Residential Intellectual & Developmental Disability, Mental Health, and Substance Abuse Facilities (NAICS 6232)

A Histometrics industry-group primer for public- and private-market investors.

What this level is. NAICS (North American Industry Classification System, the U.S. government's industry taxonomy) code 6232 is a four-digit industry group that bundles the two kinds of round-the-clock residential care that are neither hospitals nor nursing homes: homes for people with intellectual and developmental disabilities, and residences for mental-health and addiction treatment. It has two children — 62321 and 62322 — and its distinctive value is the contrast between them: one is nearly twice the size of the other, they are paid by different people, and they consolidate at different speeds. This page leads with that comparison, then covers the group as a whole. For leaf-level detail, follow the child links.

1. Overview

NAICS 6232 covers facilities where vulnerable people live around the clock while being cared for — as distinct from a hospital (where medical treatment is the primary service) or a skilled-nursing home (elder/medical care). It splits into two very different businesses:

• 62321 — Residential intellectual and developmental disability (IDD) facilities: group homes and larger Intermediate Care Facilities (ICF/IID) housing adults and children with autism, Down syndrome, cerebral palsy, and similar lifelong conditions. Care is a permanent living arrangement, funded almost entirely by Medicaid.[1][5]
• 62322 — Residential mental-health and substance-abuse facilities: addiction "rehab," psychiatric residential treatment centers (RTCs) for adults and teens, halfway/sober-living houses, and eating-disorder residences. Care is usually an episode of treatment, funded by a mix of commercial insurance, Medicaid, and self-pay.[14][15]

Both are bed-based, labor-intensive, government-shaped human-services sectors with structurally rising demand, chronic staffing shortages, and thin margins. Both are dominated by nonprofits, private-equity-backed platforms, and government agencies — not public companies — so listed exposure is thin and indirect in both.[6][20] What differs is scale, payer mix, and how the economics behave; that contrast is the point of this page.

2. What's inside — the two children and how they differ

The group's two children are similar in shape (beds × occupancy × rate, labor-heavy, Medicaid-touched) but differ sharply in scale and payer. IDD is the larger, steadier, more single-payer half; behavioral care is the smaller, higher-priced, more commercially exposed half.

Read the contrast this way: IDD supplies ~64% of the group's revenue from ~81% of its buildings and ~71% of its workers — many tiny, low-revenue homes leaning heavily on labor. Behavioral care extracts ~36% of revenue from just ~19% of the sites (≈2.3× the revenue per site and ~40% more revenue per employee) — fewer, larger, higher-acuity centers that can bill commercial insurers. CR4 is the share of industry revenue held by the four largest firms; HHI (Herfindahl-Hirschman Index, 0–10,000) is a standard concentration gauge where anything under 1,500 is "unconcentrated." By both measures the whole group is about as fragmented as a U.S. industry gets. Full leaf detail: 62321 primer and 62322 primer.

3. Size (this level's rollup figures)

These are our ingested ground-truth federal statistics for NAICS 6232. They are genuine group-level aggregates, not a re-sum — establishments, employment, and payroll add up exactly from the two children, and receipts sum to the dollar.

Two reading notes. First, the firm count is not additive. The children list 7,336 (IDD) + 4,504 (behavioral) = 11,840 firms, but the group shows 11,654 — because roughly 186 firms operate in both children and the Economic Census counts each such company once at the group level.[2] Establishments, employment, and receipts, by contrast, do add up. Second, mind the vintage mismatch: receipts and concentration are 2022 (Economic Census), while payroll and employment are 2023 (County Business Patterns, CBP), so the two blocks are not perfectly comparable.

Undercount caveat (important here). The $59.2 billion receipts figure is an employer-business floor, not a full measure of care activity. CBP and the Economic Census cover employer businesses (including nonprofits) but generally exclude government-run establishments — so state developmental centers, county group homes, and government-owned psychiatric/SUD residences (government owns roughly one in ten addiction residences and nearly one in five mental-health ones) are largely absent.[6][14] They also miss a long tail of tiny nonemployer arrangements — family/host homes, adult foster care, small faith-based sober-living houses — with no paid staff. And most disability and behavioral services are non-residential and sit in other NAICS codes entirely. For scale on the IDD side alone, Medicaid provides long-term services to roughly 729,000 people with IDD at about $50,000/year for a working-age adult, implying public IDD spending far above this one residential line;[5] on the behavioral side, broader third-party estimates that fold in more government and small-operator activity put the wider "mental-health and substance-abuse centers" market nearer $30 billion versus the ~$21 billion federal residential figure.[27] Treat these numbers as a reliable baseline, not a ceiling.

