‘There’s No Question’ Buyers Want In On the Outpatient Mental Health Space Post-CARE Counseling-Optum Deal

Optum owned Refresh Mental Health’s acquisition of outpatient mental health provider CARE Counseling was a bright spot in a slow dealmaking environment. Still, the transaction may provide insights into the near future of outpatient mental health M&A.

The tie-up illustrates that interest in outpatient mental health dealmaking is still strong. It also shows that Refresh Mental Health is still, at some level, an acquirer, even after blitzing through a private equity-backed roll-up play. In the same vein, it also illustrates that Optum will continue to be a terminal acquirer of compelling health care assets despite scrutiny of its size and reach in health care. 

“If you had another ten CARE Counselings available for acquisition, they would all sell,” Steve Garbon, managing director of behavioral health at the M&A firm The Braff Group, told Behavioral Health Business. “There’s a ton of demand. I don’t have any less interest in the mental health space now than I did a couple years ago when health care M&A was hot.”


While off from the all-time highs of 2021, overall deal volume for mental health companies remains strong, elevated above historic levels. Data from the Braff Groups show 56 deals were completed in 2023. Still, the high demand for mental health company deals is a relatively recent phenomenon. The Braff data shows that more mental health deals were done from 2020 to 2022 (202) than from 2015 to 2019 (186), according to The Braff Group. 

In April, BHB exclusively reported that Refresh Mental Health had acquired St. Louis Park, Minnesota-based CARE Counseling. The terms of the deal were not disclosed. CARE Counseling employs about 260 people, according to PitchBook. It operates 10 clinics in and around Minneapolis, Minnesota, and  offers telehealth services. Before the deal, Refresh Mental Health only operated one location in the Twin Cities metro area (DBT-PTSD Specialists of Minnesota), according to its website

CARE Counseling identified itself as one of the fastest-growing companies in the U.S., regardless of industry, by participating in Inc. Magazine’s Inc. 5000 list of fast-growing companies. According to those publications, it posted 440% revenue growth from 2019 to 2022 and 394% from 2018 to 2021


The speed of CARE Counseling’s growth reflects scalability, a fundamental interest for investors and other behavioral health companies looking for deals. However, that is in short supply in the M&A marketplace now and contributes to the slowdown in dealmaking.

“Buyers and investors want to be in the space; there’s no question,” Garbon said. “The challenge is to find an entry point: a sizable asset with the infrastructure to continue to build out. It’s just difficult to find.”

Garbon and other experts in the field have told BHB that the flurry of dealmaking activity that peaked in 2021, which has since slowed, depleted the candidate pool of obvious platform investments and clear add-on acquisition targets. Many companies now left as potential acquisition targets are simply too small or lack the infrastructure to be compelling targets.

Still, the deal shows that Refresh Mental Health, ostensibly the second-largest outpatient mental health provider in the U.S., is still an acquirer. Optum, the services division of the health care conglomerate UnitedHealth Group Inc. (NYSE: UNH) acquired Refresh in 2022.

Refresh Mental Health was founded by Steve Gold and Dr. Mark Gold in 2017 with the backing of New York City-based Lindsay Goldberg & Co. LLC. Refresh then traded hands from Lindsay Goldberg to Kelso & Co. in December 2020 and, again, just 15 months later, to Optum. Under Lindsay Goldberg, the company to over 200 outpatient locations in 29. When it was sold to Optum, it operated more than 300 locations in 37 states.

“The bottom line is that Optum/Refresh is still looking to expand their outpatient mental health business: It just took them about [two years] to get their feet back under them,” Kevin Taggart, founding director of the M&A consulting firm Mertz Taggart, told BHB.

While it’s not obvious that the span between the deals was intentional, it’s reasonable to expect that it may have taken some time to integrate a new health care provider asset into the Optum corporate environment. There have been several changes since then.

Refresh Mental Health’s CEO, Steve Gold, is no longer with the company. Optum declined to specify the nature and timing of his departure. Earlier in the year, the company shuttered its eating disorder treatment division. Further, UnitedHealth Group has been downsizing its headcount at other assets, including Optum Virtual Care (which has been shut down), the software company naviHealth and its at-home business, Landmark Health.

Further, the company has been under a federal antitrust investigation for the better part of the year, regarding the reach of Optum and UnitedHealthcare, according to other media reports. 

The CARE Counseling-Refresh Mental Health tie-up is also something of a departure from the norm for outpatient mental health dealmaking. Optum is seen as the last major stop for a company after it trades hands a few times and reaches a major scale or other high level of maturity. In this case, CARE Counseling skipped to the end. According to Pitchbook, the company never had investor backing.

Looking ahead

On top of some degree of candidate pool depletion, Taggart says several buyers have been very active in the last few years and are taking time to assess and digest those acquisitions. One exception to the slowdown in 2023 was ARC Health, an outpatient mental health platform backed by The Thurston Group. ARC Health, formed in 2021, completed 18 acquisitions by the end of 2023. That company announced one deal in 2024: Mindsoother Therapy Center in Livingston, New Jersey.

What deals are getting done are at provider groups that have both psychiatric and therapy services, Taggart said. Mertz Taggart tracked that 26% fewer mental health deals were completed in 2023 compared to the year before. 

Despite the interest, something apparently needs to give to get dealmaking and investment moving again.

High interest rates are often a critical barrier to investment. But Garbon said that’s a “low-hanging fruit” for considering what could change the dynamics of dealmaking in outpatient mental health. Positive inflation developments may encourage investors to move. Perhaps a blockbuster deal or even a downbeat deal could reset expectations for companies and investors on both sides of the equation.

On the more creative side, investors and entrepreneurs who are otherwise on the outside looking into outpatient mental health may consider starting their own platforms de novo. The investment and financial giant KKR has done this in mental health and autism therapy with Geode Health and BlueSprig Pediatrics, respectively. The latter is now one of the largest in its industry.

“It won’t be perfect — there’ll be ups and downs — but once that momentum shifts to a little bit more towards the positive, I think you’ll see that there are a lot of buyers and investors that are anxious to really get back into the marketplace in a much more meaningful fashion,” Garbon said.

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