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The economic cost of physical ill-health and serious mental illness

The economic cost of physical ill-health and serious mental illness

A new report released by the Royal Australian and New Zealand College of Psychiatrists (RANZCP) confirms recommendations from the National Mental Health Commission’s National Review Contributing Lives, Thriving Communities.

The report provides further evidence that many Australians with a mental illness are experiencing much higher rates of physical ill-health and not receiving the physical health care and support they need, resulting in a substantial cost impact on individuals and on the national economy.

The RANZCP report The economic cost of serious mental illness and comorbidities in Australia and New Zealand looks specifically at those with a serious (or severe) mental illness. It provides useful insight into a highly vulnerable group who on average die decades younger than the general population, often due to preventable or treatable physical health problems. 

The report calculates the economic cost of premature death of people with mental illnesses including schizophrenia, bipolar disorder, psychoses and severe anxiety and depression to be $15 billion (.9% of GDP) annually, and the cost overall to be $56.7 billion (3.5% of GDP).

Professor Allan Fels, Chair of the National Mental Health Commission, welcomes the report. “As an economist, I want to emphasise that mental health is a significant problem for our economy” Professor Fels said.

“Many people do not receive the support they need, and governments get poor returns on substantial investment. In particular, mental ill-health results in a substantial loss of productivity, and for Australian business this results in around 12 million days of reduced productivity a year”.

The Commission has been working with stakeholders to develop a ‘National Consensus Statement on Identification and Care for the Physical Health of People with a Mental Illness’, which addresses these inequalities. The Consensus Statement is now in its final draft and will be released later this year.

The RANZCP report provides further evidence of the need for coordinated care packages for people with severe and complex needs. Poor physical health compromises mental health recovery, and has a substantial cost impact on the national economy.

The Commission will continue to monitor and advocate for those with a serious mental illness to ensure they receive the physical health care and support they require. This will be carried out in partnership with professional colleges, consumers and carers, the Commonwealth, states and territories and some service providers.

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Acknowledgement of Country

The Commission acknowledges the traditional custodians of the lands throughout Australia.
We pay our respects to their clans, and to the elders, past present and emerging, and acknowledge their continuing connection to land, sea and community.


The Commission is committed to embracing diversity and eliminating all forms of discrimination in the provision of health services. The Commission welcomes all people irrespective of ethnicity, lifestyle choice, faith, sexual orientation and gender identity.

Lived Experience

We acknowledge the individual and collective contributions of those with a lived and living experience of mental ill-health and suicide, and those who love, have loved and care for them. Each person’s journey is unique and a valued contribution to Australia’s commitment to mental health suicide prevention systems reform.