4. Investable universe (where value concentrates)

The blunt fact spanning both children: there is no clean U.S.-listed pure-play in either residential IDD or residential behavioral care. Value concentrates in private hands, and the two halves route through different private and public channels.

• IDD (62321): The last large near-pure public play left in 2026, when BrightSpring Health Services (Nasdaq: BTSG) sold its ResCare Community Living division to Sevita for $835 million.[8][9] Remaining listed exposure is indirect via the Medicaid managed-care payers — Centene (NYSE: CNC), Molina (NYSE: MOH), Elevance (NYSE: ELV) — and adjacent personal-care operator Addus HomeCare (Nasdaq: ADUS).[28] The real ownership is private: Sevita (Centerbridge Partners and The Vistria Group; the largest national provider), Dungarvin, PE-backed RHA Health Services, and large regional nonprofits (Bancroft, Mosaic, chapters of The Arc/Easterseals).[6][13]
• Behavioral (62322): The closest listed names skew toward hospitals and outpatient, not this residential code — Acadia Healthcare (Nasdaq: ACHC), the largest pure-play behavioral operator (RTCs were only ~11% of its 2024 revenue), and Universal Health Services (NYSE: UHS), where behavioral is a division inside a hospital company. Universal Health Realty Income Trust (NYSE: UHT) is a small real estate investment trust (REIT) landlord tied largely to UHS.[21][22] The genuinely residential market is private: PE platforms (Discovery Behavioral Health, Newport Healthcare, Summit BHC, Pinnacle Treatment Centers) and big nonprofits (Hazelden Betty Ford, Caron, Rogers Behavioral Health).[20][25]

Net: public-market investors get only blended, indirect exposure to 6232, and it tilts toward payers on the IDD side and diversified operators/landlords on the behavioral side. The pure exposure — in both halves — is private.

5. How the money works

Both children run the same core equation, closer to a hotel or skilled-nursing home than to a physician practice:

Revenue ≈ funded/occupied bed-days × collected rate per resident-day, plus ancillary clinical revenue.

Fixed rent and minimum staffing make occupancy (census) the dominant operating lever, and labor is the business — the group's $32.6 billion payroll against $59.2 billion of receipts means wages alone eat well over half of every revenue dollar.[1][2] Where the two halves diverge is who sets the price and who pays it:

• IDD is a rate-taker: states set a Home- and Community-Based Services (HCBS) waiver rate or ICF-IID per-diem, so operators cannot price up. The defining tension is the rate-to-wage gap — reimbursement is fixed, but hourly Direct Support Professionals (DSPs) must be paid a competitive wage — which pins margins in the low-to-mid single digits.[5][7]
• Behavioral has a payer-mix lever: commercial/out-of-network rates are higher than Medicaid, so the profit swing depends on how many beds are filled by private insurance versus Medicaid versus self-pay. Insurance-dependent centers often need 85–90%+ occupancy to make money, and the roll-up model's engine is converting more Medicaid volume into paid stays.[26]

For both, the routes to for-profit returns are the same: scale (centralizing billing, compliance, and HR overhead) and owning the real estate. Neither escapes the labor ceiling. Full mechanics are in the child primers.

6. Demand drivers

Demand across 6232 is large, chronic, and largely disconnected from the economic cycle — but on both sides the binding constraint is funding and workforce, not need.

• IDD: More than 710,000 people sit on Medicaid HCBS waiting/interest lists (about 73% with IDD; average wait ~50 months), and nearly one million U.S. households include an adult with IDD supported by an aging caregiver whose adult child will eventually "age into" paid care. Longer lifespans and rising autism diagnoses keep expanding the eligible population.[4][5]
• Behavioral: In 2023, 20.4 million U.S. adults had both a substance use disorder and a mental illness, and 7.7 million received neither form of treatment. U.S. drug-overdose deaths, though down 26.2% to 79,384 in 2024, remain structurally elevated. Parity law and Medicaid waivers keep converting unpaid need into reimbursable volume.[16][17][18]

In both halves the limiter is the workforce: most Americans live in a federally designated mental-health workforce-shortage area, and DSP turnover runs near 40% at a median wage around $14.50/hour.[7][6]

7. Regulation

Government rules effectively create both markets — the two children just lean on different federal levers.

