Small US mental health practices face 2025 fee cuts, complex rules and rising denials. Learn practical, billing-focused strategies to protect your revenue with help from Delon Health.

On a rainy Tuesday in February, Dr. Martinez; solo psychiatrist, full panel, three-month waitlist, sat in front of her EHR dashboard and felt something that didn’t match the calendar. 

On paper, she was busy and successful. Every slot was booked. Her group telehealth sessions were full. She’d added a part-time therapist to keep up with demand. But when her accountant walked her through the numbers, the picture was ugly: year-over-year revenue was flat, overhead had crept up, and her net income had quietly dropped, even as burnout crept higher. 

She wasn’t seeing fewer patients. She was getting paid less, and getting paid later. Add in 2025 Medicare Physician Fee Schedule cuts, constantly shifting telehealth rules, the No Surprises Act paperwork burden, and complicated mental health parity enforcement, and the problem became clear: the clinical side of her practice was thriving, but the revenue cycle hadn’t kept up. 

If you run a small US mental health practice; solo therapist, small psychiatry group, counseling or behavioral health clinic, you’re probably living a version of this story. You’re needed more than ever. But your revenue is under pressure from every side: 

Lower reimbursement and fee schedule changes 

Tougher prior auth and documentation standards 

Denials tied to telehealth, parity and the No Surprises Act 

Patient cost sensitivity and growing bad debt 

This article walks through what’s changing in 2025 and, more importantly, what you can actually do about it as a small mental health or behavioral health practice. We’ll connect policy changes to real-world billing, show you how to tighten your behavioral health revenue cycle management (RCM), and explain where a specialist partner like Delon Health fits in. 

The 2025 Revenue Landscape 

Demand for mental health services is not the problem. Multiple reviews show a sustained global surge in anxiety, depression and stress-related conditions, with digital mental health tools moving from novelty to mainstream. Telehealth use for behavioral health remains 2–5x above pre-pandemic levels, and hybrid care (mixing in-person and virtual) is now the norm for many practices. 

Yet in 2025, US small practices are being squeezed by: 

Medicare cuts and shifting codes. CMS’s 2025 Medicare Physician Fee Schedule final rule reduces overall payment rates under the fee schedule by about 2.93% compared to most of 2024, though some time-based behavioral health codes and integration services see targeted improvements. 

Telehealth complexity. Behavioral health telehealth flexibilities (including audio-only visits and home as the originating site) are now permanent for Medicare, but non-behavioral telehealth flexibilities only extend through September 30, 2025. Practices must distinguish behavioral visits correctly and bill them with the right place of service (POS) and modifiers. 

Regulatory cross-pressure. The No Surprises Act (NSA), ongoing fights over mental health parity rules, and stricter documentation expectations all show up as more administrative work and more ways to get claims denied if the details aren’t right. 

At the same time, revenue cycle experts are clear: the practices that thrive are the ones that treat RCM as a discipline, not an afterthought. The AMA’s guide to revenue cycle management, and recent behavioral-health specific RCM articles, all stress the same point: track the full financial journey from scheduling to final payment, monitor denials, and keep your clean claims rate high. This is not the year to wing it with billing. It’s the year to clean up the leaks. 

 Friends and Frenemies for Behavioral Health 

If you see Medicare patients or follow commercial payers that shadow CMS policy, this year brings both good news and headaches. 

The CMS 2025 Physician Fee Schedule and educational summary documents highlight several trends that matter for mental health providers: 

Across the board, the conversion factor drops, putting downward pressure on many professional fees. 

Timed behavioral health services saw improved valuations in recent years, and CMS has continued to refine codes for Behavioral Health Integration (BHI) and Collaborative Care Model (CoCM) services, creating new revenue streams for practices that can operationalize them. 

Telehealth policies make behavioral/mental telehealth flexibilities permanent: patients can receive services from home, without geographic restrictions, and audio-only visits are allowed under specific conditions. 

The HHS Telehealth Policy Updates page makes the distinction very clear: for behavioral/mental health, telehealth to the patient’s home with no geographic limits and audio-only is permanent; for non-behavioral services, many flexibilities expire at the end of September 2025 unless Congress acts. 

For a small therapy or psychiatry practice, this translates into real money questions: 

Are you correctly using POS 10 vs POS 02 and modifiers (often 95) for mental health telehealth visits? 

Are your clinicians documenting telehealth visits in ways that support time-based coding and medical necessity? 

