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Where we share our weekly news debriefs and discussions with industry experts. These are lo-fi recordings aimed at giving our readers more opportunities to engage with our analysis and a view into some of the conversations that shape it.
Kevin: Alli, uh, chief Research Officer
at Trit, excited to have you here.
Trit, uh, does many of my favorite
reports on healthcare data in the space.
Always love learning from
what you guys put out there.
Recently put out a report on the
behavioral health market, uh, and what
that's looking like and thought it
included a bunch of interesting insights.
So, wanted to start off with is giving
your point of view on state of US
behavioral health market and some of the
key takeaways that you're seeing in the.
Alli: That's a big one.
Well, hi Kevin.
Hi Martin.
Thanks very much for having me.
Um, I guess the saying might go
long time reader, first time caller.
Um, but appreciate you having me on today.
Uh, so yeah, we actually have
the privilege of leveraging, um,
a really vast, um, set of data
to tackle all kinds of different
trends shaping the health economy.
Um, and just a few weeks ago we
released a 80 plus page report that was
focused entirely on behavioral health.
Um, and that's leveraging all kinds
of secondary data, but also a large
national all payer claims database.
Um, also direct data directly from the
health plan, price transparency files,
and then our provider directory too.
Um, and in a lot of our work we use
the lens of supply, demand and yield
to try and understand what's going
on within the healthcare space.
And really the punchline from the
behavioral health report, we're seeing
more demand than ever inadequate supply
that doesn't seem to be catching up
and we're seeing confusing and variable
costs that patients are up against.
Um, so unfortunately it's, it's not
such a great picture, um, from our
point of view at this point in time.
Okay.
Martin: On the demand side of the
equation, can you break us down a
little bit of what's going on with
acuity intensity utilization that's
driving that, that increased demand?
Alli: Yeah, absolutely.
So I think demand within the behavioral
health space is particularly interesting.
It's the case everywhere clinically, but
I think even more so within behavioral
health, where there's always the
question of, okay, is an increase in
utilization reflective of increased need?
Within the clinical area or is it
a matter of need that's always in
in there, but with more access you
could see an increase in utilization.
And then there can always be a little
bit of a piece of the pie too that
could have to do with sort of over
diagnosis or over utilization too.
Um, so when trying to sort of decompose
that increased utilization within the
behavioral health space, I do think a lot
of it has to do with that increased need.
Um, so we heard a lot about this
during the COVID-19 pandemic.
Um, I think being six years out from it,
there were theories that maybe we would
see a reduction in utilization that might
happen or reduction in prevalence, but
that just doesn't seem to be the case.
Um, when doing these sorts of data
analyses, it can be so easy to
really get down into the weeds and
sort of like miss the big picture.
And I have to remind myself taking
a step back, we see 23% of adults
that report any mental illness.
So basically a quarter of our population.
Um, and it's nearly a third in our
18 to 49-year-old working population.
Um, so just like wrapping your head around
that number, I think is pretty staggering.
And from a spending point of view,
um, we do see that about 8% of
personal healthcare spending or total
healthcare spending is on mental health.
But I think the more important
number is actually, um.
What we spend on untreated mental
health, that number is closer
to $500 billion rather than 200
billion on actually treating it.
Um, and that untreated number sort
of encompasses chronic physical
illness, ed overuse, productivity
loss, and premature death.
So I think like primary care, it's one of
those healthcare spaces where we probably
need to be investing more dollars.
Actually
Kevin: interest.
Allie, how do you do the math on, so
if I'm understanding that right, $200
million of, of costs today, 500 million
of potential costs, that's not actually,
um, we're not actually spending today.
How do you do the math on like
quantifying that $500 million number to
know that that's that's what it's at.
Alli: Yeah.
And it's 500 billion with a D.
5 billion.
Billion with a D.
Yeah.
Noticed such large numbers.
We're always dealing.
Yeah, it's crazy dealing
within healthcare.
Um, those particular calculations
we are sourcing from secondary data.
Um, in terms of that
direct medical spending.
