1. Mental health and economics
Current activities:
Director of PSSRU
Director of LSE Health
Professor, health economics KCL
Director of NIHR SSCR
Current research areas:
Depression, psychosis
Dementia
Stroke
Telehealth/telecare
Long-term (social) care
Child mental health; wellbeing
Genetic testing (economics of)
Autism
Intellectual disability
Carers
Community capital building
Prevention
Inequalities
Mental health and economics
Martin Knapp
London School of Economics and Political Science
King’s College London, Institute of Psychiatry
NIHR School for Social Care Research

2. A
Mental health 2

3. Prevalence of mental health problems – working age population (UK)
Symptom-free  64%
Severe mental illness (schizophrenia, bipolar disorder, serious depression)  1%-2%
Common mental disorders: symptoms that reach threshold for diagnosis  17%
Symptoms (sleep problems, fatigue, worry, but no disorder  17% 3

4. Years lost to disability (men) - globally
All Causes
Total YLD (millions)
% of total
1. Unipolar major depression
20.35
7.7
2. Hearing Loss, adult onset
14.96
5.6
3. Cataracts
12.16
4.6
4. Alcohol use
11.5
4.3
5. Cerebrovascular disease
7.58
3.1
6. Vision related disorders
7.23
2.7
7. Peri-natal conditions
7.03
8. Osteoarthritis
6.59
2.5
9. Chronic Obstructive Pulmonary Disorder
6.55
10. Schizophrenia
5.66
2.1
By Depression (unipolar major)to account for largest disability burden
Depression is 4th in terms of DALYs
Disease Control Priority Project 2006,

5. Years lost to disability (women)
All Causes
Total YLD (millions)
% of total
1. Unipolar major depression
31.26
11.0
2. Cataracts
16.49
5.8
3. Hearing Loss
15.03
5.3
4. Osteoarthritis
10.83
3.8
5. Vision related disorders
9.66
3.4
6. Alzheimers & other dementia
9.46
3.3
7. Cerebrovascular disease
6.98
2.5
8. Perinatal conditions
6.91
2.4
9. Schizophrenia
5.58
2.0
10. Bi-Polar Disorder
4.82
1.7
By Depression (unipolar major)to account for largest disability burden
Depression is 4th in terms of DALYs
Disease Control Priority Project 2006,

6. N of people by disorder, England 2007 & 2026
Current & projected future prevalence
N of people by disorder, England 2007 & 2026
McCrone, Dhanasiri, Patel, Knapp, Lawton-Smith, Paying the Price, King’s Fund, 2008

7. Projected number of people with dementia in the UK: 2005-2029
Source: Knapp et al (2007) Dementia UK report

8. Characteristics of mental health …
High prevalence
Chronic course
Genes / environment
Multiple needs
Employment effects
Links to suicide / self-harm
Compulsory treatment / detention
Stigma & discrimination
Family impacts
Antisocial behaviour, crime
Mental well-being / happiness

9. … with economic consequences
High prevalence  high expenditure
Chronic course  lifelong economic impacts
Genes/environment  complex causality
Multiple needs  wide-ranging costs
Employment effects  productivity losses
Links to suicide/self-harm  fear/costs etc
Compulsory treatment  user choice?
Stigma & discrimination  social exclusion
Family impacts  often hidden; incentives?
Crime  exaggerated societal reactions?
Mental well-being  links to happiness

10. Leading mental health policy themes
Wider NHS and social care structures - financing; commissioning; competition … few MH-specific issues.
Coordination - getting health and other systems to work together more effectively and efficiently
Prevention of mental illness; and promotion of mental wellbeing.
Early intervention – life-course perspectives etc
Roles of hospitals (and other institutions) - appropriate housing support; community care
Personalisation – responding to individual needs and preferences; hence personal budgets etc
Employment, including welfare payments, absenteeism, presenteeism
Social inclusion – rights, opportunities, participation etc
Equity – vicious cycle linking deprivation to morbidity
Ageing and implications for not just dementia but also psychoses, depression
Stigma and discrimination (at the root of many challenges?) 10

11. B
Economic questions 11

12. Example: Treatments for depression …
Interventions
Antidepressant medication
CBT
Primary care counselling
Interpersonal psychotherapy
Couple therapy 12

13. … could lead to better outcomes …
Interventions
Antidepressant medication
CBT
Primary care counselling
Interpersonal psychotherapy
Couple therapy
Outcomes
Symptom alleviation
Interpersonal functioning
Social functioning
Employment
Quality of life 13

