LAKE OZARK, Mo. (AP) — An Associated Press investigation finds that private, for-profit residential treatment centers that care for adopted kids at exceptionally high rates are often funded by taxpayer dollars, but are subject to little oversight and few consequences after allegations of abuse and neglect.

The investigation looks deeply at a facility in rural Missouri called Calo Programs, or Change Academy at Lake of the Ozarks, which costs as much as $20,000 a month and attracts families from all over the country, who send their children across state lines to the facility.

Calo promises relief for desperate parents whose adopted kids are struggling — a lakeside, summer camp-like academy where kids can heal by bonding with golden retrievers, where caring employees “create joy.”

But the AP report paints a more complicated and less idyllic picture.

Law enforcement is often called to Calo to investigate assaults or track down runaways. State agencies that pay to send kids there have questioned its operations, training and transparency. Parents and former employees say there is minimal treatment and barely any schooling, with only young, poorly trained staff to supervise the kids. Two mothers described it as something out of “Lord of the Flies.”

In emailed statements, Calo denied allegations of wrongdoing, and said student outcomes prove the strength of their approach: “For nearly two decades, Calo has provided innovative treatment and critical mental health services for young people who have been failed by the system. Over and over again, parents across the country have come to us in their moment of need, and we are proud of the track record we’ve established helping treat their children and return them to their families with the skills and tools they need to get ahead.”

The AP obtained troves of state data and documents through public records requests, and interviewed young adults who recently attended, parents who sent their children there, former employees and lawyers engaged in more than a dozen lawsuits against the company.

You can read the full story here. Here are the takeaways:

Runaways, assaults, injuries

Hundreds of pages of Camden County Sheriff’s Office reports documenting calls to the facility from 2020 to the fall of 2025 show that children in Calo’s care have been alleged victims, witnesses and perpetrators.

There was the free-for-all last summer when escaping girls ran toward the woods and jumped into the lake to swim away, employees chasing them and returning them, only to see them escape again. (Calo said none of them were injured.)

Just before that, sheriff’s deputies wrote that two kids had reportedly gotten high on methamphetamine that a Calo employee brought in her purse. (Calo said the employee was fired and the substance was never confirmed to be meth.)

Not long before that, deputies called to Calo were told that staffers were outnumbered as teens “stormed” a room to attack another student. One boy climbed onto the roof and jumped, landed on rocks below and had to be airlifted to the hospital. (Calo said altercations happen among troubled kids, that the staff followed protocol in calling for help, and the boy who jumped sustained a sprained ankle.)

A mother from Illinois reported in 2024 that her daughter and another girl had been sexually assaulted by another child. She said Calo didn’t notify them, the state or law enforcement. She alleged Calo covered it up.

Her daughter’s stay there was paid for by the state of Illinois, through a little-known program called the Family Support Program run by the Illinois Department of Healthcare and Family Services that is designed to fund behavioral health care. She and other Illinois parents told AP that they believed the state had vetted the program because it paid for so many kids at Calo.

That agency and the Illinois State Board of Education both list Calo among approved residential treatment programs they fund. Over the last decade, the two Illinois agencies have spent more than $35 million sending kids to Calo, according to data obtained by AP.

Last year alone, the Board of Education paid more than $1.6 million to send 13 kids there for special education services; Healthcare and Family Services spent $1.2 million for 19 kids. Some families used money from both.

Bill Hayden said he also used Illinois education money to send his daughter, who was adopted from Russia, to Calo a decade ago. The retired doctor was among families that Calo asked be interviewed. Hayden told AP he believes Calo changed his daughter’s life.

“I felt that they were dedicated professionals who were trying to do their best with about the toughest group of kids you could probably ever house,” Hayden said.

Remarkable profits, struggling kids

Calo is part of the so-called troubled teen industry, a sprawling network of loosely regulated, for-profit residential centers, boarding schools and wilderness programs that have been quietly institutionalizing adopted children at extraordinarily high rates.

Calo opened in 2007 with 40 beds and has expanded greatly since, with a capacity of 144 this year. It specializes in adoption trauma and says 90% of its clients are adopted.

Calo was acquired around 2011 by a private equity firm led by the Stanford-graduate Alex Stavros, who over the next 13 years expanded the business by merging with other treatment centers to become the parent company Embark Behavioral Health. Stavros, who stepped down in 2024, did not respond for comment.

Stavros claims in his LinkedIn profile that he built Embark to 38 programs across 20 states and achieved a remarkable 40-fold increase in revenue, to $180 million. Under his leadership, Calo shifted its business model “from entirely private pay to majority third party reimbursed,” including both private health insurance and Medicaid, and a range of government programs.

In the thick of the COVID-19 pandemic, as residential programs struggled with enrollment, Embark called on dozens of industry people to talk business strategies. “DOING EPIC SH$T” was printed on the cover of the August 2020 “Embark Academy Sales & Marketing Conference” handbook. It featured a session on how to “overcome objections” with sales tactics to “build your client base and keep your pipelines full!”

In a session that touted admissions as a vital part of the treatment team, the handbook noted: “The admissions person sells hope when the family is at their lowest and most hopeless, scary, and vulnerable time.”

The company defends its marketing efforts aimed at families in distress.

“It is a common misconception that for-profit entities are more expensive or less ethical than non-profit organizations,” Calo said in a statement. “Reaching them through thoughtful outreach and advertising helps break down the mental health stigma that keeps people from seeking treatment …”

‘Making money off these kids’

Some officials have expressed skepticism about Calo’s business model.

Stacy Roberts, who runs the local juvenile detention center, said his agency is frustrated by Calo and processes as many as a dozen cases each year involving Calo kids who live out of state.

Many families have decried the conditions at Calo as jail-like. Roberts rejects that comparison — because traditional juvenile detention centers like his are held to a higher standard, he said. Unlike Calo, Roberts answers to the public, a judge and the juvenile justice system, which monitors children’s stays within his facility.

“It’s a business,” Roberts said. “They’re not doing this because they want to help. They’re making money off these kids.”

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Ho is a former Associated Press reporter.