Behavioral Health M&A: A Promising Outlook

After a two-year lull, behavioral health businesses are firmly back in the crosshairs of private equity and strategic buyers. The first quarter of 2025 saw a surge in deal activity, with behavioral health leading the way across health care services. According to recent research, behavioral health deal volume was up 53% from Q4 2024, with autism-related deals alone doubling quarter-over-quarter, the strongest showing since Q4 2020.

While macroeconomic factors like interest rates, tariffs, and changes to Medicaid reimbursement create uncertainty, many buyers are turning to behavioral health as a safe haven, especially when demand continues to outpace supply and reimbursement often comes from more stable commercial payers.

What Makes Behavioral Health So Resilient?

There’s no question that behavioral health has become a critical part of the national care infrastructure. Autism services, substance use disorder (SUD) programs, intellectual and developmental disability (IDD) providers, and mental health clinics all serve populations with urgent and ongoing needs. Many of these services are reimbursed by private insurance, insulating providers from some of the pricing pressure currently hitting other corners of the healthcare system.

Behavioral health also tends to offer:

• High recurring revenue from long-term care relationships
• Scalability through group practices and outpatient networks
• Fragmented markets ripe for roll-up strategies
• Clinical staff scarcity, which, while a challenge, can also serve as a high barrier to entry, protecting established providers and leading to acqui-hires

In an uncertain economy, the consistency and defensibility of these business models are increasingly attractive to investors who need to deploy dry powder.

Don’t Overlook Speech Pathology

Another corner of healthcare with many of these same traits is speech-language pathology, especially when it intersects with behavioral health. Demand for pediatric speech therapy is growing alongside the rising diagnoses of autism and developmental delays. In fact, many autism therapy clinics now bundle speech therapy into their service offerings, creating integrated care models that improve outcomes and increase reimbursement.

From a buyer’s perspective, speech-language businesses often have:

• Strong referral pipelines from pediatricians and school systems
• High insurance reimbursement rates, particularly when part of autism treatment
• Opportunity to expand through teletherapy and school contracts
• Consistent demand, regardless of broader market conditions

As private equity looks to build more durable platforms in healthcare, speech-language pathology could represent an accessible, synergistic addition to behavioral health portfolios.

Why This Matters Now

Several tailwinds are aligning to create urgency for buyers, including:

• Capital deployment pressure: Funds that held back in 2023 and 2024 now face aging dry powder and must re-enter the market.
• Volatility advantage: With uncertainty in public and international markets, buyers are gravitating toward privately held businesses with strong cash flows and recession-resistant demand.
• Service focus: With macro headwinds like tariffs not completely settled, service-based businesses have an advantage over businesses reliant on goods and imports.

At Align, we’re seeing this play out in real-time: buyers are asking specifically for commercial-pay behavioral health and therapy businesses with room to scale. For founders and owners in these spaces, the next 6 to 12 months may be the optimal time to explore a transaction – while capital is flowing and valuations remain strong.

Interested in what your business might be worth in today’s market?
Let’s talk. Align’s healthcare and human services team has deep experience advising behavioral health, speech therapy, and pediatric care businesses through successful exits. We’re here to help you find the right partner, and the right terms.