• Shared spine: the Centers for Medicare & Medicaid Services (CMS) and state Medicaid agencies fund, license, and govern most of the sector. State licensing and incident-reporting apply throughout.[10]
• IDD-specific: the Olmstead v. L.C. (1999) Supreme Court decision and the CMS HCBS Settings Rule (compliance deadline March 2023) drive the shift from institutions to community homes; ICF-IID conditions of participation and the 2024 Medicaid Access Final Rule add compliance load.[10][11][12]
• Behavioral-specific: the "Institution for Mental Diseases" (IMD) payment exclusion and its post-2015 Section 1115 waiver carve-outs govern whether Medicaid can pay for adult residential stays; the Mental Health Parity and Addiction Equity Act (MHPAEA) requires behavioral coverage to be no more restrictive than medical/surgical (its tightened 2024 rule is in litigation-driven non-enforcement); and youth-facility oversight is tightening after federal abuse findings, via the Stop Institutional Child Abuse Act (2024).[18][19][24]
• Antitrust has arrived on the IDD side: in January 2026 the Federal Trade Commission (FTC) required Sevita to divest 128 ICFs before clearing the ResCare acquisition — a signal the unscrutinized roll-up era is ending.[8]

8. Consolidation

A fragmented cottage industry consolidating slowly from the top. At group level the four largest firms hold just 9.4% of revenue, the top 50 under a quarter, and HHI is 34.3 — far below any concentration concern.[2] A private-equity-led roll-up has run for a decade in both halves (buying sub-scale homes/centers and centralizing overhead), but three forces cap it: reimbursement is a hard price ceiling (especially in IDD), operators compete for the same scarce workers, and a large nonprofit-and-government majority is simply not for sale. PE's share of behavioral facilities is still modest (~6–7% nationally) though concentrated, and research indicates PE-owned residential sites tend to charge more and offer fewer ancillary services.[20] The 2026 Sevita–ResCare deal, cleared only with FTC-mandated divestitures, marks the arrival of antitrust as a real ceiling on the growth playbook.[8][9]

9. Risks

The two halves share a risk core and differ at the edges.

• Reimbursement / Medicaid-policy risk (both, dominant): rate cuts, eligibility redeterminations, and budget pressure hit hardest where Medicaid is near-total (IDD) but also unsettle the behavioral payer mix (waiver rollbacks, out-of-network crackdowns, the unresolved parity rule).[5][19]
• Workforce shortage (both): DSP and clinical staffing gaps cap beds and push wages up against fixed rates; most providers turn away referrals for lack of staff.[7]
• Quality, safety, and legal/reputational (both, sharper in behavioral): serving vulnerable populations invites incident, litigation, and enforcement risk. Acadia paid a $19.85M federal settlement in 2024 over medically-unnecessary billing; UHS paid $122M in 2020 under the False Claims Act; scandal at one operator can trigger sector-wide payer and regulatory scrutiny.[23]
• Leverage (both): debt-financed PE platforms are exposed to rate and refinancing pressure on thin margins.[6][20]
• Antitrust ceiling (emerging): the FTC's Sevita intervention shows the roll-up path now carries merger-review risk.[8]
• Measurement: federal employer statistics understate government, nonprofit, and very-small-provider activity — a caution when sizing this market from the figures above.[6][14]

10. How to invest & outlook

Public routes give only blended, indirect exposure and differ by half: on the IDD side, payer-side names (Centene, Molina, Elevance) and diversified HCBS/personal-care operators (BrightSpring, Addus); on the behavioral side, diversified operators and a landlord REIT (Acadia, UHS, UHT) whose economics mix hospital, outpatient, and residential care. There is no listed pure play or ETF isolating either residential IDD or residential behavioral care.[21][22][28] Private routes are where 6232 actually lives — direct ownership of operating platforms or regional providers, net-leased group-home and behavioral real estate, and private credit to operators — underwritten site-by-site on licenses, waiver/payer contracts, occupancy, and staffing coverage. Much of the field (the nonprofit-and-government majority) is not investable in the conventional sense.[6][14]

Outlook. The demand case is about as durable as any in health care — aging IDD caregivers, waiting lists, high unmet behavioral need, and Medicaid waivers converting need into paid volume. But this is a government-rate-influenced, labor-constrained, thin-margin group where three forces reward operational quality over financial engineering: a hard labor ceiling, reimbursement/Medicaid-policy uncertainty, and an intensifying spotlight on billing, youth facilities, PE ownership, and (now) antitrust. Expect continued slow consolidation, with winners pairing a durable payer mix, clean compliance, reliable staffing, and local density. Our ground-truth data contain no national growth forecast for this group, so none is supplied. For the complete analyses, read the 62321 and 62322 primers.