Um, it would be care directly
related to, you know, treating,
um, disorders that kind of pop up
within the f section of the ICD 10.
So depression, schizophrenia,
all that sort of stuff.
When people actually go to a
healthcare visit or possibly
the ed, something like that.
Um, when it comes to those untreated
related costs of mental health, um, it's.
Really importantly, the way that mental
health or behavioral health issues
exacerbate physical health conditions.
So I think that's another really important
thing to remember related to all of this.
Like, yes, the report is focused on
behavioral health specifically, but
we know there's this really important
relationship between mental and physical
health and the way that unmanaged mental
or behavioral health issues exacerbate
those physical health problems.
Um, so there's a lot of additional costs
and utilization that goes on there when
one of these conditions are unmanaged.
Um, and then also there's issues
related to where people do receive
care for these conditions too.
Um, so there is some amount of,
you know, if people can't, uh,
access care, you know, through an
outpatient therapist, they might
find themselves in the emergency
department for some sort of flare up.
And we know those visits
are really expensive.
So that sort of like, uh, mis utilization
of the healthcare system goes into
that untreated care bucket too.
Martin: Over on the supply
side, I'm curious to hear
where the gaps are most acute.
Where are we seeing like a real lack
of providers that we need more of
and maybe on a sort of specialty
or subspecialty basis there?
Alli: Yeah, so we certainly know
that the behavioral health provider
space is pretty, um, heterogeneous
in terms of provider types.
So, you know, thinking about primary
care, for example, and many other
specialties at this point too.
You have your physicians and then
you maybe have like an allied health
and PPA workforce that's helping to
supplement at this point in time.
So we see that within behavioral
health too, but there are additional
providers in this space as well.
There's master's levels
clinicians who actually make up
the majority of the workforce.
Um, there's also clinical social
workers who practice in this space.
Um, there's doctorate level psychologists.
Um, there's our MDDO psychiatrists.
Um, and then we're seeing
this more sort of specialized
psychiatric nurse practitioner
workforce, um, start to emerge.
Um, I think something that's really
interesting here, um, in terms of the
potential for sort of artificially
constrained supply and that being a
problem from 2018 to 2024, we do see
that the number of psychiatry residency
positions has actually increased by 55%.
Um, which when we talk about, um,
you know, the a MA residency match
and all of that, there's always
conversation about needing more slots.
So within psychiatry, we actually
see that the number of slots has
increased somewhat significantly, but.
Year over year, those slots
are filled at 99% or so.
So there's sort of demand from the
practitioner point of view, if you will,
to get into this space, but it seems like
we just aren't creating enough positions.
Um, and I think one other interesting
thing we see here, one nationally,
sort of our adequacy rate of mental
health providers is only around 25%.
So we're doing pretty dismally
as it relates to that.
Um, but in terms of how the supply
market is trying to adjust, um, one
thing that we did look at using our own
data was for folks who are receiving
a medication related to mental or
behavioral health, we took a look
at who the prescribing provider was.
Um, and over this period of time we
see that the allied health profession,
um, is actually prescribing the largest
proportion of these medications.
Um, so by 2024, um, we see that, that,
that those allied health providers
since 2018, they were prescribing
around 20% of those medications.
As of 2024, they're
prescribing around 34%.
Um, and together Allied Health and
primary care providers are prescribing
two thirds of all of those medications.
So we can see how sort of a.
Non-specialized mental behavioral
health workforce is having to flex
into helping and meeting the need
of this growing patient population.
Kevin: Allie, it's time for
AI to enter the chat here.
A big topic in the community
is AI care delivery.
What's happening with that?
Certainly, it seems like there
is activity within the ai, mental
health chat bot, et cetera, front.
I'd be curious, are you seeing any
indications data around, is, is AI
helping increase productivity in the
mental health market and projecting out
the next couple of years, like is there
a point at which you think we, we see
more indications of this, learn more
about ai, how AI is impacting the space
and when that shows up in the data?
Alli: That's a great question.
I mean, I think in terms of how AI relates
to mental and behavioral health, we
have to take a step back and think about
the continuum of, okay, what might we
want or ask AI to do within this space.
