The Concealed Costs of Mental Illness, How to Uncover and Eradicate Them Katherine Gallagher

Behavioral Economics

Professor Schulz

December 7, 2015

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In the United States, almost every one in two people will suffer from depression,

anxiety disorders or another mental ailment at some point in their life (Scientific

American). Mental health is a global issue that is costly for all countries, not just the

U.S. Mental health has no prejudices; it affects people of every race, ethnicity, religion,

age and socioeconomic status. Some people however are more prone to the illness than

others. There is no argument that mental illness has a profound affect on the economy. It

is a problem that must be addressed using some form of intervention. There are many

different practices taking place around the world in an attempt to reduce the direct and

indirect costs of mental illness. The best course of action, however, is yet to be

determined.

The scale of the costs created by mental health issues is astounding. “It accounts

for over��� 15% of the disease burden in developed countries, which is more than the

disease burden caused by all cancers” (Cyhlarova, et al.). In order to discuss the

magnitude of the burden accrued by mental health cost; one must first understand the

measures of mental illness costs. There are two types of direct consequences of

production lost because of mental health: absenteeism and presenteeism. Absenteeism is

when people call off of work due to illness. In the UK, self-reported depression is the

most important cause of absenteeism. This means that people call off work mostly

because they are dealing with depression rather than physical illness. This amounts to

£8.4bn in estimated cost of absence annually. Another factor of lost production is

presenteeism. Presenteeism is the idea that people come to work but are much less

productive because they are dealing with illness. They estimate that this amounts to

£15.1bn for reduced productivity when at work (Cyhlarova). In Canada, these costs

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amount to $6 billion annually (Lopez-Pacheco). In a study conducted in Alberta, they

found that 8.2% of workers in the study were getting treatment for mental illness, but

38.8% had a diagnosable disease (including anxiety, major depression, phobias and

antisocial personality disorder) and were in need of treatment. Leaving these people

without treatment has compounding affects on the economy. “Nationwide, there is an

annual cost of $193.2 billion in lost earnings due to mental health conditions, not

including the many hidden and indirect costs associated with poor mental health”

(Bethea).

There are additional costs due to untreated mental illness, but many of them are

immeasurable. People that struggle with mental health are much less efficient than

people that are emotionally stable. Individuals struggling with mental health are much

less likely to complete school and will therefore earn lower wages if and when they do

enter the labor force. People that have lower earnings or are unemployed have difficulty

seeking and affording sufficient mental healthcare, usually worsening their symptoms

(Bethea). This creates a vicious cycle in which one can never leave because he or she is

too mentally ill. People living below the poverty line are already at a disadvantage when

it comes to mental health; about every one in six adults living just above the poverty line

or lower has severe mental illness. These individuals have difficulty finding and keeping

a job and they do not qualify for disability so they receive no mental healthcare. “A

recent large study in California found that only 32 percent of uninsured residents with

mental illnesses received any treatment at all and that less than 12 percent got adequate

help” (Scientific American). Left untreated, mental health issues can manifest into

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trouble with addiction, substance abuse and physical ailments creating even more

unforeseen costs.

Mental illnesses often manifest themselves before people enter the workforce.

NAMI on campus states that 1 in 5 students have a mental health condition in college,

usually presenting for the first time leaving students unequipped to deal with these issues

in their new environment full of new people and experiences. This is not a small

percentage of people about to enter the job market that will be less efficient because of

their mental illnesses. Suicide is one of the top 15 killers in America for adults and in the

top 3 for teens and children. 90 percent of suicide cases can be attributed to mental

illness (Scientific American). Many children, even younger than college age, also suffer

from mental illness but are rarely treated effectively. Little funding is being allocated for

research of illnesses amongst children.

The best way to diminish the mental health costs is to find an acceptable

intervention. All round the world, countries are searching for the most efficient

intervention. According to the Scientific American, “By 2002, 29 states had mandated

that health insurance packages cover mental illness on the same terms as physical illness,

and in those states the suicide rate fell by an average of 5 percent.” Already the

interventions were successful and with more funding for research the results can improve

dramatically.

