Psychiatric and Substance Abuse Hospitals (U.S.) — NAICS 62221

An investor's primer. NAICS (the North American Industry Classification System) code 62221 is a five-digit industry that covers hospitals licensed to provide inpatient medical treatment for mental illness and substance use disorders. It contains exactly one national (six-digit) industry, 622210, so this page is a short rollup: the two levels are effectively the same thing.

1. Overview

This industry is the inpatient, hospital-grade tier of behavioral health — locked and unlocked facilities that admit people in acute psychiatric crisis (suicidality, psychosis, severe depression) or for medically supervised detoxification and stabilization from drug and alcohol dependence. These are hospitals, not counseling centers: they keep licensed beds, staff physicians and psychiatric nurses around the clock, and operate under intense federal and state regulation.[1]

The reason the category matters to investors is a persistent mismatch: demand is large, structurally rising, and unusually recession-resistant, while the supply of psychiatric beds is chronically short and reimbursement is dominated by government payers. That combination — durable demand plus tightly regulated pricing — makes the business both attractive and risky.

Because this five-digit industry has only one child, everything below is a summary. For the full analysis — the investable companies, the per-day revenue model, demand statistics, the regulatory map, consolidation, and risks — read the leaf primer for NAICS 622210.

2. What's inside — and why this level equals its one child

In the NAICS hierarchy, a five-digit "industry" can split into two or more six-digit "national industries." NAICS 62221 does not split: it maps one-to-one to a single child.

With one child holding the entire level, the aggregate figures for 62221 and the detailed figures for 622210 are identical. This page therefore stays deliberately short and defers all depth to the child primer.

What the code covers: establishments licensed as psychiatric or substance-abuse hospitals, providing acute inpatient psychiatry, detoxification, dual-diagnosis care (treating mental illness and addiction together), and adolescent and specialty treatment.[1] What it excludes is just as important: psychiatric units inside general medical and surgical hospitals (NAICS 622110 — where a large share of U.S. psychiatric admissions actually happen), residential "rehab" facilities (NAICS 623220), and outpatient clinics and therapist offices (NAICS 621420 and 621330).[1] Ownership is unusually three-sided — state/county/federal government (including the U.S. Department of Veterans Affairs, the VA), nonprofit and academic hospitals, and fast-growing for-profit chains.[1][6]

3. Size (this level's figures)

Because 62221 equals 622210, the level's official statistics are the child's. All figures below come from our ground-truth federal dataset for this industry.

Undercount caveat — read the two lenses carefully. County Business Patterns (CBP) is an employer-based series that normally omits government establishments, but it makes an explicit exception for hospitals, so its establishment, employment, and payroll counts capture public as well as private psychiatric hospitals and are relatively complete.[2][5] The 2022 Economic Census, by contrast, excludes government-owned establishments, so its receipts ($29.09 billion) and firm count (403) cover only for-profit and nonprofit operators. Because state and county governments still own roughly half of standalone psychiatric beds,[6] treat the receipts and firm counts as the private-market size, not the whole system — the true revenue and hospital count across all owners are higher. The Herfindahl-Hirschman Index (HHI), a standard measure of market concentration, is suppressed in the federal data for this code, so no HHI value is available.[3]

4. Investable universe (where value concentrates)

With a single child industry, there is no cross-child allocation question: all the investable value sits in 622210. No listed company is a pure-play, code-only operator — every public name combines psychiatric hospitals with outpatient, residential, or general-hospital services — and public exposure is remarkably concentrated in two operators.

• Acadia Healthcare (Nasdaq: ACHC) — the closest listed behavioral-health specialist; at year-end 2025 it ran 277 behavioral facilities with more than 12,500 beds across 40 states and Puerto Rico.[9]
• Universal Health Services (NYSE: UHS) — a diversified hospital operator whose behavioral division is the largest investor-owned behavioral footprint in the U.S.; behavioral health was roughly 44% of 2024 company revenue.[11][12]
• HCA Healthcare (NYSE: HCA) — a general-hospital operator with only incidental psychiatric exposure (seven behavioral hospitals, 714 licensed beds).[13]

The largest bed pools — government, VA, and nonprofit systems (McLean, Sheppard Pratt, Menninger, Rogers) — sit with owners no investor can buy. Private-market investors reach the industry more directly through private-equity platforms (Lifepoint Behavioral, Summit BHC, Oceans Healthcare, Signature Healthcare Services), facility ownership, real estate, and private credit.[15][16][17][19] See the 622210 primer for the full universe.

