With 137 million Americans in provider shortage areas, AI is becoming the first stop for mental health support. Regulators and payers are still deciding how to intervene.
Behavioral healthcare looks very different than it did in 2020.
“So much has changed since the pandemic,” says Alifya Parekh, senior manager of content strategy and impact at HLTH, who is programming the behavioral health circuit at HLTH U.S. this year. “People finally started to wake up to the reality that mental health access needed to be expanded. Employers started investing more. There was improved regulation. Payers started to take notice, too.”
Still, for the one in five U.S. adults who live with a mental illness, only about 50% receive care. Access is the problem, and the space is ripe for innovation.
“It’s a very stark number even with all of these point solutions,” says Parekh, who adds that while there are more behavioral healthcare options on the market, there’s often less clarity about which option is the right one.
For Tori Barnes, who formerly worked as a communications and marketing leader for Headspace, there is more room for improvement. “I still worry about whether we’re connecting the right person to the right care,” she tells HLTH. “Despite increased access, the default remains to route patients into clinical level, even when a lighter-touch option like coaching, group support, or a digital program might actually serve them better.”
Parekh is similarly interested in how new behavioral health pathways can reach people who have never entered through the traditional front door. There could be new avenues to care for lower-acuity cases and triage properly. This is where AI is making a big bet. As AI moves into every corner of healthcare, behavioral health stands out, especially because 137 million people live in areas with a mental health provider shortage.
“Mental health is one of the clearest tests of responsible AI because the stakes couldn't be higher,” Margaret Meagher, chief impact officer of Crisis Text Line, tells HLTH.
The question is now whether AI can open a door for the millions of people who can't seek care and do so in a way that improves long-term outcomes.
Where AI belongs in mental health
As the field evolves, the role of the therapist has come into question, in large part because people are already using AI for mental health advice directly.
In October 2025, OpenAI disclosed that about 1.2 million OpenAI users had conversations related to suicidal planning or intent within a week. In another report, conducted by the American Psychological Association, nearly two in five psychologists reported that their patients had self-diagnosed using AI. And one in five young people who reach out to Crisis Text Line for support found out about it through a chatbot, according to Meagher.
There's active litigation against chatbot companies’ role in consumers’ mental health. While it’s clear that consumer behavior is moving toward embracing human-less emotional support, utilization doesn’t equate to improved outcomes.
“Generative AI chatbots are increasingly used for mental health support, but their safety for managing suicide risk, especially for youth, remains poorly understood,” says Meagher. Most notably, many general purpose chatbots lack built-in escalation pathways for signs of mental distress and self-harm.
Meagher is also bullish on the power of human connection as the bedrock of therapy. “Technology makes the speed and scale of connection possible. People make the connection meaningful,” she says.
Meanwhile, purpose-built companies are trying to pull those same consumers onto platforms designed for care.
AI has already been embedded into clinical workflows at behavioral healthcare companies. Headspace created “Ebb,” an empathetic companion, while Limbic has created a clinical AI Agent that assists in diagnostic decision making. Limbic, which builds clinical AI for intake and treatment, is the first AI-led mental health company selected for FDA's TEMPO pilot. Through it, Limbic is offering Unpacked, a clinician-supervised AI service for Medicare beneficiaries with depression or anxiety, before FDA authorization, as part of CMS's ACCESS model.
“If AI can help people process emotions, build skills, or even just keep up progress between clinical sessions, this frees up clinicians to focus on patients with higher acuity clinical needs,” Barnes says.
The question that remains is how regulation will tackle these new products and how it will all be paid for. It’s clear there is a gray area. For now, many clinicians agree that AI’s support in lower acuity mental healthcare, including in everyday stress alleviation and triage, shows the most promise.
Paying for behavioral healthcare
Medicaid, the single largest payer of behavioral health care, faces roughly $1 trillion in federal cuts over the next decade. As behavioral healthcare continues to transform, it will be important to watch how regulations and the new players challenging incumbents change the payer landscape.
“My big question is when will we reward real integration?” Barnes says. “If payers want to move past fee-for-service and hold companies accountable for quality, they need to pay more to the companies that actually deliver on it.”
Behavioral health remains overwhelmingly fee-for-service, but there are a growing number of outcomes-based contracts.
While payers have focused more on behavioral healthcare since the pandemic, there are still clear gaps, especially for commercial payers. For Jenna Carl, PhD, the chief medical officer of Big Health, condition-specific mental healthcare is a space payers can look at. At Big Health, she’s most focused on building first-line insomnia treatment, starting with Cognitive Behavioral Therapy for Insomnia (CBT-I).
“A digital treatment should be assessed in the right context … against the actual alternatives patients receive today,” Carl says. “The impact potential of this category is enormous. My call to action for payers is simple: lean in. Recognize the value of this category and help shape how it's covered rather than watching from the sidelines. The payers who engage now will be the ones who define it.”
Consumers are embracing AI for their mental healthcare. The challenge will be how companies create outcomes-driven products, and how regulatory bodies and payers decide the gold standard of care.
For more on behavioral health, join us at HLTH USA 2026, where a full-day of behavioral health programming will occur on Sunday, November 15th.
