Psychiatric Practices NAICS 621112
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Industry Summary
The 12,500 psychiatric practices in the US provide mental health care through private practices, group practices, or medical facilities (hospitals, HMOs). Firms generate the majority of revenue through visits and consultations. Other sources of revenue include non-surgical interventions. Psychiatric practices may specialize in a particular type of disorder (eating disorders, behavioral problems, substance abuse) or patient (elderly adults, children, adolescents).
Dependence on Referrals
Because psychiatric care is highly personal and involves sensitive information, many patients rely on referrals to obtain services.
Drug Treatment Prevails
The advent of prescription drugs to treat mental illness created a fundamental shift in how the medical community provides psychiatric care.
Recent Developments
Jul 9, 2026 - Workforce Shortage Expected To Intensify
- The supply of psychiatrists is projected to decrease over the next decade despite a steady uptick in interest in psychiatry among medical students, according to research published in the Journal of Psychiatric Research. The expected decrease is due to the large number of senior psychiatrists retiring. Psychiatry is ranked last among other disciplines in terms of the ratio of supply to demand for services, with decreasing capacity through 2038.
- Enrollment in Affordable Care Act (ACA) health insurance plans through Healthcare.gov has modestly decreased, according to the Washington Post. The ACA resulted in an extraordinary expansion of mental health and substance use disorder coverage, according to the National Alliance on Mental Illness. About 20 million people gained insurance coverage because of the ACA, including 15.3 million who became eligible for Medicaid. The ACA resulted specifically in significant reductions in the uninsured rate for individuals with mental health conditions and one study showed the share of people going without mental health care due to cost decreased by about one-third.
- More people will delay treatment for mental health problems now that the federal government has cut Medicaid funding, according to Spencer Hospital (IA) CEO Brenda Tiefenthaler. The US Congress is considering plans to cut Medicaid to help pay for tax cuts, according to health policy organization KFF. Medicaid recipients are particularly likely to need mental health care. More than a third of nonelderly Medicaid enrollees have some sort of mental illness, according to KFF. Medicaid covers health care for about 72 million Americans with low incomes or disabilities, according to National Public Radio.
- Psychiatric practice industry employment and average wages for nonsupervisory employees increased slightly during the first two months of 2026, according to the US Bureau of Labor Statistics. Psychiatric practice sales are forecast to grow at a 5.45% 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.
Industry Revenue
Psychiatric Practices
Industry Structure
Industry size & Structure
The average psychiatric practice operates out of a single location, employs 7 workers, and generates about $803,000 annually.
- The psychiatric services industry consists of about 12,500 firms that employ about 83,800 workers and generate about $10.1 billion annually.
- The industry is extremely fragmented; the top 50 companies account for less than 25% of industry revenue.
- Most psychiatric practices are small, independent firms that operate locally. State licensing requirements create geographical restrictions.
- Large practices, such as Psychiatric Solutions, operate as part of hospitals or inpatient psychiatric care providers, such as Universal Health Services (UHS).
Industry Forecast
Industry Forecast
Psychiatric Practices Industry Growth
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