Are you capturing BHI/CoCM opportunities with primary-care partners, and billing codes like 99484, 99492–99494, G2214 when appropriate? 

Top Billing Challenges for Mental Health Providers in the U.S. (and How DelonHealth Solves Them) walks through exactly these pitfalls: wrong telehealth modifiers, underuse of integration codes, and missed caregiver training codes that directly cost practices money. 

Telehealth is absolutely a revenue lifeline for mental health, if you match your coding and documentation to 2025 rules, otherwise, it is a quiet denial engine. 

No Surprises Act: Out-of-Network Protection, In-Office Consequences 

Many small mental health practices still think of the No Surprises Act (NSA) as an ER and hospital law,” but parts of it absolutely touch behavioral health. 

The NSA’s implementing rules, outlined on the federal No Surprises Act overview page, create two important obligations for many mental health practices: 

Good Faith Estimates (GFEs) for uninsured or self-pay patients, including psychotherapy and psychiatry visits. 

Access to Independent Dispute Resolution (IDR) for certain out-of-network claims when negotiations with payers fail. 

Research shows the Act has reduced out-of-pocket costs for many patients protected by its surprise-billing provisions, which is good for patients but puts pressure on some out-of-network revenue strategies. At the same time, regulators and analysts highlight how the IDR process has become expensive and administratively heavy, with significant costs for both insurers and providers. 

For behavioral health practices that are out-of-network with some plans, or that see a mix of in-network and self-pay patients, the NSA means: 

You can’t rely on off-guard balance bills to close revenue gaps. 

You must provide clear, documented GFEs, and track your actual charges against them. 

If you use IDR, you need clean documentation and strong comparative data to avoid spending more on disputes than you recover. 

This is where your revenue cycle infrastructure matters. Practices with structured fee schedules, accurate payer contract data, and disciplined documentation are much better positioned to stay compliant and protect revenue under the NSA. 

Mental Health Parity in 2025 

On paper, the Mental Health Parity and Addiction Equity Act (MHPAEA) has been law since 2008, requiring insurers to treat mental health and substance use disorder benefits on par with medical/surgical benefits. The Department of Labor’s parity page lays out the basic requirement: no more restrictive limits on mental health benefits than on comparable medical benefits. 

In practice, parity in 2025 is messy. In 2024, the Departments of Labor, HHS and Treasury finalized new rules tightening standards for non-quantitative treatment limitations (NQTLs) things like prior auth, network design and medical management, pushing plans to analyze and justify differences between medical and mental health coverage. 

Then came lawsuits. In 2025, employer groups challenged those rules in court, and federal agencies responded by announcing that they would temporarily not enforce the 2024 parity rule while litigation plays out, adding an additional grace period after a final decision. 

What does this mean for your revenue? 

Payers may be slower to change their internal processes, keeping some restrictive NQTLs in place. 

However, the underlying parity statute (MHPAEA) is still in force, and parity arguments can be powerful tools in denial appeals, especially for high-intensity services or not medically necessary determinations. 

To leverage parity in appeals, you need clear documentation, defined medical necessity criteria, and an ability to compare how a plan treats mental health vs medical services. 

Revenue Cycle Basics That Matter More Than Ever 

Underneath all the regulations, revenue protection still comes down to basics: do you reliably turn visits into clean claims, and claims into cash, without leaving money on the table? 

Classic revenue cycle metrics, first-pass claim acceptance, denial rate, days in A/R, net collection rate, apply just as much to small psychotherapy and psychiatry practices as to large systems. The AMA’s revenue cycle management guide suggests benchmarks like a >95% first-pass clean claim rate and days in A/R under 30 days for well-managed practices. 

For mental health providers, a few pressure points are especially important in 2025: 

Front-end eligibility and benefits checks. 

Because payer rules differ dramatically on visit limits, prior auth and telehealth coverage, verifying benefits at scheduling isn’t optional. Missed session caps and prior auth can turn weeks of therapy into write-offs. 

Documentation that proves medical necessity and time. 

Psychiatry medical billing and psychotherapy reimbursement still hinge on linking symptoms and impairments to billed services and clearly documenting time for time-based codes (e.g., 90832, 90834, 90837) and crisis or group services. 

Accurate behavioral health coding. 

Using psychotherapy codes, E/M codes, add-on psychotherapy with E/M, BHI/CoCM bundles, caregiver training, and crisis codes correctly can substantially change revenue. Under-coding is a silent leak; over-coding is an audit risk. 

Telehealth billing discipline. 

