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Mental health, substance abuse spending grew more slowly than all other health spending: Study

August 07, 2019

?              Psychiatric drug spending growth is declining. In the past psychiatric drugs were a major driver of overall mental health spending - contributing almost half of the increase in mental health spending between 1998 and 2002. However, because of the wider use of less-expensive generic drugs and reduced numbers of new people using psychiatric medications, the growth rate in spending for these drugs actually slowed from 27.3 percent from 1999 to 2000 to only 5.6 percent from 2004 to 2005 

?              Spending on addiction medications is increasing but still remains relatively small. As a result of the introduction of new medications to treat substance dependence, spending on addiction medications has grown rapidly -- from $10 million in 1992 to $141 million in 2005. More recent data from IMS Health shows continued rapid increases up to $780 million in 2009. However, it remains only a small fraction of the entire amount spent on substance abuse treatment (0.6 percent of $22 billion in 2005). 

?              Private insurance spends about 5 percent on behavioral health treatment. Spending on behavioral health treatment (mental health and substance abuse) comprised 4.8 percent of private health insurance expenditures in 2005 and grew by 7 percent from 2004 to 2005.  This estimate provides an important baseline for evaluating the impact of the Mental Health Parity and Addictions Equity Act and Affordable Care Act.  In contrast, Medicaid behavioral health was responsible for 11.5 percent of total spending by Medicaid in 2005.

SOURCE Substance Abuse and Mental Health Services Administration