National Estimates of Expenditures for Mental Health and Substance Abuse Treatment, 1997

An estimated 28 percent of the adult U.S. population will suffer from a mental health or substance abuse (MH/SA) disorder, including alcohol or drug abuse problem, during the course of a year. Of the ten leading causes of disability worldwide in 1990, five were psychiatric conditions including alcohol abuse. Given the prevalence of MH/SA-related morbidity and mortality and its effects, it is important to know how much the United States is investing in treatment of mental and substance abuse disorders. Moreover, due to the rapid changes occurring in treatment technologies, philosophy, organization, and financing, the extent and character of this investment should be tracked over time.

This is the second in a series of reports planned to provide periodic updates of national expenditures for MH/SA treatment. The report addresses the following key questions:

• How much is spent in the United States to treat MH/SA disorders?

• How are the expenditures distributed by payer and provider type?

• How has spending changed from 1987 to 1997?

• How do MH/SA expenditures compare to those for all U.S. health care?

This project estimated MH/SA treatment expenditures using data and methods that the Health Care Financing Administration (HCFA) uses for estimates of national health expenditures from the National Health Accounts (NHA). This work is based primarily on nationally representative databases with multiple years of data, which generally cover the study period of 1987 to 1997. The study examines expenditures for two sectors of providers the specialty MH/SA providers and non-specialized general health care providers who also deliver MH/SA services. Two sets of estimates, adjusted for general inflation, were made: "NHA-equivalent MH/SA expenditures" which are comparable to all health care spending because they focus exclusively on health-care-service-related MH/SA treatment, and "total MH/SA expenditures" which include some social services (such as custodianship of group homes) delivered by specialty MH/SA providers. The estimates are presented for mental health (MH), substance abuse (SA), MH/SA combined, and all health care expenditures.