Many of y’all know that I have been using TherapyNotes as our practice EHR for over 10 years now. I’ve looked at the others and I keep coming back to TherapyNotes because they do it all. If you’re interested in an EHR for your practice, you can get two free months of TherapyNotes by going to thetestingpsychologist.com/therapynotes and enter the code “testing”.
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Hey folks, welcome back to The Testing Psychologist podcast. Today is a [00:01:00] business episode; the second episode in an annual series that I started last year. It’s called Business Topics I’m Thinking About for the following year. I really enjoyed putting together this episode last year for topics that I was thinking about in 2024 and so I am going to chat a little bit about business topics I’m thinking about for 2025, because part of my job as the visionary for our practice is to dive deep into trends that could influence our practice and generate ideas for improvement and generally keep my finger on the pulse of the industry, so to speak. So I’ll be sharing some things that I’ll be thinking about for 2025.
It’s interesting to reflect back and see that there’s a fair amount of overlap between last year’s episode and this year’s episode which maybe speaks to the idea that things don’t develop as quickly as I would think and trends tend to extend on a longer timeframe but we [00:02:00] will see how these things play out.
Now, not all of the ideas directly impact our practice, of course, but I think it’s valuable to brainstorm and identify potential areas to be working on and thinking about over the next 6 to 12 months, as we continue to try to run the best practices that we can.
Speaking of which, I promise I didn’t plan that transition, but this is the time of the year when my mastermind cohorts start up again. So in January 2025, there will be cohorts for beginner, intermediate, and advanced practice owners with testing as the main focus of the practice. These are group coaching experiences where you can expect support and accountability to work on your practice and do the best that you can and make it the best that it can be. So if that’s interesting to you, you can get more info at thetestingpsychologist.com/consulting.
All right y’all, let’s talk a little bit about trends [00:03:00] for 2025.
Okay, everybody, here we are talking about business trends in the mental health and neuropsychology industry for 2025. I’m going to jump right into it without further ado.
Topic 1. Now, these are in no particular order in terms of importance or urgency or anything like that. So you can sort through these and decide for yourself what feels most important, but I’ll start at the top, increased testing fees. This was an item from the list last year as well and here we are again. I think that most of us have probably gotten those emails from the test publishers talking about raising rates again in 2025.
This is not a popular stance, [00:04:00] but I’m going to try to split the difference here and see both sides. We talk all the time about raising our own rates to match inflation and standard of living and so forth. I get it from a business standpoint that these companies are doing what they have to do to cover the costs for employees and other expenses in their businesses. That said, it’s really unfortunate that we are the ones that bear the brunt of that.
I’m not enough of an economist to know if this is how things should work but it seems like this is how things go. Businesses and other goods producers raise the cost of their services or goods to cover expenses, and then we just pass that expense along to our clients in the form of raising our rates, and [00:05:00] then there’s pressure on businesses to raise wages to cover the cost of goods and services. I don’t know what the right solution is but it seems like this is how it goes. If anybody out there is an economist or can tell me how this should work, please reach out. But this is the reality. Testing publisher companies are raising their fees for testing materials.
Last year, we implemented a testing materials fee to offset some of the cost of the rising materials cost. Some people can do this. Some people can’t. I certainly advise checking with all of your insurance panels if you’re an insurance-based practice, which we are. I had to check with the panels to make sure that these fees are legal under our insurance contracts. Some of them said no. Some of them said yes. So we are charging materials fees for the [00:06:00] panels where it’s acceptable and we rolled the materials fee into our private pay rate for clients who are private pay. So if you’re a private pay practice, I think it’s definitely worth raising your fees at least enough to cover testing materials.
I may have mentioned on the episode last year or on other episodes that the cost of testing materials is now somewhere in the neighborhood of $100 to 150 $per comprehensive pediatric evaluation. For adults, it’s a little bit less, but not much. That’s a substantial expense.
