Thinking of Buying a Psychology Practice in Australia? Here Are 3 Vital Questions to Ask
The “Other Health Services” industry in Australia — which includes psychology along with allied health services such as audiology, speech therapy, dietetics, etc. — generated AU$17.5 billion in revenue in 2025-26, with over 147,000 employees across 49,400 businesses.
Revenue has grown at roughly 2.0% CAGR over the past five years in that segment, driven by rising demand for mental health, wellness, and preventative care. IBISWorld Forecasts suggest continued growth as mental health awareness, government funding, and telehealth expand access.
1. Is the Practice Financially Sustainable in a Margin-Sensitive Allied Health Sector?
Why It Matters
Psychology practices tend to have moderate overhead costs (rent, professional accreditation, insurance, staff wages) but also strong dependency on referral rates, client volume, and reimbursement structures (private health insurance, Medicare, out-of-pocket). Pricing pressure, delays in payments (from insurers or Medicare), and competition from online/telehealth providers can compress margins.
What to Check
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Revenue mix – What portion comes from bulk-billed Medicare sessions vs private clients or corporate contracts/restorative work?
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Overheads – Look at rent (especially for consulting rooms), staff costs, licensing, insurance, software and telehealth platforms.
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Patient numbers / session load – How many clients/sessions per week, and utilization (are rooms under-used)?
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Payment terms / insurance billing delays – Assess how fast reimbursements arrive (Medicare, private health funds) and whether cash flow is robust.
2. Does the Practice Have Strong Demand & Reputation?
Why It Matters
Demand for psychological services has been rising in Australia, from both public and private sectors, due to growing awareness of mental health, workplace wellness programs, and rising rates of anxiety/depression etc. But many practices are solo or small, so differentiation, reputation, and location matter. A psychology practice with strong community, GP or institutional referrals will attract more steady demand.
What to Check
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Referral networks – Relationships with general practitioners, schools, workplaces, hospitals, community health centres.
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Specialisations – Whether the practice offers niche services (e.g. child psychology, clinical psychology, neuropsychology, counselling for specific conditions) that have higher demand or less competition.
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Location – Proximity to affluent suburbs, population centres, or underserved areas (regional/rural) where supply is lacking.
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Reputation and online presence – Client reviews, outcomes reporting, telehealth options, accessibility.
3. Is the Practice Positioned for Future Trends & Regulation?
Why It Matters
The psychology field is being reshaped by telehealth, digital therapy tools, regulatory scrutiny, workforce shortages, and increased demand for mental health support in workplaces and schools. Practices that adopt technology, maintain high ethical standards, and keep up with policy changes (Medicare / insurance) will be more resilient.
What to Check
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Technology readiness – Telehealth offerings, digital booking/records software, remote service delivery, online therapy tools.
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Regulatory compliance – Certification, accreditation, privacy laws, mental health legislation, insurance provider compliance.
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Funding environment – Changes in government programs, Medicare rebates, private health insurance policies, grants.
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Scalability and diversification – Ability to expand services (e.g. group therapy, online courses, workplace health) to reduce dependency on one-on-one sessions.
Ready to Invest in a Thriving Psychology Practice?
With increasing public awareness of mental health, growing demand, and expanding funding support, psychology practices in Australia are well-positioned for growth.
Success will depend on strong referral networks, careful financial management (especially of reimbursements and margins), adoption of technology, and alignment with regulatory changes.
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