Quantifying the Cost of Depression

Key Findings

  • Approximately 6-7% of full-time U.S. workers experienced major depression (MDD) within the past year.
  • The total economic burden of MDD is now estimated to be $210.5 billion per year.
  • For every dollar spent on MDD direct costs in 2010, an additional $1.90 was spent on MDD-related indirect costs.

An important study reveals just how vulnerable the work environment is to the financial impact of depression.

Quantifying the Cost of Depression
Quantifying the Cost of Depression

Major depressive disorder (MDD) is estimated to affect around 16 million Americans (Substance Abuse and Mental Health Services Administration [SAMHSA], 2013) and, according to the World Health Organization, is the leading cause of disability worldwide (World Health Organization 2012). Among In the U.S. workforce, the prevalence of MDD has been estimated at 7.6% (Birnbaum et al., 2010). Major depression is a psychiatric disorder that goes beyond the normal human experiences of sadness. It encompasses a broad range of symptoms such as feeling worthless, having thoughts of suicide, losing interest in most or all activities, experiencing a significant reduction or increase in appetite or sleep, and having difficulty concentrating. Symptoms must be distressing to the individual or lead to an inability to function normally, such as at work or in maintaining relationships.

Depression can result in reduced educational attainment, lower earning potential, increased chance of teenage childbearing, higher unemployment, and increased work disability (Kessler, 2012). This study, authored by experts in economics and psychiatric epidemiology, provides a new look at the scope and scale of the financial burden of MDD to employers.

Eye-Opening Figures

Published in the Journal of Clinical Psychiatry, the study from Greenberg and colleagues (2015) examined trends in costs associated with MDD. Investigators used data spanning from 2005, when the country’s economy and job markets were generally considered robust, to 2010, following the U.S. financial downturn that characterized much of 2007-2009.

Among their major findings is that the total economic burden of MDD is now estimated to be $210.5 billion per year, representing a 21.5% increase from $173.2 billion per year in 2005. Of particular interest is that nearly half (48%-50%) of these costs are attributed to the workplace, including absenteeism (missed days from work) and presenteeism (reduced productivity while at work), whereas 45%-47% are due to direct medical costs (e.g., outpatient and inpatient medical services, pharmacy costs), which are shared by employers, employees, and society. About 5% of the total expenditures are related to suicide.

Presenteeism appears to be a particularly large drain, eating up 77% of MDD’s workplace spending and 37% of the overall $210.5 billion (Greenberg et al., 2015). Presenteeism costs increased 21.5% from $64.7 billion in 2005 to $78.7 billion in 2010; absenteeism, on the other hand, rose only 8.3%, from $21.5 billion to $23.3 billion. Presenteeism associated with depression resulted in the equivalent of 32 incremental workdays lost. The authors estimated presenteeism by calculating 6.1 times the cost of absenteeism due to illness or injury, which is consistent with previous approaches in the literature (Stewart et al., 2003).

Read the full article here.

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