Psychiatric and Substance Abuse Hospitals NAICS 622210

Jul 14, 2026 - Number Of Psychiatric Beds may Be Inadequate

• The United States has seen a dramatic decrease in the number of psychiatric beds nationwide due in part to deinstitutionalization and the rise of antipsychotic drugs, according to the American Psychiatric Association. That has created a critical bed shortage. The number of hospitals with inpatient psychiatric units dropped significantly from 2011 to 2023, according to a 2025 study published on JAMA Network Open. Another study from that year found that this country has 28.4 inpatient psychiatric beds per 100,000 people, not even half the 60-bed ratio researchers frequently refer to as the optimal level.
• Enhanced staffing requirements for psychiatric hospitals in California were enacted in early June. California is often referred to as a "policy incubator" because the state regularly passes groundbreaking legislation that serves as a model for other states and the federal government. The California Department of Public Health emergency regulations specify that the hospitals must assign one nurse for every six patients in adult psychiatric units and one nurse for every five adolescent patients. Hospitals found in violation of this standard can be fined $15,000 to $30,000 per day. Major healthcare worker unions and front-line caregivers have supported the reforms as an essential step to improving treatment in locked facilities where patients are often held against their will.

• Between 2023 and 2024, 126 hospitals across the US shut down their inpatient psychiatric units, according to data provided to Stateline by the American Hospital Association. Psychiatric and substance abuse hospitals compete with hospitals, residential facilities, comprehensive treatment centers, and emergency departments. "(Psychiatric units) are often in the red, and, for lack of a better word, kind of subsidized by the rest of the health system," said Sarah Steverman of the National Association for Behavioral Healthcare. The mental health field is also struggling with workforce shortages across states, especially in rural areas. More than 122 million Americans lived in designated mental health professional shortage areas as of December 2024.
• Psychiatric and substance abuse hospitals increased prices 2.8%% year over year in June, according to the US Bureau of Labor Statistics (BLS). Psychiatric and substance abuse hospital industry employment and average wages for nonsupervisory employees increased slightly during the first five months of 2026, according to the BLS. Psychiatric and substance abuse hospital sales are forecast to grow at a 5.28% compounded annual rate from 2026 to 2030, faster than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc.