This is an exclusive BHB+ article
While federal policy shifts dominated 2025 headlines, several quieter stories revealed significant industry transformations happening beneath the surface.
Many stories exposed critical failures in today’s behavioral health system—from TRICARE’s technical glitches disrupting autism care for military families to Ellie Mental Health’s troubled franchise model.
Yet amid these challenges, promising developments emerged: new opportunities to integrate mental health into maternal care and the advancement of innovative reimbursement models, such as population health approaches.
Every year, as editor of Behavioral Health Business, I go through our archives and look for some of the most under-the-radar stories of the year.
In this BHB+ Update, I will explore:
–Why value-based care could be just the start for new reimbursement models
–What investors are now expecting from mental health startups
–The potential opportunity for maternal mental health integration
Disastrous Tech Failures Clobber Autism Therapy Providers in TRICARE West Region
Early last year, BHB’s Chris Larson reported that a technology issue prevented autism providers in the TRICARE West network from checking member eligibility, submitting or checking prior authorizations, or processing claims.
This meant that autism providers caring for military families went weeks without getting paid for services.
In turn, this triggered many autism providers to limit or stop services to TRICARE beneficiaries.
This story was the first story about TRICARE issues, but not the last of the year. In April, we reported that autism providers across the nation were impacted by glitches that impacted the transition of the TRICARE regional contracts at the beginning of the year. In addition to providers in TRIWest, the eastern TRICARE contractor, Humana Military, began to disclose similar administrative problems.
For months at a time, technology systems didn’t work as promised and payments were not made. This story was important because it meant that providers had to make a difficult decision to continue to serve active military families without a solid payment pathway or cut off vulnerable children from services.
Digital Mental Health Startups Face Profitability Pressure as Investor Landscape Shifts
In 2021 and 2022, venture capital investors poured billions of dollars into the behavioral health sector. In many ways, this was a huge positive for behavioral health services, where consumers often faced access issues.
However, with so much competition in the market, investors are now raising their expectations of these digital providers. One of the biggest factors investors are now looking for before providing new backing to startups is profitability.
“[Profitability is] top of mind more than ever,” Faye Sahai, managing partner of Exbourne Group and founding managing general partner at Telosity Ventures, told Behavioral Health Business for the story. “Several years ago, it was really about the interest, the idea, the momentum, the growth. Now we’re in a market that is really looking at your revenue, your unit cost, net profit, how much you plan to grow.”
Redwood City, California-based venture capital firm Telosity invests in pre-seed, Seed, and Series A-stage startups focused on youth mental health and well-being.
Digital behavioral health companies are, in many ways, at a crossroads. Many have reached profitability and are growing their service line. However, others are bleeding capital and looking to reinvent themselves.
This story examines what providers need to do to attract investor interest and stay afloat in a competitive market.
Population Health Management Could Be the Next Frontier for Behavioral Health Reimbursement
We write a lot about the evolution of payment from fee-for-service to value-based care models at BHB. But that may be just the first step for emerging reimbursement models.
Population health management, often called by payers value-based purchasing, could be the next evolution of payment models. This type of reimbursement is aimed at identifying populations with unmet clinical needs and then providing care pathways to accelerate recovery.
Unlike traditional reimbursement models, population health management oversees a cohort of patients at the population level. This could include different geographic populations, employee groups, ethnic groups, people with disabilities, or other defined groups.
This was an important story to tell because we often think of value-based contracting as the one path forward. Yet, value-based care could be just the start for new models of reimbursement.
‘Like Going to the Dentist’: The Business Case for Maternal Mental Health
As integrated care becomes central to behavioral health services, maternal mental health has emerged as a natural opportunity for integration.
There is a major need for services for this population. One in 7 new mothers experiences postpartum depression, according to the Cleveland Clinic.
Still, there are barriers to care. For example, the story outlines that there are a few specialized experts in the space.
“There’s a limited number of reproductive or perinatal psychiatrists with specialized expertise and experience caring for women during pregnancy and postpartum,” Dr. Rachel Dalthorp, executive medical director of specialty services at LifeStance Health (Nasdaq: LFST), told BHB. “Some mental health providers are less familiar with prescribing medications in these periods.”
And while awareness around maternal mental health conditions is growing, there are still places to expand OB involvement and referrals.
“Simplified referral processes and collaborative care models can help reduce delays and improve timely access to mental health care,” Dalthorp said. “Payment models, including bundled payments for perinatal OB care, can make it difficult for OBs to be fairly reimbursed for the time they spend supporting moms’ mental health. Separate physical and behavioral health benefits add complexity for clinicians and patients.”
Better integration of mental health into maternity services could serve as a model for future specialty integrations.
Ellie Mental Health Faces ‘Substantial Doubt’ Regarding Its Survival
Ellie Mental Health has been a pioneer in rolling out a franchise model for behavioral health practices. The BHB team has been closely watching the company because, if successful, it could be a new model for clinicians interested in becoming business owners.
However, this article revealed that the company is now facing a wave of backlash from its franchises, who claimed it misrepresented the requirements and support they would receive. What’s more, several business owners told BHB that this has left them on the edge of financial ruin.
Specifically, some franchisees claim that Ellie’s back-end support services are glitchy and slow, inhibiting revenue generation and collection. Several franchisees are now trying to break away from the parent company and have taken Ellie to court arbitration.
Ellie has, in turn, also taken legal action against the franchisees who have attempted to separate their clinics from the parent company.
While Ellie and the franchise continue to battle in court, public records demonstrate Ellie faces its own host of financial challenges. In August, Ellie updated its franchise disclosure document (FDD), stating that it faces the likelihood of failure.
The story is important because it calls into question the viability of the franchise model in behavioral health.
