Long-Term Growth in Child Mental Health Expenditures, 2004-2023

Abstract Background Investment in mental health treatment for children has grown substantially, but whether this reflects more treatment recipients, higher spending per user, or both has not been examined. Objective To estimate trends in mental health expenditures, probability of use and expenditures per user for US children aged 2–17 from 2004 to 2023. Methods Two-part models were estimated to predict inflation adjusted health expenditure data from the 2004-2023 Medical Expenditure Panel Survey (unweighted N=153,622) to assess overall trends and variation by age-group and insurance coverage. Findings Total annual mental health expenditures increased from $10.9B to $37.9B, rising from 4.4% to 8.1% of total health expenditure per child (mean individual-level ratio among children with any health care expenditure). The probability of mental health service use more than doubled (6.3% to 13.0%, +0.35 percentage points/year), while expenditure per user grew from $2,816 to $5,178 (+3.3%/year). Relative to the 2004 baseline those age 2-5 had the greatest growth in both service use and expenditure per user. Expenditure per user grew substantially faster for privately-insured than for Medicaid-covered children. Conclusions Child mental health treatment expenditures have grown dramatically over the past two decades, with particularly large increases for those ages two to five.