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Avoidable early deaths costing $3.1 billion annually

4 May 2015

Avoidable early deaths costing New Zealand economy $3.1 billion annually

Investment in the physical health care of people with mental illness could recoup millions for the New Zealand economy says the Royal Australian and New Zealand College of Psychiatrists who have released a report which calculates the economic cost of premature death of people with mental illnesses including schizophrenia, bipolar disorder, psychoses and severe anxiety and depression to be $3.1 billion (1.3% of GDP) annually, and the cost overall to be $12 billion (5% of GDP).

‘Mental disorders cost society enormously’ said RANZCP President Professor Malcolm Hopwood.

‘With many severe disorders emerging between the ages of 15 – 25 years, we know thousands of young people are struggling to deal with serious illness at key times of education and early employment which can have a long-term impact on their life.

‘Those same individuals often experience poorer physical health as adults. We know this is true because we see it in the early rates of death of many with serious mental illness. Men and women in New Zealand with mental illness have more than twice the risk of death than is average. People with psychotic disorders have an even higher mortality rate – three times the general population.

The report recommends that this can be addressed by greater focus on prevention of avoidable health conditions such as cancers, diabetes and cardiovascular conditions.

‘New Zealand is ahead of Australia in addressing this issue with the Te Pou – Equally Well coalition underway, but it needs continued effort. By encouraging services to address the gap in physical health care provision to screen and support people with mental illness, the New Zealand government could gain back years of income tax contributions and lessen the disability-adjusted life years experienced by people with serious mental illness’ said Professor Hopwood

‘In particular the burden associated with substance abuse is immense adding $5 billion to the cost of the burden of serious mental illness, and doubling the economic impact of premature mortality from $3.1 billion to $6.2 billion when substance abuse is included.

The report was produced by the Australian Victoria Institute of Strategic Economic Studies and jointly funded with think tank the Australian Health Policy Collaboration and the Royal Australian and New Zealand College of Psychiatrists.

The Chair of the New Zealand National Committee, Tu Te Akaaka Roa, Dr Mark Lawrence, says the report is being well received in New Zealand. ‘We are pleased that this crucial information is now available to inform health policy in New Zealand, and we hope that DHBs take on board the need to encourage and support their services to collaborate on the physical and mental health care of people.

‘We also hope it can provide impetus for the government to consider a greater investment in mental health as paying off in broader policy returns across education, employment and justice.

‘Mental illness concerns many New Zealanders. It affects one in four people across all echelons of New Zealand society so it might be your parent, your brother or your child who is affected. It could be your accountant, tutor or colleague’ said Dr Lawrence.

‘The situation for Maori is concerning as they already have a reduced life expectancy compared with the non-Maori and their health is further compromised by mental illness coupled with poor physical health.’

‘Unfortunately stigma and discrimination are still alive and well. The ugly truth is that it seems to be quietly accepted that there is a higher risk of premature death for people with a mental illness due to physical illness or suicide. Both are areas of need where a funding boost could see both short and long-term results.

‘As doctors we are most interested in people not numbers, but the evidence demonstrates that there is a financial windfall waiting for the government brave enough to make saving people’s lives the priority’.

Other key findings from the economic modelling report include:

• The cost to the New Zealand economy of mental illness, when substance abuse is included in the analysis balloons to $17 billion

• Without substance use, the cost of mental illness to the New Zealand economy is $12 billion.

• People with serious mental illness almost always live with comorbid physical illnesses such as diabetes, metabolic syndrome, cardiovascular and respiratory disease, gastrointestinal conditions or cancers.

• Investments in both hospital and community care treatment models could potentially help almost one hundred thousand (92,047) New Zealanders recover more quickly and stay well longer

• Evidence in the report indicates that best practice in health care could reduce the impact of serious mental illness and comorbidities by almost one-third.

The full report on the economic cost of serious mental illness in Australia and New Zealand is accessible from

A PDF of the Foreword to the report by Professor Mal Hopwood is attached.

For more information about this issue and previous reports go to


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