Economic uncertainty heading into 2023 will drive several existing trends that orbit around the topic of value-based care. In turn, economic pressure and increased focus on value will demand that mental health providers sharpen their proverbial pencils.
The prognostications below come from executives of some of the largest incumbent companies and growing startups in the mental health space. Each had a different take on the same two questions: What will be the defining market forces of 2023? And what will your organization do about them?
Taken as a whole, many executives expect that 2023 will require mental health providers to prove their value to patients, providers and payers alike.
The economic pressures that precipitated layoffs across the economy — including in behavioral health — have not gone away. And should conditions worsen, more people may find themselves and their families without private health insurance and without a source of income. That, in turn, may magnify the present patient-access hurdles in behavioral health and challenge providers that rely on cash-pay revenue.
Meanwhile, the year ahead is likely to see the fight for clinical talent heat up, with the companies that invest in workforce-retention programs taking advantage.
On the payer side, health plans are expected to keep a focus on behavioral health’s relationship with physical health, meaning they’ll expand holistic approaches to health insurance. This will drive more and deeper conversations about what and how health plans pay for mental health services.
Additionally, new entrants into the mental health space and the expansion of existing companies will give patients more choices than ever. This will put pressure on providers to give superior customer experiences.
Responses were edited for length, clarity and style.
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The pandemic and its associated challenges will hopefully become increasingly distant in the rear-view mirror. However, in many ways, the pandemic did push us to become more creative and to innovate faster. Related to technology and digital transformation, I expect to see future-oriented innovations that will assist us in enhancing operations, care delivery and patient experience. Our industry will continue to see new models that increase accessibility, drive efficiencies and improve quality across the care continuum.
The stigma related to mental health that was once stifling to those needing to seek treatment has waned as awareness and understanding has increased. Everyone knows someone. Individuals receiving proper treatment can go on to live very fulfilling and successful lives. With the launch of 988 as a national resource in 2022, I believe awareness will continue to increase. Barriers to seeking help will continue to decrease.
We know there are a lot of people who need our behavioral health services whom we want to be able to treat, but we cannot grow services without more staff. We believe the staffing challenges experienced across the health care sector will normalize to a significant extent in 2023.
— Marc D. Miller, President and CEO, Universal Health Services (NYSE: UHS)
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Inflation, the threat of recession, and the ongoing wave of corporate layoffs will have huge impacts on the behavioral health industry in 2023 — with the environment creating both a greater need for and financial burden on services. With this in mind, demonstrating the value of care will be more important than ever before.
This will drive demand for more quantitative methods of proven outcomes from clients, payers and government agencies working with mental health organizations. This will further expose digital-only companies to risk, something we’re already starting to witness on the back end of 2022, as improvements are frequently linked to human-to-human care.
Focusing on quality will make the recruitment, development and retention of clinical talent hugely important. However, as the mental health professional shortage continues, this will be increasingly challenging.
Behavioral health organizations will need to reevaluate how they view their clinicians. As the key drivers of successful business and client care outcomes, Thriveworks will continue to provide clinicians with opportunities to grow their skill sets, expand their careers and secure the support they need in and outside of work. All while equipping them with the tools to do their best work.
The year ahead will also see a greater uptake of in-person services, or the ability to take a hybrid approach with virtual care as circumstances require. The demand for hybrid services will extend to even smaller cities and communities.
— Will Furness, CEO, Thriveworks
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As we look forward to 2023, we believe there will be a handful of consistent themes defining the behavioral health market. Among them:
– We will continue to see growing patient demand and limited clinician supply
– A likely recessionary environment will drive further tailwinds for in-network providers and a tougher market for cash-pay practices
– While we’ve seen an increase during the pandemic of care being sought online — and it will remain at an elevated level versus the pre-pandemic experience — we believe we’re also going to see a demand from both patients and providers to return to in-person care.
This is why at LifeStance, we’re very focused on the hybrid model and are built to accommodate where both patient and clinician demand is moving. This will continue to be a core tenant of how we operate as a company.
— Danish Qureshi, President and COO, LifeStance Health Group Inc. (Nasdaq: LFST)
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With ongoing labor shortages, wage increases and consolidation across the industry, the price of health benefits will continue to increase in 2023, and the issue of affordability and cost savings will be top of mind for both payers and purchasers alike.
Despite these challenges, our mission to deliver affordable, quality mental health care to our members remains unchanged. And at a moment where there is such a high, continually growing demand for these resources across the country, the individuals and companies we work with are counting on us and the services we provide more than ever. That’s why we are working together to offer pricing models that take into account the entire benefits ecosystem and member journey to more seamlessly meet clients and consumers wherever they are.
— Jon Cohen, CEO, Talkspace (Nasdaq: TALK)
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Health plans are going to continue to double down on mental health. As the data continues to demonstrate the immense value and ROI of mental health support, health plans will invest in increasing access to these tools while balancing cost-effectiveness. There’s a shifting mindset to prioritizing outcomes over volume, particularly in mental health care. With this, we will start to see an increase in value-based contracting in the space.
