This is an exclusive BHB+ story.
Last night at my book club, the conversation turned to COVID-era norms that we have so quickly forgotten about in the age of normalcy. One woman remembered being so determined to get a pedicure to soak her very swollen, pregnant feet that she went with a mask, face shield and gloves.
While I don’t think we can ever really say we miss the COVID-era, there was something about that scary time that made us appreciate the mundane. The fresh juice of a strawberry in season, finally bought after queuing for an hour to get into the grocery store. Seeing a friend for a walk outside after months of isolation.
But one COVID-era conversation I certainly do not miss is the workforce shortages. It was a challenging time to be a provider, and yet in the behavioral health sector, the need was at an all-time high. In many cases, clinicians were putting their health on the line to serve their communities, and operators were desperate to fill their slots with qualified staffers.
For years after the pandemic, workforce challenges continued to plague some of the largest providers in the sector. Nearly every earnings call from Universal Health Services (NYSE: UHS) or Acadia (Nasdaq: ACHC) mentioned the need for qualified clinicians.
But then these pressures began to ease, and the workforce question — while always a challenge — started to soften.
However, I’m cautious that new federal policy changes could impact the future workforce, especially for social workers, mental health counselors and therapists.
In this BHB+ Update, I explore:
– How the proposed changes to federal loan programs could impact the behavioral health workforce
– Other funding threats to workforce initiatives
– What does the loss of federal funding for workforce programs mean for operators in the future
Threats to the behavioral health workforce
A new potential challenge for the behavioral health workforce is emerging from the Department of Education. A proposed rule, slated to go into effect in July, will narrow the definition of a professional degree and cap how much graduate students can borrow in federal student loans.
Specifically, social work, several counseling and nursing degrees will no longer qualify as professional degrees, which are allotted a higher borrowing cap. Individuals seeking those degrees will now be limited to a $20,500-per-year loan and capped at $100,000 over a lifetime.
The Department of Education also plans to eliminate the Graduate PLUS loan program, which allows students to borrow up to the total cost of attendance for graduate programs.
Some in the industry say these limits could affect the future of the behavioral health workforce.
”At a time when demand for behavioral health services continues to rise, this rule risks further limiting access to care and weakening the integrated, whole-person care model that patients depend on,” Debbie Witchey, president and CEO of The Association for Behavioral Health and Wellness (ABHW), said in a statement. “The Department of Education’s rule ignores the reality of how behavioral health professionals are trained and licensed in this country.”
The new changes could be a major hit to social workers, who make up the largest percentage of the behavioral health workforce, according to the U.S. Bureau of Labor Statistics.
”That’s a decision to let Americans suffer,” Anthony Estreet, CEO of The National Association of Social Workers (NASW), said in a statement. “Social work is a profession. It requires a graduate degree, supervised clinical hours, and state licensure. When you make it harder for people to afford that education, you don’t just thin out a workforce; you leave real people without care. The veteran who can’t find a counselor. The family is in a rural county with no services.The teenager in crisis with nowhere to turn. We’re in the middle of an opioid epidemic and a mental health crisis, and the Administration’s answer has been to make it harder to become a social worker. You can’t treat this as acceptable. We won’t.”
It’s also important to note that the rule also impacts loans for nurse practitioner degrees. Nurse practitioners are a crucial part of the behavioral health ecosystems – especially when it comes to medication management and prescribing.
To put their role into context, a recent study found that nurse practitioners surpassed psychiatrists in the number of behavioral health medication prescriptions they wrote for Medicare beneficiaries.
If this final proposed rule goes into effect, we could see more barriers to entry for up-and-coming behavioral health professionals.
While changes to loan programs are top of mind, there have been other potential challenges to the behavioral health workforce.
Five states currently have workforce waivers designed to incentivize providers to care for Medicaid patients by reducing paperwork, increasing rates, offering bonuses and providing student repayment programs, according to the Kaiser Family Foundation.
However, efforts like these are likely coming to an end. Last summer, the Centers for Medicare and Medicaid (CMS) sent a letter to states informing them that the agency no longer anticipates approving new 1115 demonstration workforce initiatives. The agency also noted that it does not plan to extend existing waivers for workforce programs, citing the costs.
At the start of the year, the Trump administration also announced plans to terminate $2 billion in Substance Abuse and Mental Health Services Administration (SAMHSA) grants. Part of these grants included student loan forgiveness programs. However, after 24 hours, the administration changed course and decided to keep the grants in place.
The future of the behavioral health workforce
Restricting access to federal loans and cutting incentives for budding behavioral health professionals could take us back to the days when workforce shortages were the top challenge for operators.
As in journalism, a few behavioral health providers choose the profession for the money. Many enter the profession despite the wages, but if there are too many obstacles to financing education, the number could diminish.
And at the end of the day, that could be a loss for those in need of care. Roughly 40% of the nation lives in a mental health professional shortage area, according to the U.S. Bureau of Labor Statistics.
And I could see the restrictions on loan programs disproportionately impacting students from underrepresented communities who lack the funds to cover the difference between the loan amount and tuition costs.
My only caveat with this take is that I don’t think, in a perfect world, behavioral health providers should need to take out more than $100,000 in loans. With such a high demand and modest wages, I would love to see these programs more subsidized.
But for now, I will be closely watching to see what happens with these changes and if operators are facing another COVID-era workforce challenge going forward.