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Updated: May 22, 2026

Functional Near-Infrared Spectroscopy Hyperscanning Study in Psychological Counseling

Functional Near-Infrared Spectroscopy Hyperscanning Study in Psychological Counseling

Published on: January 17, 2025

Occupational Licensing and Psychologist Supply.

¹University of Toronto Mississauga, Mississauga, Ontario, Canada.

Health Economics

|May 21, 2026

Summary

Reducing state licensing barriers via PSYPACT increased mental health provider listings by 7.7%. However, this growth came from existing psychologists expanding their reach, not new providers entering the market.

Keywords:

PSYPACT access inequality digital platforms market entry mental health care occupational licensing telemedicine

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Last Updated: May 22, 2026

Functional Near-Infrared Spectroscopy Hyperscanning Study in Psychological Counseling

Functional Near-Infrared Spectroscopy Hyperscanning Study in Psychological Counseling

Published on: January 17, 2025

Area of Science:

Health Services Research
Health Economics
Behavioral Health Policy

Background:

Interstate licensing barriers limit mental health provider supply.
The Psychology Interjurisdictional Compact (PSYPACT) aims to reduce these barriers for psychologists practicing telemedicine.
Tracking provider entry across state lines, especially via telemedicine, presents data challenges.

Purpose of the Study:

To investigate whether reducing interstate licensing barriers increases the supply of mental health providers.
To analyze the impact of PSYPACT on provider listings and market entry.
To understand the behavioral response of incumbent providers to reduced licensing friction.

Main Methods:

Utilized data from a large mental health provider search platform, tracking zip code listings.
Employed a difference-in-differences approach, leveraging staggered state accession to PSYPACT.
Analyzed changes in provider listings before and after states joined the compact.

Main Results:

Joining PSYPACT increased provider listings by 7.7% within one year.
The increase was driven entirely by incumbent psychologists adding new listings, not new providers entering.
States with higher initial licensing costs showed larger increases in incumbent listings.
Incumbents preferentially listed in underserved, high-income areas within states.

Conclusions:

Reducing interstate licensing barriers through PSYPACT does not immediately increase the number of mental health providers.
Incumbent providers adapt to reduced barriers by expanding their service areas, potentially in response to perceived competition.
Policy changes aimed at increasing provider supply need to consider the strategic responses of existing practitioners.