2015-anz rural mental health

Mental Health in Rural Australia “Too Costly to Ignore”

John GreggBComm (ECU), Grad Dip Econ (LSE), MEcon (UNSW), MBA (Warwick)

Principal, Navigate Consulting Australia Pty LtdEconomic and Health Policy Advisor, WA Labor

7th Australian Rural & Remote Mental Health Symposium

Research objectives

7th Australian Rural & Mental Health Symposium

1. Compare total and per capita spending on mental services in Western Australia to other states

2. Develop rural mental health specific Input-Output transaction tables in order to estimate the annual cost of Mental Illness in Rural and Remote Western Australia to individuals, their families, the broader community and the state

3. Illustrate the current and likely future pressure on health budgets to do “More for Less”

4. From the above, underpin the argument for

1. evidence-based promotion, prevention and early intervention initiatives

2. delivered when possible via cost saving technology such as; M-Health and E-Health applications

• 4.2 million Australians lived in rural/remote areas at the 2011 census

• Evidence suggests mental illness and suicides are more prevalent (per 100k people) within our agricultural and indigenous communities

• It is widely recognised that people in rural and remote areas have poorer access to specialised mental health services, and country people are less likely to seek help.

Existing rural & remote MH systems already struggle to meet the demand; future cash strapped govtsMust either cut costs or raise taxes to deliver theLevel of care we expect

Agenda

The social and economic cost of mental Illness is huge, escalating rapidly and negatively impacts many sectors of the community

People in rural areas face a range of stressorsunique to living outside a major city.

1 in 5 Australians live in rural/Remote areas


• Our “Economic Costs of Mental Illness in Rural Western Australia” research study estimates direct, indirect and induced costs to the individual, family, community and state to be upwards of $2.2Billion per annum

We CAN CONTINUE to deliver high quality mentalhealth services to our rural and remote Residents. But we must Innovate to deliver “More for Less”

• We modelled “Business As Usual” or “No Change” to processes or cost curves in several health service areas to 2021. Results indicate an already burdened health system in many treatment areas by 2021 would not be unsustainable.

• We must develop and embrace new technology including E and M-Health applications. Ironically many African nations are years ahead of us; by virtue of not having established telecommunications infrastructure.

• Break down silos for truly “integrated mental health care services”


Source WHO 2010:

Yet on someindicators critical to the needs of remote patients we need to improve

Service availability

Our health system continues to rank among the most effective and efficient in the world

1 in 5 Australians live in rural and/or remote areas


The Northern Territory and Tasmania had the highest proportions of rural and remote residents of all the states and territories, followed by Queensland.

Together, these three areas accounted for almost 40% of all Australians living in rural and remote areas.

Mental health in rural and remote areas

• People in rural and remote areas have poorer access to specialised mental health services

• They encounter unique stressors that can influence their mental health.

• Tyranny of distance, droughts, to farm failures, to cultural dislocation, legacy of the “Stolen Generation”,

• Repeated surveys indicate they are less likely to seek help.

• Tragically, rates of self-harm and suicide increase with remoteness.

• Some researchers believe the rates of suicide in rural/remote areas are higher than reported (1)


(1) 2008; PWC Mental Health and Drought in Rural and Remote Queensland - Service Mapping Report

Comprehensive indicators of the prevalence of mental illnessin rural Australia are sparse


Occurrences of Mental Ill Health (rate per 100)

Region Mental & Behavioural Problems

Mood (affective) Problems

Males Females Males Females

Major Urban Centres

9.7 11.6 5.9 8.4

Non-metropolitan Areas 12.9 11.9 7.8 9.7

Source: PHIDU (2011). Social Health Atlas of Australian Local Government Areas, 2011. Australian Government, Adelaide.

Though some sources such as the, 2011 Social Health Atlas of Australian Local Government AreasIndicate a higher prevalence than in urban areas

Suicide statistics provide robust evidence of mental ill health in rural and remote Australia


Region Number Ave Annual Rate per 100,000

Australia 10,659 11.1

Major urban centres 7,180 10.2

Non-metropolitan areas 3,426 13.5

Deaths from Suicide and Self-Inflicted Injuries, 0-74 years, 2003-2007

Source: PHIDU (2011). Social Health Atlas of Australian Local Government Areas, 2011. Australian Government, Adelaide.

