The commission held a public hearing in Launceston on Monday, examining the effects of poor mental health on productivity, the economy and people's ability to participate and prosper in the community.

Tasmanian leaders in mental health care spoke of a worsening crisis, particularly in rural and remote areas, where a lack of services and ongoing stigma were harming access to support.

Sally Jones, of Tasmanian Life Counselling, said people in rural and remote areas were being left on waiting lists for four to six months to see a psychologist.

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"If you've got suicidal ideation, you can't be waiting four months until you can see someone," she said.

"We've got a pool of counsellors that could fill that gap.

"We need to have a greater availability of resources and we've got it right here under our nose. I just don't understand why degree-qualified people are not able to come on board and offer these services, and are just not recognised, it's ridiculous."

She said the lack of a rebate under the Medicare Benefits Schedule for counselling meant at-risk individuals were missing out on continued support while they waited for more clinical support.

The commission heard of instances on the West Coast where people would avoid seeing a psychologist in their own town due to the stigma and would instead go to another town.

It also heard that a lack of psycho-educational programs - such as court-mandated behavioural programs - in regional centres meant many former offenders were simply unable to attend and were missing out on rehabilitation.

Mental Health Council of Tasmania chief executive officer Connie Digolis said the skills shortage was statewide.

"We've actually got shortages across the entire state, so in our urban areas we've got limited access to psychologists and psychiatrists," she said.

"We have a recognised clinical shortage across the board."

The Productivity Commission's draft report recommended developing standards for a three-year direct entry degree in mental health nursing, with a timeframe of between two and five years.

But Michael Blair, of the Australian College of Mental Health Nurses, said this needed to be implemented immediately.

"The two-to-five year recommendation timeframe was seen as being not adequate in the fact that we are really facing a crisis at our current time," he said.