With permanent behavioral telehealth flexibilities, but shifting rules for other services, getting POS codes and modifiers wrong is a fast way to increase denials. 

Systematic denial management. 

Given 2025 policy turbulence, denials will happen. The difference between healthy and struggling practices is whether they track denial reasons and appeal where it makes sense, especially for parity and telehealth issues. 

The article on top billing challenges walks through these exact choke points and how they show up in everyday practice life: payer variability, complex psychotherapy/E/M combinations, telehealth modifiers, Part 2 and HIPAA privacy issues, prior auth bottlenecks, credentialing delays, and more. 

Practical Strategies to Protect Revenue in 2025 

You can’t fix federal policy from your office, but you can tighten the way your practice responds to it. A practical revenue protection strategy for small US mental health practices in 2025 usually includes a few key moves. 

Know your payer mix and 2025 contracts 

Pull a simple report of your top payers and CPT codes for psychotherapy, psychiatry and telehealth. Compare your 2024 and 2025 allowed amounts for your most common services. CMS fact sheets and summaries from groups like the American Psychological Association and NASW give helpful context for Medicare, which often influences commercial contracts. 

If you see significant drops in reimbursement, ask: 

Are there underused codes (e.g., BHI/CoCM, caregiver training) you legitimately deliver but aren’t billing? 

Are there services you should reprice or reconsider offering under certain plans? 

Treat telehealth as a specialty, not a side channel 

Tele-behavioral health has matured. An article explains how telehealth, digital therapeutics and hybrid models are reshaping both care delivery and billing, and why behavioral health providers need telehealth-specific workflows, templates and RCM logic. 

At minimum, your practice should: 

Capture modality (video vs audio), patient location and consent in notes 

Use correct telehealth POS and modifiers based on payer rules 

Monitor telehealth denials separately to catch pattern errors fast 

Build parity-aware appeals without betting the farm 

With MHPAEA in force but 2024 rules partially non-enforced, this is not the year to pin your entire revenue plan on parity lawsuits. However, it is smart to: 

Flag denials that seem to treat mental health more harshly than comparable medical services 

Maintain copies of plan documents and EOB language about limits, prior auth and network requirements 

Work with billing partners or attorneys who understand how to reference parity in appeals when it’s worth it 

Decide if in-house billing still makes sense 

Behavioral health RCM is now a specialty in its own right. Articles on psychiatry billing and behavioral health RCM consistently point out that small practices struggle to keep up with changing codes, payer rules and denial patterns without dedicated staff and technology. 

If your clinicians, front-desk team or office manager are spending more hours on mental health billing, prior auth, payment posting and appeals than on patient-facing work, your revenue problem is also a time and burnout problem. 

Bringing It All Together 

Protecting revenue in 2025 as a small US mental health practice is not about one magic code or one new law. It’s about seeing the whole chessboard: 

Medicare and commercial fee pressures that shrink margins unless you use available codes and structure your contracts intelligently. 

Telehealth and digital care that create access and volume; but only pay off if you bill them correctly. 

No Surprises Act and mental health parity rules that change how you handle out-of-network patients, estimates and appeals. 

Revenue cycle basics; eligibility, documentation, coding, denial management—that quietly determine whether your packed schedule turns into stable cash flow. 

The encouraging part is that you don’t have to do everything at once. Many practices see significant improvement just by: 

Cleaning up telehealth templates and POS/modifier usage 

Standardizing documentation for psychotherapy time and medical necessity 

Running a denial pattern analysis for their top three payers 

Moving from generic billing support to behavioral health-specific RCM 

Over time, those changes compound—higher clean-claim rates, lower denials, better cash flow, less time wasted on billing firefights. 

Why Delon Health Is a Revenue Partner, Not Just a Billing Vendor 

If you recognize your own practice in these challenges, you’re not alone, and you don’t have to fix it all with a patchwork of spreadsheets and guesswork. 

Through services that span eligibility and prior auth, coding and charge capture, telehealth billing, denial analytics, appeals and compliance workflows, Delon Health turns complex rules into clean, compliant claims and predictable cash flow. 

The Delon Health blog already dives deep into topics like top billing challenges for mental health providers, 2025’s mental health telehealth trends, and reasons insurance claims get denied, giving you free education even before you sign a contract. 

If 2025 has you juggling lower reimbursement, more rules and rising denials, this is the moment to bring in a specialist. Visit delonhealth.com to learn how Delon Health’s behavioral health revenue cycle management can help your practice.