Some believe that specific interventions within the community and healthcare

sectors will solve the issues of mental health. By encouraging health professionals to

diagnose patients early, patients begin to receive the care the need before they have

spiraled into the vicious cycle from which they can never return. If the providers

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coordinate with social programs like homeless shelters and food pantries, perhaps they

can help the people living below the poverty line to get them back on track. Another way

to help low income patients would be to create community health centers in areas with

high rates of mental illness, but that still may not be enough to help everyone. The new

healthcare reforms-The Patient Protection and Affordable Care Act-that President Barack

Obama enacted in 2010 may be able to help with the lack of volume of care needed. The

new reform makes it mandatory that every insurance plan has “behavioral health”

coverage. This includes mental health and addiction and substance abuse help, as an

“essential health benefit.” This program allows 3.7 million Americans to receive new

benefits involving mental health in 2014 that they were not receiving before (Scientific

American). The new healthcare plan seems to be helpful in giving mental healthcare to

people that did not have any care before. However, of the people that already had the

option of care, this plan does not affect their situation much. Still more needs to be done.

If we can discover a way to track mental health progress after interventions, perhaps we

would be able to target the best intervention. Overall, the world needs to spread mental

health awareness and reduce stigma so that people can begin to receive care for illnesses

in an attempt to prevent severe issues in the future.

Modifications to the workplace environment and healthcare from employers have

been proven to be effective interventions. The Financial Post found that costs to firms

decreased by 15-33% when mental health issues were addressed by specific

interventions. Aside from lowering costs, interventions can improve happiness,

productivity, moral and long term benefits within a company. “Researchers at the Centre

for Applied Research in Mental Health and Addiction (CARMHA) have identified 13

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psychosocial risk factors that can lead to an unhealthy, high-stress environment, which is

to mental health what hazardous and unsafe workplaces were in the past to physical

health. These factors include the way deadlines, workloads and work methods are

handled, as well as the context in which work occurs, including relationships and

interactions with managers and supervisors, co-workers and customers” (Lopez-

Pacheco). By altering behaviors in each individual company, we can allow every

individual to have a more positive work experience. This is not enough to solve the

problem of mental illness, but it is definitely a helpful beginning.

Another way to cut economic burden from mental health is to deal with the root

of some problems first, that is, to start with children. Nearly 6% of adolescents and

young adults have conduct disorder. “Conduct disorder is a repetitive and persistent

pattern of behavior in children and adolescents in which the rights of others or basic

social rules are violated. The child or adolescent usually exhibits these behavior patterns

in a variety of settings—at home, at school, and in social situations—and they cause

significant impairment in his or her social, academic, and family functioning” (Mental

Health America). Of children diagnosed with conduct disorder, 30% end up committing

a crime sometime in their life, costing 22 billion pounds a year. “In a case study of

conduct disorders it was estimated that preventing conduct disorders in the most

disturbed children would save around £150,000 of life time costs per case (i.e. £5.25

billion in the UK), and promoting positive mental health in children with moderate

mental health would yield lifetime benefits of around £75,000 per case (£23.625 billion

in the UK)” (Cyhlarova, et al.). A small cost to help improve treatment for children with

conduct disorder can save a country billions of dollars.

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Cyhlarova and colleagues also discovered that improving access to psychological

therapies for depression and anxiety and increasing investment in evidence-based

therapies would be effective intervention strategies. The cost of standard therapy is

relatively low but the pay offs are very high. They witnessed about a 50% recovery rate

in their study of people receiving therapies. The therapy virtually pays for itself in only a

few years. Therapy is such an effective treatment. Perhaps with more research they

would be able to apply these types of therapies to other mental illnesses and reduce costs

even further.

In an attempt to improve drug administration, researchers are trying to figure out

which type of drugs helps which people. This “prevents people from taking medications,

which are not the most effective, take longer to alleviate symptoms and cause severe side

effects” (Cyhlarova, et al.). They are conducting this research using the methods of

neuroimaging and genetics. In a study in the UK they found that certain markers in the

brain could be imaged and deciphered by the doctor to allocate which type of

antidepressant will be most effective for any individual. This innovation could lead to

fewer costs from trying to find a drug that works for a patient. The less time it takes to

find an effective drug, the sooner a patient can be back at work and productive again.

For any of these interventions to make their way into society, they must be proven

efficient. In order to do that, more research must be conducted. Currently, there is

disproportionality between the economic burden (cost) and funding for research to lessen

the burden. “In France the impact [of the burden] is 5.7% of GDP but budget for

research is less than 2% of health research even though mental health affects 20% of

population” (Cyhlarova, et al.). By funding more research the burden can be minimized

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dramatically. In the same study, they discovered that the rate of return on public or

charitable mental health research was 37%. That is an amazing return on investment, one

that economists should jump at. Funding research is the only way to cut mental

healthcare costs.

