U.S. Behavioral Health Market Size, Share & COVID-19 Impact Analysis, By Type (Behavioral & Mental Health, Substance Abuse, Eating Disorders, Trauma/PTSD, and Others), By Payor (Public Health Insurance, Private Health Insurance, and Out-of-Pocket), and Country Forecast, 2023-2030

The U.S. behavioral health market size was valued at USD 79.99 billion in 2022. The market is projected to grow from USD 83.70 billion in 2023 to USD 115.21 billion by 2030, exhibiting a CAGR of 4.7% during the forecast period.

Behavioral health services are focused on daily habits, behavior, and actions of an individual, which can impact the mental health of a patient. Physical & mental health disorders, such as mental illness, anxiety, depression, substance use disorders, and eating disorders, are the primary reasons for distress and disability among the population in the country. The rising demand for treating these disorders is set to augment the market size over the coming years.

• For instance, according to the Centers for Disease Control and Prevention 2022 data, the percentage of adults receiving treatment for mental health increased from 19.2% in 2019 to 21.6% in 2021.

The U.S. market is expected to grow at a substantial pace during the forecast period. This is due to the implementation of favorable policies on both the federal and state level and a shift in the trend of the adoption of telehealth-based treatments for the disorders.

• For example, according to the KAISER FAMILY FOUNDATION in 2021, 58% of mental health or substance abuse patients use out-patients visits out of which 62% visits were performed via telehealth.

COVID-19 IMPACT

Availability of Digital Care Services Boosted the Market Growth during the Pandemic

The COVID-19 pandemic influenced the dynamics of the healthcare sector globally. During the pandemic period, behavioral healthcare services emerged as both challenging and as an opportunity across the globe. The pandemic elevated the need for these services due to the increasing prevalence of depression, anxiety, and stress among the U.S. population. The pandemic also disrupted the supply of medicines, medical devices, and others, leading to the adoption of virtual care services by therapists and patients among the U.S. population. The pandemic led to the increasing adoption of virtual care services for behavioral therapies such as depression, mental illness, and others. In-person, outpatient visits to healthcare services drastically declined due to the lockdown restrictions. Therefore, a shift toward digital care services was witnessed among the patients and healthcare providers during the pandemic.

• According to the Commonwealth Fund, there was a 56% increase in the use of telemedicine for specialties such as behavioral health in December 2020 as compared to March 2020.


• Before the COVID-19 pandemic, virtual visits accounted for only 1% of all the visits for behavioral and mental health conditions which could be conducted virtually. However, post the pandemic, based on various factors, these grew to around 25% of all visits that could be conducted virtually, as it was deemed more convenient to some patients.

In 2021, the market witnessed substantial growth as restrictions related to the pandemic were lifted and healthcare activities resumed to their normal pace. The increased prevalence of mental illness and behavioral disorders among the U.S. population lead to the increased adoption of these services in the country. Major players also witnessed a growth in their revenue from the behavioral health segment due to the increased demand for such services.

• For example, Acadia Healthcare witnessed a growth of 10.7% in their revenues generated from their behavioral health segment in 2021 compared to previous year by developing new services within their existing locations along with expanding to new locations.

LATEST TRENDS

Transition toward Advanced Digital Tools due to their Increasing Advantages and Applications

The U.S. is witnessing a significant shift of customers toward digital tools. Factors such as cost reduction, easy access, and improved patient monitoring are a few of the factors causing the shift in their preferences. major players and new entrants in the market to focus toward introducing advanced and innovative digital tools to cater to patients requiring mental health treatments in the U.S., fueling the market growth.

• For instance, in August 2021, Ginger announced a collaboration with Headspace in order to meet the escalating demand for mental health support. The agreement would allow both the companies to provide the world’s most accessible and comprehensive digital mental health and wellbeing platform to the patients suffering from mental disorders.

Furthermore, initiatives taken by employers to promote mental health awareness in their organization drive major players to launch new products catering to the demand and contributing to the market growth.

• For example, in April 2022, Talkspace, Inc. announced the launch of Talkspace Self-Guided, a suite of offerings for employers designed to help executives, managers, and teams to build emotional intelligence and mental intelligence in and out of the workspace.

These applications track passive symptoms by collecting data using sensors. These sensors recognize differences in the behavior pattern, which can signal episodes including depression and psychosis. Such factors have increased preference among individuals to use digital tools, resulting in the growing demand for behavioral therapies in the U.S.