5. How the money works

An inpatient psychiatric hospital earns revenue mainly on a per-day (per diem) basis — roughly patient days × net revenue per patient day. Occupancy (beds filled ÷ beds available) is the biggest swing factor because costs are largely fixed to the bed count, so incremental admissions drop through to profit. Payer mix drives the rate: behavioral care skews toward government payers (Medicaid and Medicare) more than general-hospital care, with commercial insurance paying the most per day. Costs are labor-dominated — psychiatrists, nurses, therapists, and technicians — so wage inflation and reliance on contract (agency) staffing are the main margin risks, while staffing also caps capacity. Because psychiatric hospitals need far less capital equipment than acute-care hospitals (no operating rooms, imaging suites, or ICUs), well-run operators have historically earned higher operating margins, and growth comes chiefly from adding beds — expansions, new (de novo) facilities, and joint ventures with nonprofit systems — rather than raising prices.[9][21]

6. Demand drivers

Demand is deep and structurally rising. The 2024 National Survey on Drug Use and Health (NSDUH), from the Substance Abuse and Mental Health Services Administration (SAMHSA), reported 61.5 million U.S. adults (23.4%) with any mental illness, 48.4 million people aged 12+ with a past-year substance-use disorder (SUD), and a large treatment gap.[7] Drug-overdose deaths remain very high despite a sharp 2024 decline (an estimated 80,391, down about 27%),[8] keeping detox and dual-diagnosis demand elevated. Youth mental health, a chronic bed shortage (patients "board" in emergency rooms for lack of beds), and broader insurance coverage plus parity enforcement all channel more people into acute care. The caveat: high prevalence creates a large addressable need, but patients may be treated outpatient, lack coverage, or be cared for in public systems — so need does not automatically become inpatient revenue.

7. Regulation

This is a heavily regulated industry where rule changes move earnings directly. Medicare pays under the Inpatient Psychiatric Facility Prospective Payment System (IPF PPS), a federal per-diem rate the Centers for Medicare & Medicaid Services (CMS) resets annually (a 2.5% rate increase for fiscal 2026).[20][21] Medicaid is constrained by the IMD exclusion — federal Medicaid generally will not pay for care in an "Institution for Mental Diseases" (a psychiatric facility with more than 16 beds) for adults aged 21–64, the single biggest structural limit on inpatient economics, now partially relaxed by the 2018 SUPPORT Act and state waivers.[22] Other key regimes: EMTALA emergency-treatment duties,[23] the Mental Health Parity and Addiction Equity Act (MHPAEA),[25] substance-use-records privacy (HIPAA and 42 CFR Part 2),[27] and state licensure, involuntary-commitment statutes, and Certificate of Need (CON) laws that gate new beds (35 states plus Washington, D.C., as of January 2025).[24] Full detail is in the 622210 primer.

8. Consolidation

On the federal data the industry looks fragmented: the four largest firms account for just 21.4% of 2022 revenue, the top eight 26.2%, the top twenty 38.0%, and the top fifty 53.5%.[3] But those ratios understate concentration in the investor-owned, standalone segment, where UHS and Acadia are the two national platforms and for-profit chains have taken bed share from a retreating government sector (the for-profit share of standalone psychiatric beds rose from about 11% to 27% between 2011 and 2023).[6] Consolidation runs on three tracks — public chains buying and building beds, joint ventures with nonprofit systems, and heavy private-equity roll-up of the adjacent outpatient and residential segments.[26]

9. Risks

The risks are the child's risks. In brief: reimbursement and policy (Medicaid cuts, adverse IPF PPS updates, or a tightening of the IMD exclusion hit margins directly); labor (clinician shortages, wage inflation, contract-staffing dependence); volume softness (demand is deep but not automatic — UHS reported behavioral volume below plan in 2025);[28] quality, legal, and reputational risk (sustained scrutiny of for-profit patient-safety and billing practices; Acadia's $19.85 million 2024 whistleblower settlement);[24][21] payer pushback (prior authorization and denials); expansion and capital risk (CON, construction, ramp-up); and classification/data risk (top-down sizing understates government-linked activity, as the undercount caveat above shows).