One thing that I actually found effective was with our insurance panels, bringing this to their attention and using that as a negotiating point for increasing reimbursement rates, it actually did work in the case of one panel. So you may be able to document these increasing materials fees, take that to panels, [00:07:00] and use that to justify a raise in rates. Lots to think about here, but the reality again is that testing materials fees are going up and insurance reimbursement is generally not keeping pace. So I think it’s up to us to take these fees and these costs to the insurance panels and try to make an argument to raise our rates. Private pay practices will certainly have an advantage because you can just raise your rates to cover the materials cost as you would like. Either way, consider a testing materials fee and check it out to see if that is an acceptable way to cover some of these costs.
Now, the next topic is AI, of course. AI is continuing to grow. I actually had some thoughts and have heard on various business podcasts that the AI boom might be plateauing a little bit. I don’t think that’s necessarily [00:08:00] true. I did some research in preparation for this episode and the projections say that the AI market share is going to quadruple or quintuple within the next 5 to 6 years. It doesn’t seem like there’s any indication that AI is slowing down.
I think the initial rush to AI and that initial round of every business incorporating AI in some form or fashion, like just getting some basic implementation out there, has died down and now we are maybe in the one-and-a-half or second phase of AI implementation where the tools are getting more sophisticated. It’s going beyond chatbots or wrappers around chatGPT and that kind of thing. So if you’re not using AI in some form or fashion, I would say, prepare to get left behind essentially. [00:09:00] You have to at least have some understanding of AI, how it’s being utilized, where it’s showing up in the different industries.
I think about it in terms of direct and indirect effects. And so let’s say you’re not ready to implement AI in your clinical work, which is fine, lots of feelings around that and fears, I think, and some resistance. So let’s say you don’t want to use it in your clinical work. You still might want to leverage it for scheduling tools, writing emails, or using it in Canva to generate images or graphics.
It’s just getting implemented everywhere. I think relatively soon, we’re going to see some major differences emerge between folks or businesses who are successfully utilizing AI and those who aren’t. [00:10:00] I’m going to take a maybe radical position and say it’s going to be a car versus horse-drawn carriage situation sooner than we think as AI frees up our brain power to do the most important parts of our work instead of spending time on the minutia.
What does this actually mean?
There’s AI solutions in almost every software that you’re using. A lot of our EHRs are starting to build in AI, especially for therapy note summaries and things like that. If you’re not doing therapy, that’s fine. Google Workspace has AI built in to summarize emails and generate documents. Microsoft, of course, has Co-pilot who is their major investor in open AI, which is the parent company of chat GPT. So it’s integrated in pretty much everywhere. And like [00:11:00] I said, I see AI as a tool and not as a threat. And if you are not willing to learn how to utilize AI in some form in your business, you’re probably going to get left behind as other folks do.
Like I said, I think the cool thing about AI is that it frees up our brainpower to do the more important parts of our work so that we don’t have to focus on little details and mundane work. In the context of evaluations, that means you can leverage some AI solutions to write your background and history, generate your tables, or write those parts of the report that are a little more scripted or templated so that you can focus your brain power where I think we should be spending our time, which is the conceptualization or summary and writing really good recommendations. You can even use AI to help with that.
[00:12:00] Full disclosure, I’m a co-founder of an AI-driven report-writing program. It’s called Reverb for those of you who have not heard of it. But there are many other ideas or software solutions out there. So even experimenting with various large language models or using something like Bastion can give you a leg up.In conclusion, AI is going to continue to grow. I think it’s really up to all of us to learn how to use it. I don’t think AI is going to take our jobs, but I think folks who know how to use AI are going to slowly grab more business than folks who don’t know how to use AI simply because they’ll have more time and brainpower at their disposal.
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All right, the next topic is, I’m calling it reality sets in as far as practice ownership post-COVID. I talked about this a little bit last year, but I think we’re continuing to come off of the COVID boom. COVID was huge for a lot of mental health practice owners. Practices grew very [00:15:00] rapidly. Group practices got bigger and bigger. Hiring was relatively easy. The referrals were like a fire hose for most practices. We couldn’t hire people fast enough to meet the demand and even solo practitioners felt more confident to take the leap from agencies and so forth.