DRIVING FACTORS

Increasing Prevalence of Mental Disorders to Aid the Market Growth

Over the years, an increasing number of trauma, substance abuse, and poor nutrition cases have resulted in depression, anxiety, and eating disorders. This has led to an increase in the number of people suffering from functional impairment such as managing assignments and prioritizing tasks. Thus, the rising prevalence of mental illness in the country leads to an increased demand for treatment services.

• For instance, in 2021, the National Alliance on Mental Illness stated that 22.8% of U.S. adults experienced mental illness in 2021 and about 5.5% of adults experienced serious mental illness compared to 5.2% in 2019.

Furthermore, an increase in the number of patients suffering from mental illnesses, such as anxiety, depression, and Post-Traumatic Stress Disorder (PTSD), is leading to the growing cases of substance abuse, which is considered as one of the major behavioral disorders. 

• In September 2022, according to the U.S. Department for Veteran Affairs, people suffering from PTSD started using alcohol and other mood-enhancing drugs, increasing their endorphin levels and leading to substance abuse.

The increasing prevalence of mental illness and substance abuse disorder has led to the rise in demand for these services in the country, propelling the growth of the market.

Improved Access to Healthcare to Foster the Market Growth

The rising adoption of digital technologies improved the healthcare services accessibility among individuals in the country. Additionally, integration of virtual reality tools and telehealth raised the adoption of speech and language therapy services as they make the service less time consuming and also provide solution across different geographies.

• For instance, in August 2022, Brave Health, a virtual behavioral health provider partnered with MedArrive, a company developing mobile-integrated care management platforms to integrate its services into home visits for the most vulnerable Medicaid population.

Integration of artificial intelligence and smartphone assisted therapies including AI-chatbots, such as Wysa (Touchkin eServices Private Limited) and Woebot (Woebot Labs, Inc.), assist patients to practice cognitive-behavioral therapy helping them analyze their condition through these tools. The seamless interaction provided by these apps helps create a positive therapeutic experience for the user.

Advantages associated with the digital tools have led to an increase in the adoption of these services among the U.S. population. This has driven a few emerging and existing companies to focus on R&D initiatives in order to launch artificial intelligence (AI) integrated digital tools for the assistance of behavioral therapies in the U.S., making them accessible to every individual in the country.

RESTRAINING FACTORS

Lack of Mental Health Professionals and High Cost of Treatment to Hinder Market Growth 

One of the key factors affecting the market is the lack of availability of behavioral health services caused by the combination of high demand for treatment and low supply of trained professionals. Increasing population and the growing need for mental health services especially after the pandemic are contributing to the shortage.

• For instance, according to a report by GoodTherapy, LLC., the U.S. has an average of 30.0 psychologists per 100,000 people and 15.6 psychiatrists per 100,000 people.

In rural areas of the country, shortages are more likely to occur due to the lack of funding and infrastructure. Therefore, lack of professionals to cater to the growing demand hinders the U.S. behavioral health market growth.

Another factor restraining the market growth is the high cost of treatment. Although the Affordable Care Act requires medical insurers to cover behavioral and mental healthcare, the cost of treatment still limits the access to mental health services. In the U.S., lack of financial resources prevents many individuals to seek professional help or may receive inadequate treatment.

• For instance, in the U.S., patients suffering from major depression have to spend an average of USD 10,836 a year on treatment.

Such factors along with limited awareness and availability of mental health education may restrict the growth of the market during the forecast period.

SEGMENTATION

By Type Analysis

Rising Patient Count for Mental Illness to Drive the Behavioral & Mental Health Segment Growth

Based on type, the market is segmented into behavioral & mental health, substance abuse, eating disorders, trauma/PTSD, and others. The behavioral & mental health segment dominates the market due to the rising cases of depression and anxiety disorders among the U.S. population. This has led to an increase in in-patient admissions and outpatient visits in hospitals seeking behavioral and mental health services which positively contributes toward the segment growth.

• For instance, according to statistics published by Mental Health America, Inc., in 2022, nearly 50 million Americans suffered from mental illness, which represents 19.86% of adults in the U.S.

This is presenting a large patient pool requiring treatment in the country. This along with increasing awareness regarding available treatment and management options and expansion of these services by market players in the country will drive the growth of the segment during the forecast period.

The substance abuse segment is projected to register a comparatively moderate CAGR over the forecast period. The growth of the segment can be attributed to the rising number of illicit drug users in the country leading to strong demand for treatment among patients suffering from substance abuse disorders.

• For instance, according to the National Survey on Drug Use and Health (NSDUH) 2021 report, an estimated 61.2 million (21.9% of the population aged 12 years or above) used illicit drugs. Out of these, around 46.3 million people met the criteria for having substance use disorder comprising 24.0 million with drug use disorder and 29.5 million with alcohol use disorder.