Mental health visits show a higher prevalence of mental health-related problems among Indigenous Australians


Source: AIHW (2012b)

Mental Health Encounters, Australia, 2010-11

Patient Demographics Per cent of totalmental-health

encounters

Rate (per 100Demographicgroup specific

encounters)

Indigenous Australians 1.00% 16.6

Non-Indigenous Australians 99.00% 11.7

Over the past 15 years government spending on MH services has far outstripped the CPI


Funder1998-99 2003-04 2008-09 2013-14

15 year Ave Ann Growth

Mental Health Recurrent Expenditure ($'M)

Commonwealth Government $638.2 $2,047.8 $1,510.1 $2,919.3 n/a

State/ Territory Governments $1,531.0 $1,837.3 $2,352.7 $3,220.3 n/a

Private Health Funds $148.6 $162.7 $176.5 $185.3 n/a

Total $3,617.8 $4,847.8 $5,939.3 $6,824.9 n/a

Average Annual Growth (%)

Commonwealth Government n/a 10.4% 7.6% 4.9% 7.6%

State/ Territory Governments n/a 3.7% 5.1% 6.5% 5.1%

Private Health Funds n/a 1.8% 1.6% 1.0% 1.5%

Total n/a 5.6% 5.8% 5.7% 5.7%

Calculating The Cost of Mental Illness in Rural and Remote Western Australia


Context• The economic cost of mental illness in the community is high. Outlays by governments and health insurers on mental

health services totalled $9.32 billion in 2012–2013 representing 78.5% of all government health spending.

• An additional $4.63 billion was spent by the Australian Government in providing other support services for people with mental illness, including income support, housing assistance, community and domiciliary care, employment and training opportunities.

• In addition to government expenditure, mental disorders have large economic impacts in other areas including out of pocket personal expenses, carer/family costs, lost productivity and costs to other non-government organisations.

• Evidence suggests that these costs are at least equal to, if not more, than government expenditures.

• Research in Canada estimate that the total economic costs associated with mental illness will increase sixfold over the next 30 years with total cumulative costs exceeding $2.5 trillion dollars (in 2011 present value dollars).


Estimating the “True” cost of mental illness in rural and remote parts of Australia

Our study used Input-Output Transaction tables to estimate the costs of Rural and Remote Mental Illness to the Western Australian economy and society.

• Previous national studies of the economic costs of Mental Illness have provided the framework and data

sources from which a customized Western Australian analysis specifically adjusted for the rural/remote

population was developed.

• The base year for analysis is 2014. We have calculated upper, lower and best estimates of the costs.

• For the purpose of brevity only the best estimates are cited in this presentation.

• This research utilises the prevalence approach (1). I.E the number of people with a mental illness in a

population group over a one year period to estimate the cost of mental illness in Rural and Remote Western

Australia


(1) There are two principle sources of prevalence information for mental illness. The ABS provides the National Survey of Mental Health and Wellbeing 2007 (ABS, 2009), and the AIHW provides The Burden of Disease and Injury Australia, 2003 (Begg et al, 2007). The AIHW’s coverage is more comprehensive, both in terms of diseases and age groups, but the ABS data are more recent.

Typically four groups who bear costs and pay or receive transfer payments are identified

1. People with mental illness and their Friends and family (including informal carers);

2. Federal, State and local governments;

3. Employers, and

4. The rest of society (non-government, i.e. not-for-profit organisations, workers’ compensation groups and

so on).


Classifying the four cost categories and groups enables a framework for analysis, as shown in the following diagram

The total cost of mental illness among rural West Australian’s, on their own lives, their families communities, state and nation in 2014 was $2.2 Billion


Where the costs lie


Dead Weight Losses (DWLs) – the redistribution of public sector resources to care for the sick personincurs deadweight costs on society, such as the need to raise additional taxrevenues (the revenue itself is a transfer payment, not a real economic cost, but for every dollar of tax raised, about 28.75 cents is absorbed in the distortions induced and the administration of the tax system) and to finance welfare payments.

