CMS Targets Psychiatry Shortage With Final Rule

America continues to grapple with a persistent behavioral health workforce crisis, with just over a quarter of the national mental health needs met.

The situation is particularly dire in psychiatry, with projections estimating a 20% decline in the number of adult psychiatrists by 2030, even as demand continues to rise.  

The U.S. Department of Health and Human Services recently issued a final rule designed to combat this shortage, designating funds to inflate the psychiatry workforce and support underserved communities.

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The final rule implements section 4122 of the Consolidated Appropriations Act of 2023, which provided Medicare with funding for at least 200 new graduate medical education slots in 2026. Half of these slots must be dedicated to psychiatry or psychiatry subspecialty residencies. 

“[The Centers for Medicare & Medicaid Services] (CMS) recognizes the cost of unmet social needs hospitals face, as well as the need to advance access to innovative and essential treatments and expand the behavioral health workforce,” Dr. Meena Seshamani, deputy administrator and director of the Center for Medicare, said in a statement. “Our payments to hospitals further recognize this and ultimately help provide hospitals the vital tools they need to better serve all communities.” 

While beneficial, the minimum of 100 additional psychiatrists created by the final rule only scratches the surface of the extent of the psychiatrist shortage.

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While some researchers have estimated that the number of psychiatrists will begin to slowly expand in early 2025, they estimate that the shortage may not be completely resolved by 2050, and may still be short by over 17,000 positions.  

Pay is likely a deterrent to more medical students entering the psychiatry field. A new report published by health care hiring organization AMN Healthcare found that salaries for psychiatrists decreased almost 20% between 2022 and 2023 compared with salaries in 2023 and 2024. 

The increase in the number of nurse practitioners is somewhat mitigating the psychiatrist shortage, according to the AMN Healthcare report.

While the number of psychiatrists treating Medicare patients decreased by 6% from 2011 to 2019, the number of nurse practitioners treating Medicare beneficiaries for psychiatric and mental health conditions grew by 162%.

To maximize the potential impact of nurse practitioners, researchers recommend nurse practitioners be empowered to practice without being required to provide care through regulatory contracts with physicians. 

“To realize the full potential of the growing NP primary care and behavioral health workforce, they must be allowed to practice at the top of their education and license, without artificially imposed scope of practice restrictions,” authors of a study published in Health Affairs wrote.