Healthcare spending on mental, substance use disorders projected to slow by 2020

Spending on mental and substance use disorders is likely to grow at a slower pace than all health spending through 2020, according to a study from Truven Health Analytics.

The study, published in Health Affairs, found as a share of all health spending that on mental and substance abuse disorders will fall from 7.4 percent in 2009 to 6.5 percent in 2020. That projected growth is slower than the average annual growth in all health spending (5.8 percent), which CMS has projected from 2012 to 2022.

The projected decrease in spending is linked to a couple of factors, including the projected result of reduced spending on mental health drugs because of patent expirations, the low likelihood of innovative drugs entering the market and a slowdown in spending growth for hospital treatment.

The expiration of patents for mental health retail prescription drugs is expected to be more concentrated than for all other retail prescription drugs. Prescription medications account for a significant portion of treatment spending for mental health compared to treatment spending for all health (28 percent for mental health and 11 percent for all health in 2009). From 2009 through 2020, patent loss will allow the entry into the market of generic products with prices assumed to be about 70 percent lower than the price of the brand-name equivalents.


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