The total cost of mental illness in Western Australia is almostfour times direct Government expenditure

• Our Economics Costs Assessment of Mental Health in WA estimates;

• Mental health imposes costs totalling over $2.2 billion annually on the West Australian economy, through:

• Direct costs associated with health care;

• Significant additional direct costs associated with other service delivery, such as welfare, employment

and housing; and

• Indirect costs associated with reduced workforce participation and productivity (discussed above).


Two Universal Ideals

• Universal and equal access to health services of similar quality for both

remote and urban Australians

• Thereby, improving the health status of the rural and remote Australians


In a current age and seeming future of budget austerity can we reach these lofty goals

4,982

2021E

3,000

2,500

2,000

1,500

1,000

500

02001

Assuming historic trends continue, total spending allocated to diabetes mellitus in Australia is expected to be $5 billion by the end of the decade

Total national spending allocated to diabetes mellitus$m

5,0004,5004,000

3,500

Forecast ‘do nothing’ scenarioHistoric trends

What if we continue as is? Diabetes Example of a “no change” cost curve

SOURCE: AIHW, 2008, Project of Australian Expenditure 2003-2033; AIHW, 2012, Australia’s Health 2012; AIHW, 2010,Australia’s Health 2010

1,197

2011

SOURCE: AIHW, 2011; Australian Hospital Statistics 2009-10; AIHW, 20Prevalence of diabetes; Public Health Information Development Unit(2007), Atlas of Avoidable Hospitalisations in Australia: Ambulatory care-sensitive conditions

220,000210,000

200,000

190,000

180,000

170,000

160,000

150,000

140,000

130,000

120,000

110,000

100,000

2021E20112001

# annual

7.06.56.05.55.04.54.03.53.02.52.01.51.00.5

02021E20112001

Prevalence of diabetes% of population

+3.4%

+1.4%

Forecast ‘do nothing’scenario

+59%

+26%

Forecast ‘do nothing’scenario

Historictrends

Historictrends

Avoidable hospitalisations from diabetesrelated complications

Under the “No Change” scenario diabetes will affect almost 7% of the Australian population and cause a 30% increase in avoidable hospitalisations by the end of the decade

“More for Less”


Three Potential Enablers

• Tighter cost control

• More effective and efficient use of resources

• Innovation in service delivery, processes ……


What can be done?Some promising early interventions

1. Health visiting and reducing post-natal depression

2. Parenting interventions for the prevention of persistent conduct disorders

3. School-based social and emotional learning programmes to prevent conduct problems in childhood context

4. School-based interventions to reduce bullying

5. Early detection for psychosis

6. Early intervention for psychosis

7. Screening and brief intervention in primary care for alcohol misuse

8. Workplace screening for depression and anxiety disorders

9. Promoting well-being in the workplace

10. Debt and mental health

11. Population-level suicide awareness training and intervention

12. Befriending of older adults


2011: London School of Economics: Mental Health Promotion and Prevention: The Economic Case: The Economic impcat of 12 Potential Interventions

E-Mental Health

Scalable online interventions could be the “first line of defence” in a rural and remote mental health system

These could:

• Boost the capacity of the mental health system, so that more people get help;

• Deliver the additional capacity sooner than it would take to build capacity in the health workforce, so that many more people can get help sooner; and

• Be less costly to deliver per person


Early Intervention via E-Mental Health Programs

A growing body of evidence (1) indicates prevention/early intervention efforts can deliver significant benefits

1. By empowering individuals (many who might not seek help) with the skills to avoid poor mental health

2. Dramatically reducing costs to the individual, government and community.

In South Australia:

• An on-line school-based prevention program, helped more than 78,000 young people recover from their depression and/or anxiety, avoiding more than $350 million in costs to the Australian economy.


(1) Doran 2013, Vos et al, 2010, AIHW, 2013, Walker, 2012,

Early intervention through low-cost, widely available e-mental health services should be a priority for mental health service reform, scalable e-mental health services have

the potential to improve the mental health of the community while reducing costs.

Example: e-Mental Health for Aboriginal and Torres Strait Islanders

The National Rural Health Alliance in 2014 proposed that the Government:

• fund the development of a suite of culturally appropriate e-mental health information resources and self-help tools specifically for Aboriginal and Torres Strait Islander people;

• provide ongoing support for an e-mental health portal designed specifically for Aboriginal and Torres Strait Islander people;

• provide ongoing funding for an Aboriginal Wellbeing online program staffed by trained Aboriginal counsellors; and

• provide ongoing funding for Aboriginal Health Workers in e-mental health practice.


