New look at mental illness: bill tops $100bn

Severe mental illness is costing Australia nearly $100 billion a year, according to a new economic study.

The financial impact of mental illness is much greater than previously thought, with severe disorders alone costing Australia nearly $100 billion a year — 6 per cent of GDP — according to a new economic study.

The Victoria University analysis, commissioned by the national college of psychiatrists, finds ­almost half the estimated $98.8bn cost is due to thousands of early deaths from common physical illnesses among people with ­serious mental disorders.

It is believed to be the first Australian analysis of the overall cost of mental illness to include dollar values for early deaths, at least 12,000 of which have been estimated in separate research to occur annually.

The report has found that last year Australia incurred 518,785 ­“disability-adjusted life years” — years affected by illness or disability or lost to death — linked to five ­“serious mental illnesses” studied.

Opioid dependence — including abuse of heroin, morphine and codeine — contributed the largest number of disability-adjusted life years, followed by severe anxiety disorders, schizophrenia, severe depression and severe bipolar ­disorder.

The researchers found that a widely cited 2010 multinational study underestimated the economic burden of mental illness by not including premature death because of physical illnesses at the same time.

When these are incorporated, they comprise between 32 per cent and 53 per cent of the revised economic cost, the report finds.

Emergence of the report follows an investigation by The Australian last year that revealed patients of state mental health ­services were dying from preventable physical illnesses at an estimated average rate of 9000 excess deaths a year.

Another 3000 deaths in the same group have been estimated to result from suicide and other causes such as accidental death.

Early deaths from physical illness among people with mental disorders are considered to have multiple causes, including in­adequate physical healthcare, higher smoking rates, poorer diet and less physical activity.

Mental Health Australia chief Frank Quinlan said the report showed investment in prevention would save “very substantial amounts of money in addition to heading off a fair degree of human misery and suffering”.

Health economists cautioned that while assigning dollar values to disability adjusted life years is a commonly employed methodology, it is a contested technique in the field.

National Mental Health Commission chairman Allan Fels, an economist, defended the methodology and said the economic cost of mental illness had been underrated previously.

“The study shows that better policy on mental illness would bring large economic gains, larger than most of the reports being currently talked about in terms of tax and micro-economic reform and so on,” Professor Fels said. “The data is disturbing, particularly regarding the poor mortality rates of ­people with severe mental illness.’’

Menzies Centre for Health Policy researcher Lesley Russell said: “The economic case is just overwhelming, and if you don’t have compassion for the people, then care about the dollars.”

A Medibank Private report ­released in 2013 put direct and non-direct health spending on mental illness at $28.6bn.

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