Does mental ill health cost £105 billion a year?

“...the cost of mental ill health to the economy, the NHS and society as a whole is £105 billion a year”

Department of Health, 15 February 2016

This estimate comes from research by the charity Centre for Mental Health (CMH) in 2009/10. It’s not entirely accurate to describe it simply as the cost to the economy, the NHS and society as a whole, as that misses out that about half of it—£54 billion—is an estimate of the cost to individuals’ quality of life as a result of having mental health difficulties.

Estimates of this kind are always uncertain, and rest on a number of assumptions—most notably in this case, regarding the monetary value of a healthy year of life.   

About half of the £105 billion refers to costs to individuals

CMH’s estimate, which refers to costs in England, is made up of the following:

• £21.3 billion cost of health and social care

This includes not only the cost of providing NHS and local authority health and social care services, but the cost of welfare benefits, and the cost of informal care provided by family and friends.

• £30.3 billion cost of the loss of output

This includes the cost of lost productivity due to sickness absence, lost productivity and working hours due to people with mental health problems not being in work, and lost productivity at home, such as housework.

• £53.6 billion human cost

This provides a monetary value for the cost of the reduction in people’s quality of life caused by mental illness.

The figure depends on how you count the monetary value of intangible costs

CMH said of its estimates when it first compiled them in 2003 that:

“The provisional nature of these estimates should be emphasised, particularly in the case of human costs where the figures are based on assumptions and data sources which are very much open to improvement in future work.”

What value would you put on one year of healthy life? That’s exactly the question that the researchers compiling these estimates had to get an answer to. In its earlier cost estimate put together by the charity back in 2003, CMH used a figure of £30,000. This was uprated in line with inflation for its 2010 analysis.

It said there was reason to think this was a fair estimate, saying for example that it was the threshold used by health regulator the National Institute for Health and Care Excellence to judge whether interventions were cost-effective, but it stressed the evidence behind it was “far from secure”.

This isn’t the only type of intangible cost that the researchers have attempted to put a figure on.

For example, there’s also unpaid support given by family and friends. CMH’s earlier research discusses whether this should be valued at the same cost as residential care, or whether family and friends might incur greater costs. For instance, if they’re not benefitting from the savings associated with providing a service at scale.

Probably the biggest difficulty in calculating the cost of mental health problems is that we still don’t really know how many people have mental health problems. People have different opinions of what’s a mental health problem and what’s not, and not everyone with mental health difficulties come into contact with relevant services.  

CMH points out it hasn’t included all potential costs. For example, it excludes the costs of “presenteeism”—the losses in productivity from functioning at a lower capacity than usual due to health problems.