Top challenges for the behavioral health industry in 2020
The behavioral health industry faces many unique challenges and opportunities. Some are similar to other industries, but have unique attributes requiring attention to allow organizations to remain or be sustainable. As we progress further into 2020, below are some of the major challenges to keep in mind that will affect the behavioral health industry now and in the future.
Increased need for services
The primary challenge facing behavioral health organizations is an explosive increase in need for services, particularly in the areas of substance abuse and mental health disorders. The opioid crisis combined with alcohol abuse represent a significant rise in need for services. These issues are often intertwined with underlying mental health disorders. According to the Centers for Disease Control and Prevention (CDC), one in five Americans will experience a mental health illness in a given year with more than 50% being diagnosed with a mental illness or disorder at some point in their lifetime[1]. With more primary care providers moving towards a value-based care model and recognizing a need for mental health services as part of their patients’ treatment, we will continue to see the increasing need for services.
Recruitment and retention of professionals
With the increased need for behavioral health services, a historically low unemployment rate and the exit of the Baby Boomer generation from the workforce, there is a significant lack of qualified professionals. Behavioral health organizations are facing additional recruitment and retention issues due to lack of funding for competitive compensation packages in a high stress field. Knowing more about the current employment situation and gaining a better understanding of various recruitment and retention techniques is critical to addressing the shortage of talent in the behavioral health industry.
Improvement of data analytics and data benchmarking
While understanding metrics has always been important, it is now crucial to truly understand the vast data available and apply it to strategic decision-making. With the vast amount of data consistently being generated, organizations need to leverage their data to understand how to achieve their goals, remain financially sustainable and have the greatest impact on the individuals that they serve. Behavioral health organizations need to make investments now to attain the appropriate data analytics to make informed programmatic and financial decisions.
Diversification of revenues and services
Behavioral health providers are at a crossroads between an increased demand of services and the lack of available funding to support delivery of services. With government funding not growing as fast as desirable, organizations must diversify their income streams in order to remain sustainable. New strategies such as embarking on real estate development projects with available federal or state tax credit incentives, a new type of program/service or additional fundraising efforts from private donors will be necessary to remain competitive and ensure viable financial operations.
Complying with regulations and mitigating risk
Complying with regulatory requirements is a top priority to ensure the individuals served receive the proper levels of services and care, changes in reimbursement requirements are being accurately recorded and reflected in reporting documents, and the data and electronic medical records (EMR) of patients stays protected. Compliance is a constant and evolving endeavor. It is a consistent challenge to ensure people, policies, procedures and monitoring efforts stay compliant.
Industry consolidation
The behavioral health industry has experienced a high level of transaction activity with much of it focused on merging providers for scale or expanding health systems’ service offerings. To keep up with the demand for high-quality services, increase efficiencies and reduce costs, behavioral health organizations continue to explore options while private equity also begins to penetrate in the industry to expand their portfolio. Behavioral health organizations must identify if there are any effective transaction opportunities that may help achieve their goals and how they want to continue their operations.
For more information or to learn how Baker Tilly’s Value Architects™ can assist your organization with your challenges in 2020 and in the future, visit our website at bakertilly.com or contact our team.
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