The Fastest-Growing Behavioral Health Providers’ Secret Sauce

The behavioral health industry has produced some of the nation’s fastest-growing companies despite the macroeconomic headwinds.

In mid-August, 36 behavioral health companies appeared on the Inc. 5000 list of the fastest-growing companies in the U.S. These companies, in no small part, developed strategies to overcome industry challenges. On top of that, executives whose companies were on the list told Behavioral Health Business that prioritizing corporate infrastructure was key.

“That was something that really allowed us to scale rapidly — being very thoughtful upfront about what our future company would need as we scaled up,” Eric Frieman, the co-founder and CEO of hybrid addiction and mental health treatment provider Forge Health, told BHB. “We were very thoughtful over the last few years while other providers were growing and scaling because there is so much demand to go after. They’re now facing the challenges of what happens when you grow too quickly.”

Founded in 2016, Forge Health saw revenue increase by 324% from 2019 to 2022, the period examined for the Inc. 5000 list. It ranked No. 1,722. The company raised about $21.5 million in venture capital funding in 2022 across two distinct rounds. Its primary investor is HC9 Ventures.

The company works with hospitals, primary care groups and payers to provide access to behavioral health care that addresses substance use disorder (SUD) and mental conditions independently and when they co-occur.

In part, addiction treatment and mental health providers such as Forge Health are operating at a time when demand for and openness on the part of patients to get care have never been higher. The impact of the coronavirus pandemic and related crises aided in this.

“On top of that, it’s become clear to health organizations, employers, government agencies that providing for people’s mental health and substance use needs is absolutely critical,” Frieman said.

COVID tailwinds persist

For all the damage the pandemic caused, it laid bare the need for much greater investment in mental health services at all levels. The pandemic alone didn’t cause the problem; Americans’ mental health has been worsening for years. These and other factors created an ideal environment for providers to do well over the last few years, to the point that a behavioral health-related technology company topped this list this year.

CareBridge saw revenue grow by 157,144%. It provides software and telehealth support for those who need long-term support services, often due to intellectual or developmental disabilities.

“COVID accelerated our growth, but the pandemic just turned the lights on in the room where a mental health crisis already existed,” Dr. Bob Booth, chief care officer of TimelyCare, told BHB.

Founded in 2017, the company provides integrated behavioral and primary care as well as self-guided services to college students in partnership with higher education institutions. It landed at No. 175 with 3,015% in revenue growth, the second-most among behavioral health organizations.

In 2023, TimelyCare will have signed over 100 new campus partnerships, including with the University of Texas System, Indiana University and the Texas State University System.

The pandemic also aided TimelyCare and other organizations that bet on using telehealth to increase access. The latest shows telehealth use for mental health services alone is up over 1,000% compared to the pre-COVID era.

Meeting specific populations’ behavioral health needs

TimelyCare’s telehealth solutions cater to the unique needs of college students. Colleges themselves often struggle with understaffing. Further, there is a distinct difference in what young adults expect regarding service delivery compared to just 10 years ago. 

“Colleges and universities can’t keep up with the increased demand for mental health services, and most students don’t remember a world without iPhones,” Booth said, adding that college students need the privacy and flexibility virtual care provides to accommodate their schedules.

Further, Gen Z is the most open generation to discussing mental health issues.

Child populations in the U.S. have also experienced accelerated rates of autism diagnosis. Over the last 10 years, the prevalence of autism has increased by about 188%, according to CDC data.

That has been a boon and a challenge for autism therapy providers. The Inc. 5000 included seven autism therapy companies, including the large school-based services provider Boston-based The Stepping Stones Group. The company operates in 45 states and serves about 300,000 children a year. Even as a large incumbent organization, it saw revenue grow 248% and secured the No. 2,366 rank on the Inc. 5000 list.

“Our continued growth can be attributed to our remarkable team,” Stepping Stones Group CEO Tim Murphy said in a statement. The company declined further comment.

Danville, California-based Behavior Nation landed at No. 1,329 with 438% revenue growth. Founded in 2017, the company provides autism therapy in centers, at home, in community settings and online. Ahilya Lakhanpal, chief clinical officer for the company, told BHB that autism therapy’s mainstay intervention, applied behavior analysis (ABA), is still experiencing a rush of patients with state insurance mandates in all states.

“It was also very difficult for families in most cases to afford the services given that these are really intensive services,” Rushal Patel, Behavior Nation’s CEO, told BHB. “With insurance coverage, that has basically given much more access for caregivers and families to these services.”

Further, general awareness about autism among Americans enables conversations about getting early intervention treatment for autism. Behavior Nation also increases its reach with online content and free social skills practices that can include neurotypical patients. The company also provides mental and behavioral services to children who may otherwise not have autism, including ADHD.

Behavior Nation serves 22 regions across Oregon, Colorado and California; most of its locations are in California.

Motivated B2B partners

TimelyCare and Forge Health have been able to find motivated institutional partners to help lead potential patients to their respective organizations.

Behavioral health programs are important to higher education institutions because mental health is a key driver of dropout rates. Further, major payers are seeing increasing behavioral health benefit spending to prevent other forms of potentially costlier physical health care.

However, institutional partners, e.g., health plans and employers, have faced a glut of mental health service providers and point solutions as billions of venture capital have been pumped into digital mental health services.

“Our key value proposition is the fact that we are a one-stop shop,” Frieman said. “In an industry filled with point solutions, that is a huge differentiator.”

The company’s core treatment types are intensive outpatient programs (IOP) and outpatient services. Forge Health does not treat eating disorders or serious mental illnesses such as schizophrenia as primary diagnoses.