Therefore, above mentioned factors, along with stress and emotional distress causing individuals to consume alcohol and substances such as drugs as a coping mechanism, also majorly contribute toward the growth of the segment.

By Payor Analysis

Significant Surge in Adoption of Public Health Insurance to Drive the Segmental  Dominance

Based on payor, the market can be segmented into public health insurance, private health insurance,  and out-of-pocket.

The public health insurance segment accounted for the largest share in the market in 2022. This is due to the increasing demand for behavioral therapies, which leads to high uptake of insurance under Medicare and Medicaid.

• For instance, in 2021, Medicaid accounted for 49.6% of the revenue generated by Acadia Healthcare.

The private health insurance segment held a substantial share in the market in 2022. Strategic initiatives undertaken by insurers such as launching integrated care management and outreach programs significantly contribute toward the segment growth.

• For instance, in March 2021, Anthem Insurance Companies, Inc. through its student advantage health plans entered into an exclusive partnership with Christie Campus Health. The partnership would help colleges and universities to address escalated rates of anxiety and depression reported on campuses throughout the country.

Hence, the aforementioned factors combined with partnerships with hospitals are set to fuel the segment growth over the forecast period.

KEY INDUSTRY PLAYERS

Expansion of Related Health Facilities across the U.S. to Lead to Intense Competition among Industry Players

The U.S. behavioral health market share is fragmented with a large number of companies providing substance abuse and eating disorders services. Among key players, Universal Health Services represents a significant share in the market owing to its expanded presence across states with several facilities.

• For instance, in June 2022, Universal Health Services, Inc. signed the letter of intent intending to expand the inpatient services.

Acadia Healthcare is also recognized as one of the leading providers for behavioral healthcare services as it currently has 227 facilities, including primary care, emergency departments, and outpatient facilities across 40 states in the U.S. The incorporation of telehealth technology by these companies and their focus on acquisitions and partnerships to provide services to a large number of the population is anticipated to raise the potential of the U.S. market over the forecast period.

Other players, including BHG Holdings, LLC. and American Addiction Centers and Uprise Health are focusing toward expanding their presence in the U.S. market by expanding their facilities and introducing services in the country.

• For instance, in October 2021, IBH rebranded to Uprise Health and expanded its mental health and wellbeing offerings to address burgeoning mental health needs.

LIST OF KEY COMPANIES PROFILED:

• Universal Health Services, Inc. (U.S.)


• BHG Holdings, LLC. (U.S.)


• Acadia Healthcare (U.S.)


• American Addiction Centers (U.S.)


• CuraLinc Healthcare (U.S.)


• BEHAVIORAL HEALTH SYSTEMS, INC. (U.S.)


• North Range Behavioral Health (U.S.)


• Uprise Health (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• February 2023: United Health Services, Inc. and Lehigh Valley Health Network, in a joint venture, planned to construct a new behavioral health hospital to address the growing services demand of.


• June 2022: Universal Health Services, Inc. and Trinity Health Michigan, in collaboration established an inpatient behavioral health hospital to improve patient access to behavioural health care.


• June 2022: Acadia Healthcare formed a joint venture with Tufts Medicine to build a new 144-bed hospital with an aim to expand access to critically needed inpatient behavioral health services.


• January 2022: Acadia Healthcare announced the acquisition of CenterPointe Behavioral Health System with an aim to extend its footprint in high growth markets.


• March 2021: Acadia Healthcare announced a partnership with Lutheran Health Network of Indiana LLC to focus on building hospitals for mental disorder services.

REPORT COVERAGE

The market research report provides a detailed analysis of the industry. It focuses on key aspects such as regulatory and reimbursement scenario in the U.S., statistics related to mental health, opioid addiction, adoption of telehealth technology, key industry developments, such as mergers, acquisitions, and partnerships, and the impact of COVID-19 on the market. Besides this, the report also offers insights into the market trends and highlights key industry dynamics. In addition to the aforementioned factors, it encompasses several factors that have contributed to the growth of the market in recent years.

Report Scope & Segmentation 

ATTRIBUTE	DETAILS
Study Period	2019-2030
Base Year	2022
Estimated Year	2023
Forecast Period	2023-2030
Historical Period	2019-2021
Growth Rate	CAGR of 4.7% from 2023-2030
Unit	Value (USD Billion)
Segmentation	By Type and Payor
By Type	Behavioral & Mental Health Substance Abuse Eating Disorders Trauma/PTSD Others
By Payor	Public Health Insurance Private Health Insurance Out-of-Pocket