But in the last year, I think things have changed. Some insurance panels are maintaining or expanding telehealth access, but others are reducing reimbursement for telehealth. So we’re starting to see some of that demand go away. On the venture capital side, I’m definitely seeing venture capital lose interest in telehealth-only practices. Folks seem to really value in-person work more and more. So if you’re in that phase where you’re thinking about selling your practice or building something to sell, just know, it seems like the VC money [00:16:00] is drying up a little bit for telehealth-only.
What else are we noticing in this area?
Referrals are slowing down for many people as we, I think there are many factors with that. We went through a period of inflation, that’s largely come down, but we did go through that period and potential clients are watching their budgets a little more closely. I noticed it started probably around this time last year, maybe September 2023, people started to talk more about I’m not getting as many referrals as I used to. I am paying for advertising for the first time in forever. So, like I said, referrals are slowing down a bit and we’re coming back to a little bit of equilibrium, I think following the post-COVID boom.
Now, within the last several months, I’ve also noticed a lot of group practice owners becoming disillusioned with practice ownership and either shutting down [00:17:00] entirely, enduring practice ownership with slim profit margins and frequent people problems that seem somewhat intractable or see going back to solo practice. This is a common theme in the Facebook groups, listservs, and circles that I’m in as far as group practice owners. And this applies to folks who are relatively small and relatively large.
I think a lot of group practices grew pretty quickly and did seem to do well at least through COVID and for the years after, but now it’s coming back full circle where the ones who are surviving and actually thriving are the group practice owners who’ve put in the work to become good leaders, have a great handle on finances, and are willing to actually make those hard decisions around running a business versus [00:18:00] supporting employees and paying them relatively high rates and things like that. I think this is more of an issue with therapy-centric practices because groups like Alma, Headway, and so forth are providing a lot of competition for those groups.
So what do you do about this? If you’re a thriving group and you love what you’re doing, now might be the time to look to acquire those smaller practices that are on the verge of shutting down or even some of the larger practices that are on the verge of shutting down. There are also a lot of folks who are “aging out of practice” as the baby boomer generation gets older and those folks might want to sell and maintain a legacy. If you’re a growing practice, there’s a great opportunity, I think, to look for some of those practices.
Now, if you are not happy or otherwise struggling as a practice owner, you are not alone. I personally made a huge shift early in [00:19:00] 2024 to scale our practice down. I talked about that in a podcast several episodes ago. So don’t think that you have to endure it just because you’ve sunk a few years and a lot of money into your practice. Get real with yourself about options for increasing the joy in your practice and in your life, right? Life is short.
Otherwise, in this realm, I’m thinking about continuing to nurture my team, both clinically and personally. And if you’re a group practice owner, I think your job is making sure your team is totally on point. You cannot ignore your people. This is one of the advantages that we offer over solo practices; the collaboration, the team environment, the support, and all the things that come with being a group.
All right. What else? Next topic? Master’s level testing. This is interesting. I think this is an emerging trend. There’s a lot of [00:20:00] discussion around this in the last few months as APA is considering master’s level licensure for psychologists.
I don’t know what to say about this other than having a lot of mixed feelings. On one hand, I think we do have a shortage of neuropsychologists or testing folks, on the other, I absolutely do not want to dilute the practice of assessment. I imagine that this is probably a similar dynamic that happened for psychiatrists when psychologists and others started doing therapy or, as it stands now, prescribing medication. I know that there are many masters level folks out there who can develop the expertise just like all of us with the time and the training to do so, but I’m curious how that will play out in real life, and if we’re going to find that there are programs out there that offer shortcuts or subpar training and assessment.
