For many people, it is most easily apparent that depression is an important problem because of the personal suffering that it can inflict on those who experience it. And, indeed, the personal suffering depression causes is troubling. In addition to this suffering, depression also has important impacts on society-at-large. Due to the high prevalence of depression, the costs of treating it in the health care system are sizeable. In addition, in both the US and worldwide, depression is recognized as one of the most common reasons workers are unable to work or are less productive at work. This decrease in worker productivity has financial implications for families, employers and government.

What Is The Health Care Cost of Depression?

Wide variability in the structure of health care and access to health care around the world makes it difficult to examine health care cost for the planet as a whole. However, data suggest that depression is an expensive condition within the health care system. On average in the US, people with depression have more frequent use of health care and increased health care costs compared to those without depression.  Recent estimates for the cost of health care treatment and medication for those with Major Depressive Disorder in the US were approximately $100 billion dollars per year (Greenberg, Fournier, Sisitsky, Pike, & Kessler, 2015). These costs are partially due to the costs of treating depression itself. However, over the long-term, the greatest portion of health care costs are often due to poor health outcomes for co-occurring conditions such as diabetes, heart disease and obesity (Egede, Zheng, & Simpson, 2002).

Why Is Health Care Cost An Important Issue?

The health care cost of depression and other conditions is a frequently discussed issue among US health care providers and policy-makers. Why is this the case? In recent years health care costs in the United States have been growing at a rapid pace and recent estimates show they account for about 16% of all the money the US economy makes in one year (OECD Health Statistics 2015, 2015). In addition, the government and employers pay for a large portion of these health care costs so this increase is crowding out other important areas like education and infrastructure, and limiting the extent to which employers can raise wages. Furthermore, there is no evidence that people are actually healthier for all the increased spending. The growth seems largely to stem from inefficiencies and misplaced care rather than health care that actually improves people’s health. Because of the high prevalence of depression and the negative impacts it can have on other areas of health, the health care costs related to depression are an important societal issue.

How Does Depression Impact The Workforce?

It can be tricky to answer this question. Economists and health care professionals who study this issue have various ways they try to quantify how much workers are affected by health conditions. One of the common ways is to estimate how many total years workers are unable to work due to a health condition, when they would otherwise be working (i.e. How much disability from work is caused?). By this measure, depression is the leading cause of work disability worldwide (WHO; Depression: A Global Public Health Concern, 2012). Another way to look at this is to try to understand how much less workers get done while they are at work because of a health condition (i.e. How much is worker productivity decreased?). Because some of the very symptoms of depression include fatigue, difficulty concentrating and difficulty making decisions, it is easy to see how those experiencing depression may have trouble being efficient at work. Indeed, in the US, people who have depression are estimated to cost employers more than 44 billion dollars annually, with 81% of that cost being due to less effective performance while on the job, sometimes called “presenteeism” (Stewart, Ricci, Chee, Hahn, & Morganstein, 2003). By another estimate, Major Depressive Disorder costs employers 27 days of work per year (Kessler et al., 2006). Some of the reasons people are less effective at work may contribute to both their depression and their decreased work performance (e.g. co-occurrence of another major health condition). But even when accounting for such factors, depression itself still accounts for about half of the decreased productivity shown by workers with depression (Stewart et al., 2003).

Egede, L. E., Zheng, D., & Simpson, K. (2002). Comorbid depression is associated with increased health care use and expenditures in individuals with diabetes. Diabetes Care, 25(3), 464-470.

Greenberg, P. E., Fournier, A. A., Sisitsky, T., Pike, C. T., & Kessler, R. C. (2015). The economic burden of adults with major depressive disorder in the United States (2005 and 2010). J Clin Psychiatry, 76(2), 155-162. doi:10.4088/JCP.14m09298

Kessler, R. C., Akiskal, H. S., Ames, M., Birnbaum, H., Greenberg, P., Hirschfeld, R. M., . . . Wang, P. S. (2006). Prevalence and effects of mood disorders on work performance in a nationally representative sample of U.S. workers. Am J Psychiatry, 163(9), 1561-1568. doi:10.1176/ajp.2006.163.9.1561

OECD Health Statistics 2015. (2015). Retrieved from http://www.oecd.org/unitedstates/Country-Note-UNITED STATES-OECD-Health-Statistics-2015.pdf

Stewart, W. F., Ricci, J. A., Chee, E., Hahn, S. R., & Morganstein, D. (2003). Cost of lost productive work time among US workers with depression. Jama, 289(23), 3135-3144. doi:10.1001/jama.289.23.3135

WHO; Depression: A Global Public Health Concern. (2012). Retrieved from http://www.who.int/mental_health/management/depression/who_paper_depression_wfmh_2012.pdf

Article Topics

Discover More