As someone that is newly entering the work force, I believe we need workplace

reform if we want people to continue being productive in their professions while

suffering from mental illnesses. In America there is a stigma for taking a day off from

work. Working people expect one another to work as much and as well as they can at all

times. We have an idea in our heads of the perfect professional that comes to work bright

and early in the morning, stays till after the sun goes down and is working like crazy the

entire time he or she is in the office. This is an unattainable goal for any working person

let alone someone suffering with mental illness. For people that struggle with anxiety

disorders, this high stress work situation is a nightmare. We need to change the story and

allow people to take the time off when they need to. Everybody needs a break some of

the time. Instead of working people until the breaking point, we should allow people to

take a day off to collect themselves every once in a while to keep their mental health in

check. If we do so, workers will come back to work more refreshed, productive and

overall happier. Companies also need to include mental healthcare into their health

insurance plans. Therapy is such an effective intervention. If employees had access to

the proper care, the company would make back the money it spent on the insurance in

fewer missed days of work for its employees let alone the definite increase in

productivity.

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The outrageous number of preventable suicides in young people is another

indicator that the mental healthcare system for children and college students needs to be

reformed. Children are not getting the attention and care that they need. When children

do not get the proper mental health care, they grow up to have even more difficulty, not

only with their disease, but also in all aspects of their lives. If children were screened

more thoroughly, perhaps the children will get the proper care that they need and lead a

healthier, more productive life.

Sometimes a mental health disorder will not present itself until later in a person’s

life, after adolescence. Many diseases present themselves after the age of 18. At this

age, young adults are usually going to college and moving away from home. These

students are experiencing drastic changes in their lives. The stress of all the new

experiences compounded by a new disorder is extremely challenging to deal with and one

they have never dealt with before, let alone by themselves. The best intervention that a

student can receive at this stage in their diagnosis and in this stage of their lives is

support. Most universities do not have the resources to help the one in five students that

suffer with mental illness. Universities need to allocate more funding for mental

healthcare: for counselors and support groups. 20% of the student body is afflicted, there

are students suffering that do not even know that they have options. Campuses need to

create more awareness of the resources that the college does have and make them more

accessible to the entire student body. Even if a college cannot afford to hire more trained

professionals to counsel students, they should set up student led support groups so that

students know they are not alone to deal with their illnesses.

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Mental health is a cost to the economy that can no longer be ignored. There are

many great ideas on how to deal with this problem, but little evidence to support the most

efficient option. The only way to find the answers to the mental health cost problem is to

fund more research. Once the most effective intervention is discovered, the entire mental

health system can be reformed to give the mentally ill the care they so desperately need.

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Works Cited Bethea, Brittaney Jewel. "Mental Health Conditions Negatively Affect Social and

Economic Opportunity | Newsroom | Washington University in St. Louis." Washington University in St. Louis. N.p., 16 Oct. 2013. Web. 09 Nov. 2015.

"Conduct Disorder." Mental Health America. N.p., n.d. Web. 08 Dec. 2015. Cyhlarova, Eva, Andrew McCulloch, Peter McGuffin, and Til Wykes. "Economic

Burden of Mental Illness Cannot Be Tackled without Research Investment." (n.d.): n. pag. Mental Health Foundation, Nov. 2010. Web. 9 Nov. 2015.

Lopez-Pacheco, Alexandra. "Mental Illness Adversely Affecting Canada's Economic Potential." Financial Post Mental Illness Adversely Affecting Canada’s Economic potential. Financial Post, 5 Feb. 2013. Web. 09 Nov. 2015.

"NAMI on Campus Because Mental Health Matters." NAMI: National Alliance on Mental Illness. Web. 09 Nov. 2015.

Steinke, Claudia, PhD, RN, and Ali Dastmalchian, PhD. "The Economic Impacts Workplace Mental Illness and Substance Use." Visions Journal 5.3 (2009): 6. The Economic Impacts. Web. 09 Nov. 2015.

The Editors. "The Neglect of Mental Illness Exacts a Huge Toll, Human and Economic." Scientific American Global RSS. N.p., 1 Mar. 2012. Web. 09 Nov. 2015.

Thompson, Angus H., Philip Jacobs, and Carolyn S. Dewa. The Alberta Survey of Addictive Behaviours and Mental Health in the Workforce: 2009. Tech. Alberta: Institute of Health Economics, 2011. Print.