Australia is in the midst of a mental health crisis.
At any given time, one in five of us will be experiencing mental ill-health and almost half of us will be affected by a mental health disorder.
Policy solutions are needed to address this crisis. It’s time our government considered bringing mental health into the Medicare system.
A publicly funded, universal mental healthcare system, or “Mentacare”, is not just good health policy — it’s also good economic management. A recent Productivity Commission draft report on our mental health system estimates that mental ill-health and suicide cost Australia approximately $130 billion every year, not taking into account the costs associated with broader social effects such as the stigma that can lead to lower social participation amongst those affected.
Despite government subsidies, the direct cost of seeking treatment is borne overwhelmingly by those affected by mental ill-health. The standard fee for a 45 to 60 minute consultation with an accredited psychologist is $251 per session. For the average Australian, that’s almost a quarter of their weekly wage.
For those who can afford private health insurance, psychiatric issues are in the top five reasons for hospital admissions claims, at an average cost of $13,000 per patient per night.
What should a public response look like?
Arguably, the best public mental health system would be one that replicated our existing public health system. When most people are, or suspect they are, experiencing a health problem, their first step is to go to their local doctor. GPs are the frontline of our health service, and they also represent the best frontline for a universal mental health service.
The fact that GPs are already treating a significant number of mental health disorders is a strong indication that primary care would be a good place to start investing in a Mentacare approach.
GPs already treat almost a third of people affected by mental ill-health, yet in 2018 funding for GPs accounted for less than 9% of all state and federal health spending combined.
The Royal Australian College of General Practitioners has called for greater government investment in the training and support that GPs receive relating to mental health. This would involve a reassessment of the time it takes to consult with patients presenting with mental health conditions, increased funding for mental health consultations, and a “no-wrong-door” approach, where a patient is accepted regardless of inclusion criteria.
The next step would be to invest in the psychological workforce. In 2018 there were 35,906 registered psychologists in Australia. Given that 3.8 million Australians are affected by mental ill-health every year, that means that there is one psychologist for every 106 people suffering from a mental health disorder.
This is why the mental health workforce is advocating for a significant increase in graduate positions and funding. Additionally, it stresses the importance of mental health educators, peer support workers and other non-clinical mental health professionals. While acute mental health services, like the hospital wards that treat people experiencing severe crises or psychosis, are stretched to breaking point, many of the pressures could be relieved by investing in non-clinical healthcare workers.
How much would it cost?
Starting with primary care, the government currently spends $10 billion a year on general practice and related services. A conservative estimate of the funding needed to support GPs to accommodate a greater share of mental health provision would be an increase of 40%, or an additional $4 billion.
Fully funding 50,000 psychologists across the country at an average salary of $73,814 a year plus superannuation, leave and administration provisions would cost an additional $5 billion.
While $9 billion is a lot of money, it’s worth putting it in context. In 2019-20 the government will spend approximately $7.2 billion subsidising fuel costs for multinational mining companies.
Additionally, the government is already spending approximately $1.2 billion a year on the current mental health plan subsidisation, which would be incorporated into the new spend, reducing that figure to $7.8 billion in new investment.
It’s also worth remembering that the overall societal cost of mental health is $130 billion a year, so every dollar spent on primary care has the potential to drastically reduce the overall cost of mental health.
More importantly, bringing mental health services into our existing universal healthcare system would not only remove the financial burden from those experiencing mental ill-health, but allow for a root and branch review of the system.
It would allow mental health education, prevention and treatment to become embedded into our lives, and reduce the stigma associated with seeking treatment. By fully funding mental health care and bringing our mental health system into public hands we have an opportunity to not only decrease the incidences of mental ill-health and suicide, but to reduce the associated costs.
For anyone seeking help, Lifeline is on 13 11 14 and Beyond Blue is 1300 22 4636.
Shirley Jackson is the Senior Economist at Per Capita.
An interesting proposition, which I have only seen as a bald assertion without detailed supporting evidence, is that this crisis is largely one of the costs of neoliberalism due to a sense of futility and helplessness which it engenders.
What a load of crap-I’m at the stage whenever an economist writes anything about a specialised topic they don’t know what they’re talking about you know it is going to be completely wrong. It defies common sense to state that in the population of 25 million “almost half the population” 12.5 million are mentally sick. Should we ask China for foreign aid ? Since the 1800s it has been stated “All the world is queer save thee and me, and even thou art a little queer.”
There is no crisis in mental health the crisis is that so much money is wasted on it. Mental health is covered under Medicare. It also defies common sense that of the mental health costs $130 billion – the defence budget is $38 Billion – social security welfare – newstart etc budget is $191 billion. If mental health costs Australia $130 billion then we are incorrectly assigning costs to mental health. The rest of the article treats $130 billion as a fact – not as as supposition what it really started out as.
Until medicare benefits became payable for psychologists there were about 10,000 clinical psychologists in Australia following the introduction of medicare benefits – then within 9 months there were around 40,000. The budgeted expenditure for the first year was completely exhausted in 4 months. Now we have this article by an economist calling for greater costs. Was there a sudden epidemic of insanity or did the demand expand to fill the financial manna from Medicare heaven?
Acute mental reasons are in the top five reasons for hospital admissions – yes most psychosis is triggered by recreational drugs. The university factories do not need to ramp up the production output of more psychologists. What urgently Australia needs is the increased number of ecologists, environmental scientists and Land care graduates. Governments need to address the social problems and the mental health needs will look after themselves. We in Australia are 30+ years behind the USA when the flowering of psychologists peaked and then dissipated – a flourishing economy is the best for mental health not a government financed mental health enclave in health care. We won’t have enough money left after NDIS anyway.
If you find the comment stressful Lifeline is on 13 11 14 and Beyond Blue is 1300 22 4636.
Yes, as Eric and Desmond say, if our political class had not sold out our younger generations would there be such a mental health epidemic?
The question that needs investigating is ‘Why so much mental ill-health’?
I definitely think it is a measure to adopt. A recently released book,”UTOPIA for REALISTS” by Rutger Bregman, demonstrates the extent to which homelessness, for example, actually costs the government. Compared to the cost of providing housing, homelessness, what with social issues, police ,welfare costs etc can cost many times more. A UK example demonstrated a saving in the tens of thousands of pounds compared a cost of only ₤3000.. The other spin offs were there to see as well, a rise in self respect, getting work and improvements in health. This could all apply to the mentally ill.