At Headspace Health, we’ll continue to double down on our B2B business with health plans as a primary avenue for reaching more individuals. We also plan to explore additional value-based arrangements where we are paid on engagement and outcomes, as proven effective by our collaboration with Blue Cross Blue Shield of California. Further, we are prioritizing clinical studies and research — conducted both internally and by third-party academic institutions. A robust body of evidence on the effectiveness of our offerings will demonstrate the value of our offering to payers and align with outcomes-based payment models.
In 2022, we saw utilization rates and stock prices alike flatline amongst the big public telemedicine players as patients returned to brick-and-mortar facilities. However, utilization rates for virtual behavioral services like ours remained steady, and continue to increase due to global demand.
Our business and others like ours have demonstrated that regardless of pandemic restrictions, members overwhelmingly prefer virtual modalities when it comes to mental health. Virtual mental health will continue to buoy the telemedicine market in 2023.
As a virtual-first mental health provider, we are focused on maintaining and implementing our unified experience, which enables seamless navigation between self-guided content, coaching and higher-acuity care. Virtual modalities also provide an opportunity for population-specific content, tailored to unique individual experiences. We’ve done a lot of work this past year to diversify and expand our culturally-competent content, and we plan to continue leaning into content that serves multi-identity populations. We believe that authenticity and inclusivity will enable consistent utilization and improved outcomes over time.
— Russ Glass, CEO, Headspace Health
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The defining forces in behavioral health will be around customer service for clients. As the field grows and people have greater opportunity to choose a provider, the ones who prioritize ensuring good quality care, ease of access and lots of options for how people receive care will matter most. Helping people find the right fit for therapy is essential to the goals they are trying to achieve and the overall experience being a positive or negative one. Having providers who focus on customer service, including clinician matching, low hold times and short wait times, will be key!
At Ellie Mental Health, we are investing our time and energy into making sure folks can access care from whatever platform they connect with the most — phone, internet, App Store, in-person or via telehealth. As we expand across the United States, we will focus on ensuring accessibility for all, along with enhancing our Ellie match system to maximize positive experiences from the start!
— Erin Pash, CEO, Ellie Mental Health
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In 2023, the job market will continue to see a major downturn. Organizations will be forced to be even more cash conservative, and this means additional layoffs for many. As a result, hundreds of thousands of Americans and their dependents will lose health insurance.
Sesh makes therapist access affordable — even without insurance coverage — by offering unlimited access to interactive, therapist-led sessions for $60 a month. We have also launched the SeshCares program, which provides those who have been laid off with access to our platform for a full year at no cost to them.
More layoffs will also drive organizations to invest in the mental health and well-being of those who they choose to keep on the payroll. Employees who engage with Sesh feel more connected, productive, and positive after attending Sesh groups.
Finally, financial uncertainty can trigger mental health concerns such as anxiety and depression. Left only with behavioral health solutions that are unattainable for most, the effects of an economic downturn will snowball into an avalanche-like mental health crisis. Sesh is breaking down cost, access, and the unspoken isolation factor of needing and seeking support.
— Vittoria Lecomte, Founder and CEO, Sesh
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The first defining market force we’re seeing heading into 2023 is the role of the employer in providing mental health benefits and care for employees and their families. What started as a cultural conversation fueled by the pandemic transitioned into an expectation that employers are responsible for supporting mental health. Before the pandemic, 60% of employees said they thought mental health was something they should handle without employer assistance. By June 2021, 62% said they believed their employer had a responsibility for their mental well-being.
The second defining force we’re excited to see is further investment in proactive and preventative mental health care. Typically reserved for primary care for physical health, we’re seeing a demand for interventions that meet people far earlier on their care journey. Instead of waiting for an acute moment of crisis, this fundamental shift will most importantly improve the quality of life for people and notably lower healthcare costs over time. While this isn’t a transition that can happen immediately given the current structure and resources of the U.S. mental health care system, this vital shift is something we’ll likely hear a lot more about in 2023.
Real is proud to partner with employers of all sizes to provide comprehensive mental health benefits to their employees. We’ll continue scaling this part of our business to meet the growing demand for higher quality, better utilized and lower-cost care. In addition to providing employers with a care model that scales to all of their employees, we’re proud to support the one internal team that typically receives additional tasks and rarely receives additional support, the HR Team. We’re proud to partner with people leaders to provide quality mental health care to all of their employees.
Real’s care model exemplifies this shift towards proactive and preventative mental health care. Instead of treating mental health in isolation or only when an acute moment of crisis happens, Real has always been committed to making mental wellness an essential part of well-being. Looking ahead to 2023, this will continue to come to life in the content we create and how we meet people where they are. Whether they are spiraling with negative thoughts at 1 a.m. in bed, feeling disconnected from their body in a dressing room, or are working hard to build better communication skills with their partner, Real meets them where they are in everyday life.
— Ariela Safira, Founder and CEO, Real