Psychiatric Practices NAICS 621112
Unlock access to the full platform with more than 900 industry reports and local economic insights.
Get access to this Industry Profile including 18+ chapters and more than 50 pages of industry research.
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
May 15, 2025 - Medicaid Cuts Now Under Consideration may Delay Treatment For Some
- More people will delay treatment for mental health problems if the US Congress reduces 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.
- Healthcare providers are pushing back against recently updated federal security standards that are intended to better protect patient data against cyberattacks, according to Axios. The new requirements mark the first major overhaul of the Health Insurance Portability and Accountability Act's Security Rule in more than a decade. Many healthcare system administrators say that the new standards are unworkable and too expensive, according to Axios. Providers say they simply don't have the resources to hire experts or have the bandwidth to meet testing requirements or annual assessments of their systems that the rule requires.
- 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.
- Psychiatric practice industry employment and average wages for nonsupervisory employees increased slightly during the first three months of 2025, according to the US Bureau of Labor Statistics. Psychiatric practice sales are forecast to grow at a 5.46% compounded annual rate from 2025 to 2029, 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 15% 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
Vertical IQ Industry Report
For anyone actively digging deeper into a specific industry.
50+ pages of timely industry insights
18+ chapters
PDF delivered to your inbox