So what do you do? If you’re concerned about masters’ level folks taking your job, I would encourage you to spend that energy into [00:21:00] honing your own expertise, figuring out how to stand out from the crowd, and figuring out how to market yourself or your practice. Spoiler, the general public is not going to know or care about qualifications when they’re looking for someone to do testing. If there’s a master’s level person out there with a great website, great copy, and willingness to present themselves confidently, the general public is not going to know that they need a psychologist or maybe even want a psychologist. So, rather than complain about it, I think we’re going to need to spend our energy, like I said, figuring out how to stand out, communicate your expertise, and distinguish yourself from the crowd.
If history is any indication though, it’s very unlikely that we’ll reach a point of true saturation in the market. I think there are enough clients for everyone if you’re doing good work and being a good person. Building relationships in your community, like I said, doing good work, [00:22:00] and focusing on presenting yourself in a way that’s attractive to potential clients.
The last thing that I want to talk about is the trend of being in person again. This is another post-COVID trend, but worth highlighting, I think. And this cropped up for me around two personal experiences. Over the last two years, I have hosted this Crafted Practice event, which is a business retreat for testing psychologists. The past two summers, I’ve done this event and people are enjoying the connection and energy that comes from being in person again, at least in my data point of one.
But then I also saw this when I attended the NAN conference in November, just a few weeks ago. This is the first neuropsychological conference that I’ve attended in person in years and it was so much better than sitting on a computer [00:23:00] all day watching virtual presentations. I recognize there’s some personal preference at play here. Some people would prefer virtual, and some people want to be in person, but just for me, I think we are built for relationships and connecting with people, being around people. There’s a collective energy that’s so much greater than the sum of the parts. The data would say this as well. Trends are pointing in the direction of saying that the vast majority of people prefer in-person events.
There is still a market for virtual events, but in-person events are making a resurgence, and like I said, the research is certainly saying that people prefer in-person events, but the good news is that you will likely have your pick. Lots of events are doing a hot bird model where you can come in person if you would like, or you can attend virtually as well. So you might be able to choose [00:24:00] which option you would prefer.
All right, folks. These are just a few topics, like I said, that I’m going to be thinking about for 2025. I did not get into different service lines and things like that, that you might offer in your practice. Last year, I talked about coaching, financial therapy, and sober curious therapy things like that. That stuff just isn’t top of mind for me these days because we are not offering therapeutic services in our practice anymore, we’re solely testing-focused at this point, but I hope that some of these topics stood out to you.
I’m really curious, if you’re thinking about anything in particular, if there are other trends that you’re seeing, make some comments on this post or shoot me an email, at jeremy@thetestingpsychologist.com. Perhaps it can turn into another podcast conversation.
I wish all of you well and I’m looking forward to what [00:25:00] 2025 brings.
All right, y’all. Thank you so much for tuning into this episode. Always grateful to have you here. I hope that you take away some information that you can implement in your practice and in your life. Any resources that we mentioned during the episode will be listed in the show notes, so make sure to check those out.
If you like what you hear on the podcast, I would be so grateful if you left a review on iTunes or Spotify or wherever you listen to your podcasts.
If you’re a practice owner or aspiring practice owner, I’d invite you to check out The Testing Psychologist mastermind groups. I have mastermind groups at every stage of practice development, beginner, intermediate, and advanced. We have homework, we have accountability, we have support, we have resources. These groups are amazing. We do a lot of work and a lot of connecting. If that sounds interesting to you, you can check out the details at thetestingpsychologist.com/consulting. You can sign [00:26:00] up for a pre-group phone call and we will chat and figure out if a group could be a good fit for you. Thanks so much.
The information contained in this podcast and on The Testing Psychologist website is intended for informational and educational purposes only. Nothing in this podcast or on the website is intended to be a substitute for professional, psychological, psychiatric, or medical advice, diagnosis, or treatment. Please note that no doctor-patient relationship is formed here, and similarly, no supervisory or consultative relationship is formed between the host or guests of this podcast and listeners of this podcast. [00:27:00] If you need the qualified advice of any mental health practitioner or medical provider, please seek one in your area. Similarly, if you need supervision on clinical matters, please find a supervisor with expertise that fits your needs.