10. How to invest & outlook

Because this five-digit level collapses to one child, the how-to-invest picture is exactly that of 622210: direct listed exposure is effectively two operators — Acadia (ACHC) as the near pure-play specialist and UHS as the diversified operator with the largest behavioral footprint, plus HCA as incidental exposure — with no dedicated psychiatric-hospital fund, so single-name and policy risk are hard to diversify away (Acadia's stock fell roughly 64% during 2025).[9][11][13][14] Private capital reaches the industry through PE behavioral platforms, direct or joint-venture operator partnerships, specialty behavioral real estate, and private credit, though the largest bed pools (government and nonprofit) stay outside investable channels. Outlook: a structurally favorable demand backdrop — rising diagnosed prevalence, large treatment gaps, parity enforcement, chronic bed shortages — points to durable volume growth, with bed additions the clearest earnings lever, capped by Medicaid budget pressure, modest reimbursement updates, a tight clinical-labor market, and intensifying scrutiny of for-profit inpatient practices.

For the complete treatment of every section above, see the leaf primer: NAICS 622210 — Psychiatric and Substance Abuse Hospitals.

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Sources

1. U.S. Census Bureau, 2022 NAICS Definition — 622210 Psychiatric and Substance Abuse Hospitals (scope and exclusions), 2022. https://www.census.gov/naics/?details=622210&input=622210&year=2022
2. U.S. Census Bureau, County Business Patterns: 2023, NAICS 622210 (establishments, employment, payroll), 2025. https://www.census.gov/data/datasets/2023/econ/cbp/2023-cbp.html
3. U.S. Census Bureau, 2022 Economic Census — Concentration of Largest Firms (receipts, firm count, CR4/CR8/CR20/CR50, HHI suppressed), NAICS 622210, 2025. https://data.census.gov/table/ECNSIZE2022.EC2200SIZECONCEN?codeset=naics~622210
4. U.S. Census Bureau, County Business Patterns Methodology (employer-based coverage; government-establishment exception for hospitals), 2026. https://www.census.gov/programs-surveys/cbp/technical-documentation/methodology.html
5. Columbia University Mailman School of Public Health, Large For-Profit Chains Gain Share of Psychiatric Hospital Inpatients, 2025. https://www.publichealth.columbia.edu/news/large-profit-chains-gain-share-psychiatric-hospital-inpatients
6. Substance Abuse and Mental Health Services Administration (SAMHSA), Key Substance Use and Mental Health Indicators: Results from the 2024 National Survey on Drug Use and Health, 2025. https://www.samhsa.gov/data/sites/default/files/reports/rpt56287/2024-nsduh-annual-national/2024-nsduh-annual-national.htm
7. CDC National Center for Health Statistics, U.S. Overdose Deaths Decrease Almost 27% in 2024 (est. 80,391 in 2024), 2025. https://www.cdc.gov/nchs/pressroom/releases/20250514.html
8. Acadia Healthcare, 2025 Form 10-K (facility and bed counts, payer mix), 2026. https://www.sec.gov/Archives/edgar/data/1520697/000119312526078266/achc-20251231.htm
9. Universal Health Services, 2025 Form 10-K (behavioral-division operating statistics), 2026. https://www.sec.gov/Archives/edgar/data/352915/000119312526071676/uhs-20251231.htm
10. Universal Health Services, 2024 Fourth Quarter and Full Year Financial Results (total and behavioral-segment net revenue), 2025. https://www.prnewswire.com/news-releases/universal-health-services-inc-announces-2024-fourth-quarter-and-full-year-financial-results-and-2025-operating-results-forecast-302386507.html