What a future Remote Area Mental Health Services Delivery Model Look Like?


Learning from a chronic disease integrated care project in the Kimberley/Pilbara RegionNote: In the live Kimberly/Pilbara Project the disease pathways are Diabetes, COPD and Dementia among others


Feel free to ask for a copy of the presentation slides in addition to a full description of the

methodology and calculations used in this study in the accompanying document tilted “Extended

Research Findings, Literature Review and Bibliography”

From John at the conference or call John at Navigate Consulting on 0402 493 278

or email

[email protected]

Thank You

Appendix – Rural and Remote Mental Health Economic Impact Assessment

Approach and Methodology


Appendix – Economic Impact Assessment Method and ApproachTypes of Costs

• Health system expenditure comprises the costs of running hospitals, GP and specialist services reimbursed through Medicare and private funds, the cost of prescription pharmaceuticals funded through the Pharmaceutical Benefits Scheme and privately, as well as research and health administration attributed to eating disorders.

• Productivity costs include the losses in productivity for people with a mental illness(due to reduced workforce participation, absenteeism, presenteeism, and premature mortality) and the value of informal care provided by family members and others.

• Other financial costs can include all other government and non-government programs and out-of-pocket expenses (such as formal care, aids, transport and accommodation costs associated with receiving treatment) and the bring-forward of funeral costs.

• Transfer costs comprise the deadweight losses (DWLs) associated with government transfers, such as taxation revenue forgone, welfare and disability payments. Welfare payments include the Carer’s Allowance and Disability Support Pension which are sometimes provided to individuals whose Mental Illness or caring role impairs their ability to engage in paid employment. These payments are transfers so affect the distribution of who bears the costs, but are also associated with deadweight losses to society since taxation is required in order to pay them, assuming fiscal neutrality overall.


Appendix – Economic Impact Assessment Method and Approach

Estimating Costs

• There are essentially two ways of estimating each element of cost for each group: top-down: these data

may provide the total costs of a program element (e.g. health system); or

• bottom-up: these data may provide estimates of the number of cases in the category (‘n’) and the average

cost for that category; the product is the total cost (e.g. the wage rate for lost earnings multiplied by the

reduction in employment, and the number of people to whom this applies).

• It is generally more desirable to use top-down national datasets in order to derive national cost estimates to

ensure that the whole is not greater or less than the sum of the parts. On the other hand, it is often difficult

to obtain top-down estimates. In this report the top-down


Conceptualgroup

Subgroups Bearers of Cost Comments

Burden ofdisease

Years of life lost due to disability (YLD)Years of life lost due to premature death (YLL)

Person* The value of a statistical life (VSL) implicitly includes costs borne by the individual.Thus the Net value of burden of disease should exclude these costs to avoid double counting.

Health systemcosts

Costs by type of service eg, hospital inpatients, pharmaceuticals, GPs, allied health etc.

Person*,governments and society (private Health insurers,workers’ compensation)

Productivitycosts

Lost productivity from Temporary absenteeism (time Off work)

Person, employer andgovernment

Long-term lower employment rates Person and government Includes premature retirement

Premature death Person and government Loss of productive capacity

Additional search and hiringreplacement

Employer Incurred when prematurely leave job

Lost unpaid work of person Person Includes housework, yardwork, childcare andVolunteer work

Lost informal carer productivity Friends and family andemployer

Includes both paid and unpaid work

Other financialcosts

Cost of care,aids,equipment,modifications,etc

Person, government and society

Not estimated in this study

Funeral costs brought forward Friends and family

Transfer costs Dead Weight Losses Society Relate to transfers from taxation, welfare etc


Feel free to ask for a copy of the presentation slides in addition to a full description of the

methodology and calculations used in this study in the accompanying document tilted “Extended

Research Findings, Literature Review and Bibliography”

From John at the conference or call John at Navigate Consulting on 0402 493 278

or email

[email protected]

2015-anz rural mental health

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