Parent Firm’s Stock Falls After Story on CareUnits

Comprehensive Care Corp.’s stock fell $1.125 to $14.25 Friday following a network television report Thursday evening that accused the Irvine concern of a variety of shoddy practices at its drug abuse hospitals for teen-agers.

In its newsmagazine program “20/20,” ABC interviewed a former counselor at one of the company’s CareUnit hospitals who said many of the teen-age patients never saw a psychiatrist or a psychologist, an allegation that the company denied.

A former CareUnit patient at the company’s Jacksonville Beach, Fla., facility said cocaine, valium and liquor all were available to patients at the center.

“Corrective measures” were taken at the Jacksonville Beach facility after the company learned of the problem in 1984, the company said.

Comprehensive Care called the “20/20” report a “gross misrepresentation” of its adolescent drug treatment programs and said it is withdrawing all its advertising from ABC “in protest over what we consider to be unfair reporting practices.”

For its most recent fiscal year, the company spent $13.6 million on advertising, about 80% of that used for television, the company said. A spokesman said the company could not immediately determine its exact advertising budget with ABC.

ABC officials in New York could not be reached for comment.

For its fiscal year ended May 30, Comprehensive Care reported net income of $13.1 million, compared to net income of $17.2 million for the prior year.

The company operates 160 drug treatment and psychiatric centers around the nation, and “we’re not going to change the way we do business,” said Ken Estes, a company spokesman.