Hi friend,

“I was taught that the way of progress was neither swift nor easy”.

Before I sent this email to you, I was reading back over what I’d written. I couldn’t help but think of this quote from Marie Curie. You’re about to read about funding cuts for community mental health, a decline in research funding, understaffing of crisis workforce shortages and concerns about AI safety.

But you’ll also learn about mental health system reform, a new $77M venture fund dedicated to wellbeing, and important research shedding light on new treatments. It can be a confusing story and hard to know how much progress we’re actually making.

But today, I’m taking my inspiration from Curie. Progress may not be swift or easy, but if we can stumble forward with an ounce of the consistency and longevity she showed in her work, progress will come.

So…

⏺️ LifeStance reported strong Q1 results. Revenue grew 21% to $403.5M, visit volumes rose 18% to 2.5 million, and their clinician base grew 11% to 8,349. Net income was impressive, reaching $14.2M compared to $0.7M in Q1 2025, driven primarily by an improvement in operating leverage — G&A expenses only grew by 6% YoY. Total revenue per visit increased 3% YoY to $163.50 reflecting to some marginal rate improvements. The earnings report also referenced a large-scale outcomes study released earlier this year — a recognition of the importance of demonstrating outcomes in this market — and an appetite for tuck-in M&A. On the back of the strong results, management raised the full-year guidance for revenue, center margin and adjusted EBITDA. (link)

⏺️ TimelyCare acquired Alongside. TimelyCare — a virtual care provider that delivers mental health, medical, and coaching services to students — bought Alongside — an AI coaching platform for students. The deal aims to extend TimelyCare's model from point-of-need clinical care to earlier, continuous support across the full student population and is a further sign of the care model convergence we’re seeing in the US market. (link)

⏺️ Wisdom Ventures raised a $77.7M wellbeing fund. This is the firms second fund and will be focused on backing AI-native startups focused on human resilience, emotional wellbeing, and mental health infrastructure. (link)

⏺️ Aurora Mental Health cut 91 jobs due to funding shortfall. The Colorado-based provider told the state Department of Labor the cuts will take effect at the end of June. It is the latest in a string of layoffs hitting community mental health providers facing funding pressure. (link)

⏺️ Arisa Health to close clinics and end crisis services in Arkansas. The provider, which has operated in Arkansas for over 55 years, will not renew its state contract when it expires on June 30, affecting mobile crisis services, forensic restoration, and services to incarcerated individuals. (link)

⏺️ US HHS announced a federal push to reduce antidepressant prescribing. HHS Secretary Kennedy announced new training programmes, reimbursement mechanisms, and clinical guidelines aimed at encouraging doctors to help patients taper off SSRIs and consider non-drug alternatives like therapy, exercise, and nutrition. (link)

⏺️ Ireland passed its first major mental health law reform. President Connolly signed The Mental Health Act 2026 into law last week. For the first time, child and adolescent mental health services in Ireland will be subject to formal legal oversight. The law also gives patients a stronger say in their own care decisions. (link)

⏺️ Pennsylvania sued Character.AI over alleged fake psychiatrist chatbot. Pennsylvania Gov. Josh Shapiro’s administration has filed a suit against Character.AI alleging its chatbots falsely claim to be medical professionals. One chatbot called Ellie describes itself as a doctor of psychiatry stating that it holds licenses in the U.K. and Pennsylvania and allegedly providing a fake license number. (link)

⏺️ Oregon now requires AI companion apps to refer teens in crisis to humans. A new Oregon law passed both chambers near-unanimously. It requires AI companion apps to detect language indicating suicidal ideation or self-harm and connect them to relevant crisis support. (link)

⏺️ Common Sense Media launched an independent AI safety institute for children. The Youth AI Safety Institute will independently test AI products that children use, publish the results, and set safety standards. Dr. Vivek Murthy, former Surgeon General of the United States and a member of Common Sense Media's Board of Directors noted that “we are at great risk of making the same mistakes with AI that we made with social media”. I couldn’t agree more. (link)

⏺️ ChatGPT added a crisis contact feature for users in distress. OpenAI launched "Trusted Contact," which lets users name someone who can be contacted if they appear to be in crisis. It is a notable step as general-purpose AI tools are increasingly being used for mental health support. (link)

⏺️ Sword Health outlined its MindEval evaluation framework. The company shared an interesting article outlining how they built MindEval, an open-source benchmark designed to assess LLM performance in mental health support. For anyone interested in evals, it’s worth a read. (link)

⏺️ IAMHRF release report on global mental health research funding trends. The International Alliance of Mental Health Research Funders report examined ~110,000 grants from 40 funders (2014–2023), showing interesting trends in mental health research funding. Total funding increased from $4.7B in 2014 to $8.7B by 2020 before declining to $4.6B by 2023. There has been an uneven allocation of funding across conditions, geographies, and age groups, with persistent gaps in youth, LMIC, and severe mental illness research. This is an interesting and important report. (link)

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⏺️ Meta-analysis finds AI chatbots may reduce depression in older adults, but not loneliness. A review of 8 RCTs covering 611 older adults found that AI conversational agents were associated with a small but statistically significant reduction in depressive symptoms (Hedges' g = -0.25). No significant effect on loneliness was found, and the results across studies varied widely (I² = 89%), limiting conclusions. Cognitively-focused tools showed more consistent effects than companionship-focused approaches. (link)

⏺️ Large observational study from Slingshot mapped how AI mental health chatbot use relates to outcomes. A study on 102,684 users analysed real-world engagement patterns with AI mental health chatbots, identifying distinct “engagement phenotypes” and reporting dose–response relationships between level of use and clinical outcomes, highlighting how interaction intensity may correlate with symptom change in digital mental health tools. (link)

⏺️ One in three clinicians report encountering patients using AI for mental-health purposes. A Society of Digital Psychiatry survey published by John Torous, MD MBI, found ~1/3 of respondents had already encountered patients using AI for mental-health purposes. Most rejected “AI psychosis” as a formal diagnosis but recognised the real concerns of sycophancy and dependency in AI use. Finally, respondents emphasised the urgent need for action around safety standards, research infrastructure, and clinical integration. (link)

⏺️ Most 988 Lifeline centers report staffing shortages in the US. A national survey of leaders from 159 U.S. and territory 988 Suicide & Crisis Lifeline centers found 71% reported being understaffed, and 89% reported difficulty securing funding to hire. Challenges were linked to recruitment, retention, and operational demands, highlighting workforce strain as a key risk to service capacity and quality. (link)

⏺️ Psychiatric disorders show comparable biological heterogeneity to non-psychiatric illnesses, often diverging from diagnostic classification. A study of 445,374 people found that patients with the same psychiatric diagnosis often have very different underlying biology, similar to patients with physical illnesses. Interestingly, the findings suggest that glucose dysregulation is pervasive yet variable across diseases. The authors state that the findings support the case for more individualised treatment approaches in psychiatry. (link)

⏺️ Researchers find a gap between bipolar disorder research and patient priorities. This study conducted an NLP analysis of Reddit threads to find the topics people with bipolar disorder discuss most. Many of these topics — including misdiagnosis, daily coping, and medication side effects — appear far less often in the academic literature than in conversations in patient communities. (link)

⏺️ Emotion regulation linked to better outcomes in parents of autistic children. A study of 263 parent couples found that parents with stronger emotional regulation had better mental health outcomes. Suppressing emotions (self-inhibition) was not associated with the same benefit. The findings suggest emotion regulation skills may be one of the more useful focuses for caregiver support programmes. (link)

That’s all for this week.

Keep fighting the good fight!

Steve Duke

Founder of Hemingway

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