range from inpatient psychiatric hospitalization to community prevention programs. Outreach services include mental health education and prevention services for the general population and programs targeting underserved populations.

Fenton said CPC Health will maintain current staff levels at Chestnut Lodge.

(Psychiatric News, September 20, 1996)