Mental Health Practitioners
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 36,000 mental health practitioners in the US diagnose and treat mental, emotional, and behavioral disorders and problems due to mental illness, alcohol and substance abuse, physical and emotional trauma, or stress. Practitioners include psychologists, counselors, therapists, social workers, and nurses. Practitioners may operate private or group practices or work within third-party facilities, such as hospitals, medical centers, substance abuse treatment centers, hospitals, and colleges.
Dependence on Third-Party Payers
Mental health practitioners are highly dependent on government programs and third-party insurers to pay for services.
Battling The Stigma
The stigma associated with mental health problems often discourages individuals from seeking help and can delay treatment.
Industry size & Structure
The average mental health practitioner operates out of a single location, employs about 5-6 workers, and generates $556,000 annually.
- The mental health practitioner industry consists of about 36,000 establishments that employ about 204,000 workers and generate $20 billion annually.
- The industry is highly fragmented; the top 50 companies account for 11% of industry revenue.
- The industry does not include psychiatrists, psychoanalysts, and psychotherapists having the degree of MD (Doctor of Medicine) or DO (Doctor of Osteopathy).
Industry Forecast
Mental Health Practitioners Industry Growth
Recent Developments
Oct 3, 2024 - Health Spending Continues Increasing
- US health spending increased 7.7% year over year in June and represented 17.8% of GDP, according to health care nonprofit organization Altarum. Personal health care spending increased 8.1%, year over year in June, with utilization growth continuing to outpace price growth. The overall Health Care Price Index (HCPI) increased 2.9% year over year in June. The HCPI increased 3.4% year over year in May and 2.9% year over year in April. Economywide inflation decreased in June, with year-over-year growth in the overall Consumer Price Index (CPI) decreasing slightly to 2.9% and growth in the Producer Price Index (PPI) dropping to 2.2%.
- Private health insurers will be required to cover mental health care and addiction services the same as any other condition under a final rule released by the Biden administration. Most provisions in the rule will apply to group health plans and health insurance issuers for plan years starting January 1, 2025, or after. The Association for Behavioral Health and Wellness, the Blue Cross Blue Shield Association, and the ERISA Industry Committee, a major employer group, said the rule would have “unintended consequences” that could raise costs and jeopardize access to mental health care. Addressing the shortage of mental health providers is a top priority, the groups said, but “the final rule will complicate compliance so much that it will be impossible to operationalize, resulting in worse patient outcomes.”
- Private equity firms are buying behavioral health and substance use disorder services nationwide, according to a study published in the journal JAMA Psychiatry. Researchers found that 642 mental health clinics and 1,152 clinics treating substance use disorders had undergone private equity acquisition between January 1, 2012, and July 31, 2023, constituting 6.2% of all mental health facilities and 7.1% of addiction treatment facilities nationwide. Private-equity-owned practices accounted for roughly a quarter of all facilities providing mental health treatment in Colorado, Texas, and North Carolina.
- Mental health industry employment increased significantly while wages for nonsupervisory employees increased slightly during the first seven months of 2024, according to the US Bureau of Labor Statistics. US mental health industry sales are forecast to grow at a 6.08% compounded annual rate from 2024 to 2028, faster than the growth of the overall economy, according to Inforum and the Interindustry Economic Research Fund, Inc.
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