14. … and lower longer-term costs.
Interventions
Antidepressant medication
CBT
Primary care counselling
Interpersonal psychotherapy
Couple therapy
Outcomes
Symptom alleviation
Interpersonal functioning
Social functioning
Employment
Quality of life
Cost savings
Lower use of health and social care services
Fewer out-of-pocket expenses
Greater economic productivity
Higher income 14

15. Question 1: What does it cost?
Interventions
Antidepressant medication
CBT
Primary care counselling
Interpersonal psychotherapy
Couple therapy
Outcomes
Symptom alleviation
Interpersonal functioning
Social functioning
Employment
Quality of life
Cost savings
Lower use of health and social care services
Fewer out-of-pocket expenses
Greater economic productivity
Higher income
1. Costs ? 15

16. Question 2: Will it pay for itself?
Interventions
Antidepressant medication
CBT
Primary care counselling
Interpersonal psychotherapy
Couple therapy
Outcomes
Symptom alleviation
Interpersonal functioning
Social functioning
Employment
Quality of life
Cost savings
Lower use of health and social care services
Fewer out-of-pocket expenses
Greater economic productivity
Higher income
1. Costs ?
2. Cost-offsets ? 16

17. Question 3: Is it worth it?
Interventions
Antidepressant medication
CBT
Primary care counselling
Interpersonal psychotherapy
Couple therapy
Outcomes
Symptom alleviation
Interpersonal functioning
Social functioning
Employment
Quality of life
Cost savings
Lower use of health and social care services
Fewer out-of-pocket expenses
Greater economic productivity
Higher income
1. Costs ?
3. Cost-effectiveness ?
2. Cost-offsets ? 17

18. Question 4: Can we change things?
4. Incentives ?
Interventions
Antidepressant medication
CBT
Primary care counselling
Interpersonal psychotherapy
Couple therapy
4. Incentives?
Outcomes
Symptom alleviation
Interpersonal functioning
Social functioning
Employment
Quality of life
Cost savings
Lower use of health and social care services
Fewer out-of-pocket expenses
Greater economic productivity
Higher income
1. Costs ?
3. Cost-effectiveness ?
2. Cost-offsets ? 18

19. B
Costs 19

20. Many causes; widespread impacts
Genes
Health care
Family
Social care
Income
Housing
Long-term needs
Emply’t
Education
Resilience
Crim justice
Trauma
Benefits
Phys env
Employment
Events
Vol sector
Chance
Income
Mortality

21. …on many different budgets (England)
Genes
Health care
NHS
Family
Social care
LAs
CLG
Income
Housing
Long-term needs
Emply’t
Education
DfE
Resilience
Crim justice
MoJ
Trauma
Benefits
DWP
Phys env
Employment
Firms
Events
Vol sector
CVOs
Chance
Income
Indiv
Mortality
All

22. Expenditure projections for people with dementia 2002 to 2031
Projected total LTC expenditure, at 2002 prices
LTC expenditure as % of Gross Domestic Product
Red – older people with cognitive impairment; Blue - not
Comas-Herrera et al, IJGP 2007 22

23. Depression – costs for adults in England, 2000
Excluding ‘morbidity’ costs
Thomas & Morris Brit J Psychiatry 2003 23

24. Depression – costs for adults in England, 2000 - continued
Total cost = £9 bn
Thomas & Morris Brit J Psychiatry 2003 24

25. GB - employment and mental health
% in full-time work

26. GB - disability benefits, 2007
€ 3.9 billion per annum
Plus reduced tax receipts €14 billion
Department of Work and Pensions, 2007

27. Costs of health service use by diabetes patients, by depression severity
Number of reported diabetes complications 1 2 3 1 2 3 1 2 3
Simon et al, Gen Hosp Psychiatry, 2005

28. Costs - young children with persistent antisocial behaviour
Total cost excluding benefits averaged £5,960 per child per year, at 2000/01 prices (benefits = £4307)
Romeo, Knapp, Scott (2009). Children with antisocial behaviour. British J Psychiatry 188:

29. Evidence from the Inner London Longitudinal Study
All 10-year olds in a London borough, 1970 (n=1689). Led by Michael Rutter at that time
Teacher ratings, child questionnaires
Intensively studied 50% of children with psychological problems and random 8% of others
At age 10:
No problems at school, no clinical diagnosis (65)
Antisocial behaviour at school, only (61)
Conduct disorder (16)
Emotional problems at school, only (32)
Emotional disorder (8)
Followed up at age …
Research question: What services were used and what costs incurred between aged 10 and 28?

