Disease Management Programmes for Major Depression: Making the Financial Case

Depression is a significant burden for the United Kingdom economy and despite conclusive evidence on the clinical efficacy of treatments and acknowledgements of the impact on quality of life, a high proportion still goes undiagnosed and untreated. The purpose of this paper is to present the economic case for a more structured approach to depression management, using techniques from the disciplines of health economics and actuarial science to demonstrate cost-effectiveness and return on investment. The results are presented first as an economic cost-effectiveness analysis, comparing the benefits of additional quality-adjusted life years (QALYs) with the costs, and secondly as a financial projection model of costs and savings, familiar to actuaries. The results of the model show that from a societal perspective, disease management programmes for depression are likely to both reduce costs and increase quality of life for patients in the overall adult population. This is also true from the perspective of an employer who has the cost burden of direct medical costs and sickness absence. For a healthcare payer who is not bearing the cost of sickness absence, such as a primary care trust (PCT) or private insurer, disease management programmes are likely to improve quality of life, but increase direct healthcare costs. However, the additional cost per QALY is well below the commonly used threshold in the U.K. of £30,000; therefore, most health economists would deem disease management programmes for severe and moderate depression to be a good use of public healthcare funds. The actuarial calculations, which show an internal rate of return for 45% to 50%, validate this conclusion.