Social Determinants

Mental Health Inequities Could Cost $1.3 Trillion in 2040. How Can the Industry Prevent This?

Mental health inequities are costing the U.S. $477.5 billion annually. This could rise to $1.3 trillion in 2040 if left unaddressed.

The U.S. is spending about $477.5 billion annually in unnecessary expenses related to mental health inequities, according to a recent report from Deloitte and the Meharry School of Global Health. If left unaddressed, this could increase to $1.3 trillion in 2040. The cumulative cost from 2024 to 2040 would equal $14 trillion.

But there are steps the healthcare industry can take to improve mental health in the U.S. and lower associated costs. This includes integrating mental health and primary care and incentivizing mental health screenings.

“If we do this, what really matters at the end of the day for us is that we are able to increase longevity and increase life expectancy here in the United States,” said Daniel Dawes, founding dean of the School of Global Health at Meharry Medical College, in an interview. “And if we did all this, American health spans, which is the number of health years between birth and death, could be expanded by another 20 years on average. We could then also see a drop in health spending by 2040. That’s if we fully embrace wellness and prevention.”

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The findings

The report analyzed data from Komodo’s Healthcare Map, the Medical Expenditure Panel Survey from the Agency for Healthcare Research and Quality, the CDC’s WONDER database and the CDC’s National Hospital Ambulatory Medical Care Survey. It looked at four types of costs related to mental health inequities:

  • Chronic physical health conditions associated with mental health inequities
  • Medical expenditures related to mental health conditions that led to avoidable emergency department utilization
  • Productivity loss in the workforce from mental health challenges
  • Economic costs from deaths due to suicide, substance use disorders, inadequate mental health treatment and mental illness related to comorbid illnesses

The researchers found that the cost of treating chronic physical health conditions related to mental health inequities is expected to increase to $76 billion in 2040 from $23.9 billion in 2024. Those with mental health conditions have a higher prevalence of chronic diseases, particularly among lower-income individuals.  

“Often mental health may be the invisible accelerant to worsening chronic care because if you have mental health inequities that are undertreated or untreated, then it’s harder to manage the chronic conditions that an individual may be grappling with,” said Jay Bhatt, managing director of the Deloitte Center for Health Solutions and Health Equity Institute, in an interview.

In addition, emergency department utilization costs related to mental health inequities are expected to rise to $17.5 billion in 2040 from $5.3 billion in 2024. When patients don’t have adequate access to primary care or a behavioral health specialist, they are more likely to seek care from the emergency department, the report noted.

When it comes to productivity loss in the workplace due to mental health inequities, the researchers looked at unemployment, absenteeism and presenteeism. Absenteeism is when workers have to take more sick days because of mental health challenges, while presenteeism is when employees come to work but aren’t fully productive. In total, the cost of productivity losses due to mental health inequities is expected to reach $252.3 billion in 2040 compared to $116 billion in 2024.

The projected cost of premature deaths, such as from suicide or substance use, due to mental health inequities is anticipated to reach $911.9 billion in 2040 from $332.2 billion in 2024 if left unaddressed, the report also showed.

“That is extremely frightening,” Dawes said. “I hope that number actually shakes the conscience of our policymakers and our employers around the country whose employees are struggling with mental health issues every single day.”

The researchers also found that while the White population has the highest prevalence of mental health conditions, non-White populations experience more cost burden from mental health challenges. For example, non-White Americans are generally more likely to be uninsured and therefore, will have to pay more out of pocket for mental health services, Dawes said. They’re also more likely to live in medical deserts and have less access to behavioral health specialists. This increases the likelihood of going to the emergency department for mental health care.

“This is likely due to the long-standing structural racism and the legacy of policies that disadvantage certain populations, as well as social and economic conditions,” the report said.

What can be done

The inequities and costs from mental health are stark, but they can be avoided if key stakeholders take action. They include academia, medicine and public health entities, employers, elected officials and local governance, according to the report.

One of the biggest challenges that needs to be addressed is access, according to Bhatt. This could come in numerous forms, including improving the network of providers and clinicians that individuals have access to, providing transportation support and using digital methods. When it comes to the latter, there needs to be adequate internet and broadband access.

Both Bhatt and Dawes noted that there is a shortage of mental health providers, which is making it harder to access care. One way to address this is through integrating behavioral health care and primary care, they said.

Another industry executive agreed with this solution.

“Primary care physicians are extremely well positioned to help solve these mental health inequities,” said Dr. Geoffrey W. Rutledge, co-founder and chief medical officer of virtual primary care company HealthTap. “Not only do they manage the most common mental and behavioral health conditions, from anxiety and insomnia to depression and substance use disorder, but they also are experts at preventing and managing the chronic health conditions that are more common in those with mental and behavioral health challenges.”

From a policy standpoint, Congress and policymakers should “continue to strengthen and enforce mental health parity provisions to ensure better coverage for mental health treatments and incentivize regular mental health screenings,” Dawes said. 

Government agencies should also look at existing reimbursement and coverage policies that may “create unintended barriers to treatment,” he added. For example, 40% of the nonelderly adult Medicaid population had a mental health or substance use disorder in 2020, according to KFF. But the Medicaid program is “woefully underfunded,” making it difficult for beneficiaries to access care, Dawes said.

According to Dr. Sarah Oreck, CEO and co-founder of maternal mental health company Mavida Health, the focus should not be on how to reduce the cost of mental health inequities, but the actual inequities themselves. 

“How can we do more to provide access to care for those who need it most — socially, politically and economically? How can we prioritize care for the most impacted?” Oreck said in an email. “We can and must do more to engage historically disadvantaged populations into mental health care during pivotal transition points that already bring people into healthcare.” This includes during the maternal health phase, Oreck noted.

Ultimately, efforts have to be made by multiple sectors in order to improve mental healthcare in the U.S.

“The mental health crisis in the United States should be treated as an emergency encompassing a cross-sector approach,” the report stated. “Progress should include the active and voluntary participation of the private and commercialized industries that directly or indirectly affect the service and delivery of mental health services.”

Photo: SIphotography, Getty Images