Recent trends have increased pressure on proponents of residential treatment to demonstrate the necessity and the effectiveness of residential treatment for children and adolescents. Despite numerous studies, it is not clear who benefits from residential treatment. Outcomes do differ across facilities, and these differences are not due to characteristics of the residents. The present study investigates whether organizational policies and practices are related to children's rates of recovery. Hierarchical linear modeling techniques were used to evaluate the relationship between four organizational practices and rates of recovery. The sample included 5036 quarterly assessments of 1255 episodes of care for children who were enrolled in 38 residential treatment centers across the state of Illinois between July 2004 and June 2007. The results found the utilization of behavioral treatment plans was predictive of improved rates of recovery for children over the course of treatment. The results did not find a relationship between the other practices and rates of recovery. These findings highlight the importance of developing and implementing organizational practices that are statistically and clinically significantly related to rates of recovery. Adopting empirically supported indicators of organizational quality will help residential treatment providers better demonstrate their effectiveness to other entities within the system of care.