---

Sources

Synthesized from the two child primers (62321, 62322); renumbered for this group-level page.

1. U.S. Census Bureau. County Business Patterns 2023 — NAICS 6232 and children 623210/623220 (establishments, employment, annual and Q1 payroll; excludes nonemployers and most government). https://www.census.gov/programs-surveys/cbp.html
2. U.S. Census Bureau. 2022 Economic Census — Concentration by Largest Firms, NAICS 6232 and children (firms, receipts, CR4/CR8/CR20/CR50, HHI). https://data.census.gov/table/ECNSIZE2022.EC2200SIZECONCEN
3. U.S. Census Bureau. 2022 NAICS Definitions — 623210, 623220 and adjacent codes (622210, 621420, 623110, 624120). https://www.census.gov/naics/?input=6232&year=2022
4. KFF. A Look at Waiting Lists for Medicaid Home- and Community-Based Services from 2016 to 2024, 2024. https://www.kff.org/medicaid/a-look-at-waiting-lists-for-medicaid-home-and-community-based-services-from-2016-to-2024/
5. KFF. 5 Key Facts About Medicaid Coverage for People With Intellectual and Developmental Disabilities (IDD), 2024. https://www.kff.org/medicaid/5-key-facts-about-medicaid-coverage-for-people-with-intellectual-and-developmental-disabilities-idd/
6. Stateline / The American Prospect / S&P Global (via PESP). Private equity in disability services; Sevita ownership, revenue, and leverage, 2025. https://stateline.org/2025/05/16/private-equity-snaps-up-disability-services-challenging-state-regulators/
7. ANCOR. The State of America's Direct Support Workforce Crisis (2024–2025) (turnover ~40%; median DSP wage ~$14.50/hour; 77% of providers turned away referrals). https://www.ancor.org/resources/the-state-of-americas-direct-support-workforce-crisis-2025/
8. U.S. Federal Trade Commission. FTC Takes Action to Prevent Anticompetitive Healthcare Services Merger (Sevita / ResCare), January 2026. https://www.ftc.gov/news-events/news/press-releases/2026/01/ftc-takes-action-prevent-anticompetitive-healthcare-services-merger
9. Home Health Care News / BrightSpring. BrightSpring Finalizes $835M Community Living Divestiture to Sevita, March 2026. https://homehealthcarenews.com/2026/03/brightspring-finalizes-835m-community-living-divestiture-to-sevita/
10. Centers for Medicare & Medicaid Services (CMS). HCBS Authorities (Section 1915(c)); Institutional Long-Term Care / ICF-IID; Olmstead v. L.C. (1999), 2024. https://www.medicaid.gov/medicaid/home-community-based-services/home-community-based-services-authorities
11. KFF. How Are States Implementing New Requirements for Medicaid HCBS? (HCBS Settings Rule, effective March 2023), 2024. https://www.kff.org/medicaid/how-are-states-implementing-new-requirements-for-medicaid-home-and-community-based-services/
12. CMS. Ensuring Access to Medicaid Services / HCBS Provisions (2024 Access Final Rule), 2024. https://www.medicaid.gov/medicaid/access-care/home-and-community-based-services-provisions
13. Dungarvin, About Us, 2026 (https://www.dungarvin.com/about-us/); Blue Wolf Capital Partners, Blue Wolf Capital Acquires RHA Health Services, 2019 (https://www.bluewolfcapital.com/wp-content/uploads/2019/08/08.05.19.RHA-Press-Release.pdf).
14. KFF. A Look at Substance Use and Mental Health Treatment Facilities Across the U.S. (2022 N-SUMHSS data; ownership mix; share offering residential care), 2024. https://www.kff.org/mental-health/a-look-at-substance-use-and-mental-health-treatment-facilities-across-the-u-s/
15. SAMHSA. National Substance Use and Mental Health Services Survey (N-SUMHSS): 2023 (facility inventory, licensing/certification, state oversight), 2024. https://www.samhsa.gov/data/data-we-collect/n-sumhss-national-substance-use-and-mental-health-services-survey
