Mass General Brigham is exploring the idea of building a neurological behavioral health incubator at its McLean Hospital in the western suburbs of Boston.
The incubator would pair growing startups with faculty at the psychiatric hospital, ideally creating a long-term pathway to boost behavioral health capacity and expertise, executives from the Boston-based health system said. The project represents the latest health system-led venture to extend its reach and diversify revenue amid a national surge in behavioral health cases that has exacerbated a long-standing provider shortage and chronic inequities.
“There are significant and demonstrable unmet needs here and the industry is moving in that direction,” said Chris Coburn, chief innovation officer of the largest health system in Massachusetts. “There is an ever-increasing amount of collaboration occurring, whether it’s with another nonprofit, a long-established company or new company, to meet those needs.”
Digital behavioral health funding has skyrocketed over the past decade. Investors plunged $5.1 billion in digital behavioral health companies in 2021, accounting for about 18% of all the investment in digital health, according to Rock Health data. That was up from $35.2 million and a 3% share in 2011, and almost double 2020’s $2.7 billion tally.
Much of that investment stems from innovation arms of health systems, which are used as testing grounds for new technology. Health systems see expanding behavioral health capacity as a high priority, but they must balance that need with the risk of scaling up too quickly.
Some industry observers question whether safely expanding behavioral health startups is feasible amid a national shortage of psychologists and psychiatrists and relatively low reimbursement levels.
“Startups have the inherent adoption problem and there is not necessarily a built-in user base,” said Peter Manoogian, a principal at the consultancy ZS. “We have of course seen many mental health startups grow from a direct-to-consumer perspective, and those have run into some challenges very recently.”