11. HCA Healthcare, 2025 Annual Report to Shareholders (behavioral hospitals and beds), 2026. https://s23.q4cdn.com/949900249/files/doc_financials/2024/ar/HCA-2025-Annual-Report-to-Shareholders-FINAL.pdf
12. CompaniesMarketCap, Market Capitalization of Acadia Healthcare (ACHC), 2026. https://companiesmarketcap.com/acadia-healthcare/marketcap/
13. Lifepoint Health, Lifepoint Health Acquires Majority Ownership Interest in Springstone, 2023. https://www.lifepointhealth.net/news/2023/02/07/lifepoint-health-acquires-majority-ownership-interest-in-springstone
14. Patient Square Capital, Summit BHC (portfolio), 2021. https://patientsquarecapital.com/portfolio/summit-bhc/
15. Oceans Healthcare, Oceans Healthcare Acquires Haven Behavioral Healthcare, Inc., 2025. https://oceanshealthcare.com/news/oceans-healthcare-acquires-haven-behavioral-healthcare-inc/
16. Signature Healthcare Services, About SHC, 2026. https://signaturehc.com/about
17. Centers for Medicare & Medicaid Services, FY 2026 Inpatient Psychiatric Facility PPS and Quality Reporting Updates Final Rule — Fact Sheet, 2025. https://www.cms.gov/newsroom/fact-sheets/fy-2026-inpatient-psychiatric-facility-prospective-payment-system-ipf-pps-quality-reporting
18. Centers for Medicare & Medicaid Services, Inpatient Psychiatric Facility PPS — Overview, 2025. https://www.cms.gov/medicare/payment/prospective-payment-systems/inpatient-psychiatric-facility
19. Congressional Research Service, Medicaid's Institution for Mental Diseases (IMD) Exclusion (IF10222), 2024. https://www.congress.gov/crs-product/IF10222
20. Centers for Medicare & Medicaid Services, Emergency Medical Treatment & Labor Act (EMTALA), 2026. https://www.cms.gov/medicare/regulations-guidance/legislation/emergency-medical-treatment-labor-act
21. ProPublica, For-Profit Corporations Are Buying Up More Psychiatric Hospitals. Some Flout Federal Law With Scarce Repercussions, 2024. https://www.propublica.org/article/psychiatric-hospitals-emtala-mental-health-profit
22. U.S. Department of Labor, Employee Benefits Security Administration, Mental Health Parity and Addiction Equity Act (MHPAEA), 2025. https://www.dol.gov/agencies/ebsa/laws-and-regulations/laws/mental-health-parity
23. U.S. Department of Health and Human Services, Office for Civil Rights, Civil Enforcement Program for Confidentiality of Substance Use Disorder Patient Records (42 CFR Part 2), 2026. https://www.hhs.gov/press-room/hhs-announce-civil-enforcement-program-sud-patient-records.html
24. National Conference of State Legislatures, Certificate of Need State Laws, 2025. https://www.ncsl.org/health/certificate-of-need-state-laws
25. Behavioral Health Business, Acadia to Pay $19.85M to Settle Whistleblower Allegations Relating to Medically Unnecessary Inpatient Behavioral Health Services, 2024. https://bhbusiness.com/2024/09/26/acadia-to-pay-19-85m-to-settle-whistleblower-allegations-relating-to-medically-unnecessary-inpatient-behavioral-health-services/
26. Behavioral Health Business, Private Equity Owns 6.2% of Mental Health, 7.1% of Addiction Treatment Facilities, 2024. https://bhbusiness.com/2024/05/01/private-equity-owns-6-2-of-mental-health-7-1-of-addiction-treatment-facilities/
27. Capstone Partners, Behavioral Healthcare Services Market Update (private-equity deployment and M&A trends), 2025. https://www.capstonepartners.com/insights/article-behavioral-healthcare-services-market-update/
28. Fierce Healthcare, Universal Health Services Projects More Revenue, Earnings Gains in 2026 After 2025 Volume Shortfall, 2026. https://www.fiercehealthcare.com/providers/universal-health-services-projects-more-revenue-earnings-gains-2026