30. Costs in early adulthood linked to childhood antisocial behaviour
Costs (£) from ages 10 to 28
Scott, Knapp, Henderson, Maughan (2001) Financial cost of social exclusion: follow-up study of antisocial children into adulthood. Brit Med J 323:

31. C
Cost-offsets 31

32. Check report for full details
New economic evidence on mental health promotion and mental illness prevention
Check report for full details

33. Our approach - 1
Aim - model the costs and economic pay-offs of initiatives to prevent mental illness and promote mental well-being.
Looked at evidence-based mental health interventions (incl. non-NHS) – must have well-established outcomes
Looked at 15 different areas and interventions
Used simple decision analytic modelling
Close liaison with DH officials; consultation with experts
As far as the robust evidence base allows:
Included promotion, primary, secondary prevention
Looked at widest range of economic impacts
Estimated impacts over long time periods
If in doubt, we adopted conservative estimates 33

34. Our approach - 2 Examined interventions from 2 perspectives:
- pay-offs to society as a whole and
- cash savings to the public sector
And interested particularly in the timing of impacts and whether (or when) ‘cashable’
Over and above the economic pay-offs there are health and QOL benefits to individual patients
Important to note that …
These are simple, partial and incomplete models
Findings are not definitive: they provide a platform for discussion (hence publication on DH website and linked elsewhere)
Interventions modelled are not necessarily the only ones that are economically attractive
BUT every intervention has ‘proven’ health/wellbeing benefits 34

35. Debt: mental health challenges
Prevalence of mental health problems
45% of people in debt have mental health problems compared with 14% not in debt
Incidence of mental health problems
Developing unmanageable debt is associated with an 8.4% risk of mental health problems compared to 6.3% for people without financial problems
Specific conditions
Alcoholism (2x), Drug Addition (4x), Suicidal ideation (2x)
Source: Fitch et al, submitted; Meltzer, et al., 2010; Skapinakis et al., 2006;

36. Debt counselling: the economic case
Target
General population without mental health problems who are at risk of unmanageable debt
Inter-vention
Debt advice services, provided on face-to-face, telephone or internet basis
Outcome evidence
Unmanageable debt increases risk of developing depression/anxiety disorders by 2% in general population. Face-to-face service alleviates 56% of unmanageable debt; telephone service alleviates 47%.
Economic pay-offs
Reductions in: health and social care service use; lost employment; legal system costs; costs to local economy
Findings
Complicated …! Savings depend on who pays, mode of delivery, and amount of debt recovered. Telephone/web advice cost saving (most scenarios). Face-to-face advice most cost-effective. If 2/3 of service costs recovered from creditors, then total savings = £0.63 per £1 invested in first year; and £3.55 over 5 years.
Knapp et al (2011) in Knapp et al Mental Health Promotion…, Dept of Health. 36

37. Medically unexplained symptoms: the economic case
Target
Individuals with sub-threshold somatisation and clinical somatisation disorders in primary care (account for c. 25% of all primary care consulters)
Inter-vention
Referral to 10 sessions of cognitive behavioural therapy over 6-month period; cost = £400
Outcome evidence
CBT shown effective in reviews; 35% of individuals report improvement in symptoms after 15-month follow-up (Allen et al 2006)
Economic pay-offs
Reduced NHS costs (GP consultations, prescriptions, A&E, outpatients, inpatients); reduced sickness absence from work
Findings
Total savings over 3 years = £1.75 per £1 invested for comprehensive programme; savings = £7.82 per £1 invested for targeted programme. Majority of savings accrue to NHS
McDaid et al (2011) in Knapp et al Mental Health Promotion…, Dept of Health. 37 37

38. Early detection of psychosis: the economic case
Target
Young people aged in general population with prodromal symptoms of psychosis. Estimated number per year = 15,763.
Inter-vention
Early detection service (based on OASIS in South London; Valmaggia et al 2009). Consists of psychological and pharmacological treatment.
Outcome evidence
Reduced rate of transition to full psychosis and reduced duration of untreated psychosis for those who do develop it.
Economic pay-offs
Reduction in inpatient costs and lost employment, reduction in homicide rate, reduction in suicide rate.
Findings
In short-term (Year 1) there is a net cost, but the total return on £1 investment over a 10-year period is £10.27 – 26% of this is to the NHS
McCrone et al (2011) in Knapp et al Mental Health Promotion…, Dept of Health. 38

