The Big Blunder Happening Right Now in Digital Mental Health
Written by members of Therapists in Tech
Executive summary
Virtually every digital mental health company is using the same playbook to cut costs, but this plan is going to hurt businesses in the near future. Companies that avoid this trend are going to be the winners in this space.
What’s the strategy? Laying off clinical scientists and practitioners as part of an overall reduction in force. While this cuts short term costs, it has a negative impact on virtually all key business metrics in the D2C and B2B space, leading to inability to earn and sustain deals, or grow healthy consumer lifetime value (LTV).
Impact on the D2C Space
Laying off clinical scientists and practitioners embedded in product, content, and program development roles degrades clinical quality. While we should care about this as an end in itself, the truth is that declines in clinical quality damage patient/user engagement, trust, and clinical outcomes, ultimately resulting in churn, unfavorable consumer ratings in app stores, and a negative effect on word-of-mouth uptake.
To make matters worse, letting go of culturally competent embedded mental health experts — who incorporate the needs of clients/users with BIPOC (Black, Indigenous, People of Color), LGBTQ+ (Lesbian, Gay, Bisexual, Transgender, Queer, Plus), and other marginalized identities — means that the addressable market of these products and services shrinks.
More and more outlets are providing a window into quality for consumers. For example, One Mind PsyberGuide, rates products along several dimensions, including credibility. Credibility is not only implicated in how likely it is that a digital offering will work, but also involves the rigor of the development process — including ongoing maintenance. To receive a high score, One Mind PsyberGuide requires that digital programming be revised at regular intervals and that clinical leaders with mental health expertise be involved in development. Digital mental health companies that cut their clinical teams will see decreases in these scores, which drives up customer acquisition cost (CAC), a major expense to D2C businesses.
Companies that still market and sell based on claims about their clinical quality while simultaneously straining or eliminating their clinical input and oversight may be effective in decreasing their Customer Acquisition Costs (CAC) — if great benefits are claimed, then people will come to try and reap them — but will also greatly increase the likelihood of patient and customer churn, as users discover that the promises of the ads do not come true. If users don’t stay, there’s no amount by which companies can realistically lower acquisition costs that will yield acceptable unit economics.
Impact on the B2B Space
Without the guidance of embedded mental health professionals, clinical quality and standards will also decline in the B2B space, where success is often contingent on meeting a high bar for clinical outcomes; savvy clients quickly notice the impact of lower product quality in the data. Without experts on clinical mechanisms of action (MOAs) and behavior change driving clinical product, metrics such as uptake, engagement, adherence/compliance, and outcomes/effectiveness will decrease. Enterprise customers are more skeptical when clinicians are not part of sales deals and clinical research teams have not published peer-reviewed articles on the efficacy and safety of the company’s products and services. Deals may be lost when customers expecting clinical excellence are met with clinical absence.
When the products and services of digital mental health companies are converging, successful sales will be made by the companies that have the better products and services, and who can show evidence from previous deals that excellent clinical results can be expected. The companies with robust clinical leadership, oversight, and staffing will be best positioned to continually deliver the best products and services, including meeting performance guarantees. In a sea of services that appear similar to customers, embedding mental health experts in development and maintenance is not only a key differentiator, but a prerequisite for meeting and exceeding contractual obligations and compliance requirements.
Clinical leaders with decision-making capacity within payer, provider, and large employer systems — and at other digital mental health companies seeking to merge with or acquire a company — conduct thorough analyses of digital offerings. If clinical products and programs purported to be clinician-reviewed do not actually have clinicians on staff who are actively and continuously reviewing content for safety, effectiveness, quality, etc., the company’s credibility and integrity will come into question. If clinical standards, including credibility, are not maintained, neither are contracts. Clinician review of content is also essential for many types of compliance needs — claims made in content must adhere to relevant regulatory standards.
Next Steps and Guidance for the Field
Companies are under a lot of pressure to cut costs, but decreasing or eliminating clinical roles removes the people in the company who know the most about what every company in this space is trying to do: heal people. Rather than risking drops in essential metrics, losing user base, losing contracts, or missing out on deals, companies should hold on tight to their mental health professionals. If they’ve already laid off their mental health teams, it might not be too late to open back up clinical roles. Consider part-time positions or seeing if clinically-trained employees can split time between teams. Companies can also see if clinically-trained employees are interested in making a career pivot into a different functional area of the company where their expertise and input would bring broad value and the company can justify the move financially. Ultimately, maintaining high clinical quality is the best thing to do, not just for clinical care, but for the bottom line.
This article was written with anonymous contributions from members of the Therapists in Tech non-profit group.