16. Medicaid.gov / Congressional Research Service. Behavioral Health Services — the IMD exclusion and Section 1115 SUD waivers. https://www.medicaid.gov/medicaid/benefits/behavioral-health-services/parity; https://www.congress.gov/crs_external_products/IF/HTML/IF10222.html
17. CDC, National Center for Health Statistics. 2024 U.S. drug-overdose deaths: 79,384, down 26.2% from 2023, 2026. https://www.cdc.gov/nchs/pressroom/nchs_press_releases/
18. SAMHSA. Key Substance Use and Mental Health Indicators: 2023 National Survey on Drug Use and Health (NSDUH) (20.4M adults co-occurring; 7.7M untreated), 2025. https://www.samhsa.gov/data/report/2023-nsduh-annual-national-report
19. U.S. Department of Labor / CMS. Mental Health and Substance Use Disorder Parity — 2024 Final Rule and subsequent non-enforcement (abeyance), 2024–2025. https://www.cms.gov/newsroom/press-releases/departments-health-labor-treasury-issue-final-rules-strengthening-access-mental
20. Behavioral Health Business. Private Equity Owns 6.2% of Mental Health, 7.1% of Addiction Treatment Facilities, 2024. https://bhbusiness.com/2024/05/01/private-equity-owns-6-2-of-mental-health-7-1-of-addiction-treatment-facilities/
21. Acadia Healthcare Company, Inc. Form 10-K for the year ended December 31, 2024 (RTCs = 11% of revenue; salaries-wages-benefits 52.4%; break-even; growth channels), 2025. https://www.sec.gov/Archives/edgar/data/1520697/000095017025029095/achc-20241231.htm
22. Universal Health Services, Inc. Form 10-K for the year ended December 31, 2024 (behavioral division scale; UHT REIT relationship), 2025. https://www.sec.gov/cgi-bin/browse-edgar?action=getcompany&CIK=0000352915&type=10-K
23. U.S. Department of Justice. Acadia Healthcare to Pay $19.85M (2024, https://www.justice.gov/archives/opa/pr/acadia-healthcare-company-inc-pay-1985m-settle-allegations-relating-medically-unnecessary); Universal Health Services to Pay $122 Million (2020, https://www.justice.gov/archives/opa/pr/universal-health-services-inc-and-related-entities-pay-122-million-settle-false-claims-act).
24. U.S. Government Accountability Office. Child Welfare: Abuse of Youth Placed in Residential Facilities (2024, https://www.gao.gov/products/gao-24-107625); Stop Institutional Child Abuse Act (2024).
25. Discovery Behavioral Health, New Majority Ownership (HPS Investment Partners), 2026 (https://www.prnewswire.com/news-releases/discovery-behavioral-health-announces-new-majority-ownership-leadership-appointments-302788985.html); Onex Corporation, Onex Partners Completes Majority Investment in Newport Healthcare, 2021 (https://www.onex.com/article/2021NewsRelease-OnexCompletesNewportHealthcare-July19).
26. Per-diem and occupancy economics: Behave Health, Per Diem Rate — Glossary (https://behavehealth.com/glossary/per-diem-rate); La Hacienda Treatment Center, Inpatient Rehab Facility Cost Per Day (https://www.lahacienda.com/blog/inpatient-rehab-facility-cost-per-day), 2024–2026.
27. Third-party market-size estimates (broader behavioral-health context): IBISWorld, Mental Health & Substance Abuse Centers in the US (https://www.ibisworld.com/united-states/market-size/mental-health-substance-abuse-centers/1597/); Precedence Research, U.S. Behavioral Health Market (https://www.precedenceresearch.com/us-behavioral-health-market), 2024–2025.
28. Centene 2025 Form 10-K (https://www.sec.gov/Archives/edgar/data/1071739/000107173926000049/cnc-20251231.htm); Molina 2025 Form 10-K (https://www.sec.gov/Archives/edgar/data/1179929/000117992926000005/moh-20251231.htm); Elevance 2025 Form 10-K (https://www.sec.gov/Archives/edgar/data/1156039/000115603926000013/elv-20251231.htm); Addus HomeCare 2025 Form 10-K (https://www.sec.gov/Archives/edgar/data/1468328/000143774926005352/adus20251231_10k.htm).