Um, in general, right?
We think about AI as being a
really good use case for repetitive
sort of administrative tasks.
So where we can create efficiency
for our providers as it relates
to helping to reduce their, reduce
their administrative burden.
Great.
That's a really good application when
it comes to more clinical use cases.
I think that's where there's
still a big question mark.
Um, I think there's been some legal
activity in this space recently that
raises a lot of questions about or sort
of willingness and interest to do this
and the gray areas that it introduces.
Um, certainly something that came
out of the COVID-19 pandemic is
this proliferation of sort of.
Direct to consumer providers
within the behavioral health space.
Um, the extent to which any of
those providers are using ai,
I'm honestly not an expert on.
Um, but as it relates to the direct
to consumer providers and the extent
to which they might start working
AI into their workflow, I do think
there's a question of sort of
fragmentation that it could introduce.
So again, with that sort of mental
behavioral, physical health connection
in these new providers that are popping
up, how do we make sure we're still being
able to provide sort of high quality
holistic care to this patient population?
And then I think there's
a cost question there too.
Um, I think there's an assumption
that AI supplemented care will
inherently be less expensive.
Um, but I think if there's anything we
know to be true with healthcare prices,
it's that they don't usually do what
we would expect a regular market to do.
Um, so I don't think there should be
an assumption that AI will bring down
costs to patients or costs to the system.
Um, and that's actually
something we already see with
the direct to consumer providers.
Um.
So that's something we
unpack in the report.
We sort of take a use case, a patient
who wants to do weekly therapy, if they
pay out of pocket for one of these direct
to consumer providers, versus finding
a traditional provider who's in network
for them and they use their insurance.
The ease of doing that as a whole
separate question, um, but we see the
traditional approach is actually on
average, less expensive for people.
Um, so I think that's a, a combination
of things without totally trying to
get into a crystal ball of what's
gonna happen related to ai, but
some things to pay attention to.
Martin: I think we have time for one more
question, and I was hoping to talk about
another sort of new and novel technology
in behavioral health, though this is more
on the interventional psychiatry front.
Mm-hmm.
So we've seen a lot of, um,
increased venture capital activity
and wider adoption of TMS and
SVA and some of these things.
I'm curious if you're from, you know,
in, in, in the report section, like
what, what are we seeing here from
that perspective going beyond the sort
of traditional first line treatments?
Alli: Yeah, so we just sort of give
a little bit of a lay of the land of
some of these emerging technologies.
So like you mentioned, TMS, um,
things like psilocybin, MDMA, um,
there's definitely sort of this
emerging market I think focused on
treatment resistant issues or sort.
Sort of alternative or novel ways to
be treating some of these conditions.
And I think it's just within the last
couple of weeks we did see that the
Trump administration put out some
sort of announcement about thinking
about funding more research in that
space or coming up with some more
flexibilities as it relates to trying
to approve treatment within that space.
So again, to the extent that behavioral
health is something that's impacting a
quarter of our population, I do think
just that there's a discussion around sort
of novel treatments and new things that
we could be trying and that we're seeing
innovation as a very positive signal.
Um, as with anything though, it's
just a matter of very carefully
implementing or, you know, testing
out these new technologies.
Um, there's also sort of a software
as a treatment element here too, to
consider, um, and what those, what
the pathway for approval for those
sorts of treatment looks like too.
So I do think there is some
exciting sort of new things
coming to the market potentially.
Martin: Allie, this was a great overview.
If folks haven't read the report
yet, where can they find it?
Alli: Um, if they go to our
website, tri health.com.
Um, and on our insights page, they'll
be able to find the behavioral health
report as well as our annual trend
shaping the health economy report.
And then we also put out a weekly
analysis as well that covers
sort of any topic under the sun.
Martin: Very much worth the read.
Allie, thanks so much for
your time today and I hope you
have a great rest of your day.
Kevin: Thanks for joining us, Allie.
Alli: Absolutely.
Thanks Kevin.
Thanks Martin.