39. Economic pay-offs per £1 investment
NHS
Other public sector
Non-public sector
Total
Early identification and intervention as soon as mental disorder arises
Early intervention for conduct disorder
1.08
1.78
5.03
7.89
Health visitor interventions to reduce postnatal depression
0.40 -
0.80
Early intervention for depression in diabetes
0.19
0.14
0.33
Early intervention for medically unexplained symptoms
1.01
0.74
1.75
Early diagnosis and treatment of depression at work
0.51
4.52
Early detection of psychosis
2.62
0.79
6.85
10.27
Early intervention in psychosis
9.68
0.27
8.02
17.97
Screening for alcohol misuse
2.24
0.93
8.57
11.75
Suicide training courses provided to all GPs
0.08
0.05
43.86
43.99
Suicide prevention through bridge safety barriers
1.31
51.39
54.45
Promotion of mental health and prevention of mental disorder
Prevention of conduct disorder through social and emotional learning programmes
9.42
17.02
57.29
83.73
School-based interventions to reduce bullying
14.35
Workplace health promotion programmes
9.69
Addressing social determinants and consequences of mental disorder
Debt advice services
0.34
0.58
2.63
3.55
Befriending for older adults
0.44

40. D
Cost-effectiveness 40

41. ‘Is it worth it?’ ‘Does this intervention work?’ Cost-effectiveness
If the core clinical/care question is:
‘Does this intervention work?’
Then the economic question is:
‘Is it worth it?’

42. Which outcome dimensions?
Symptoms of illness
Extent of disability
Needs (met, unmet)
Social functioning
Self-care abilities
Employment, occupation, activities
Behavioural characteristics
Quality of life
Normalised lifestyle
Autonomy, choice, control
Family well-being
Carer ‘impact’
Societal perceptions (e.g. safety)
QALYs (quality-adjusted life years)
Characteristics of a good outcome measure:
Relevant!
Reliable
Valid
Sensitive to change
Succinct
Acceptable to patient 42

43. How are the outcomes traded-off against the costs?
C = costs
E = effects
1 = old treatment
2 = new treatment
Possible CEA results
C2 > C1
New treatment less effective and more costly
How are the outcomes traded-off against the costs?
New treatment more effective but also more costly
E2 < E1
E2 > E1
New treatment less effective but less costly
New treatment more effective and also less costly
C2 < C1

44. Trade-offs … is it worth it?
If an intervention is more effective and also more costly, then calculate the cost per unit gain in effectiveness. Crunch question: Is it worth it?
So we could:
Attach a monetary value to the outcome gain
Show decision-maker the cost-effectiveness of various ways to spend their money and get them to choose
Show decision-maker the probability of cost-effectiveness at different WTP values
… or ask them how much they are willing to pay?
Set a threshold, rigidly or as a guide (cf. NICE) …
… But then need a way to compare across different diagnostic groups) … and hence use of QALYs, DALYs

45. Cost-effectiveness acceptability curve (CEAC)
1.0
0.9
0.8
0.7
0.6
0.5
Probability of being cost-effective
0.4
0.3
0.2
0.1
€10k
€20k
€30k
€40k
Value of threshold ratio

46. Computerised Cognitive Behavioural Therapy (CBT) for anxiety and depression
Design n=274 primary care patients (aged 18-75) with depression and/or anxiety disorder; not currently receiving face-to-face psychological therapy. RCT
Interventions ‘Beating the Blues’ (BtB) – 8 sessions (50 mins each) of therapy on top of usual care vs. treatment as usual (TAU) alone (discussions with GP, referral to counsellor, practice nurse or MH professional, etc)
Aim To compare effectiveness and cost-effectiveness of BtB and TAU
Example
Proudfoot et al, Brit J Psychiatry 2004; McCrone et al, Brit J Psychiatry, 2004 46

47. Beating the Blues: results
Effectiveness
BtB better than treatment as usual on clinical measures of symptoms (Beck Depression Inventory, Beck Anxiety Inventory) and functioning (Work and Social Adjustment Schedule)
Cost
BtB more costly than standard care (to NHS)
So is it worth it?
Cost per 1 incremental gain on Beck Depression Inventory = £21
Cost per additional depression-free day = £2.50
Cost per additional QALY = £2190
Proudfoot et al, Brit J Psychiatry 2004; McCrone et al, Brit J Psychiatry, 2004 47

48. E
Incentives 48

49. Using economic incentives
Providing information about what people do and the associated economic consequences
Rewarding/penalising decision-makers for ‘good/bad decisions’ or good/bad performance
Hence:
Fee for service … the GP contract
Payment by results (HRGs)
Incentive-based contracts / salaries
Provider competition within health / social care
Financial rewards for patients (e.g. FIAT)

50. Thank you