Guest blog (Shelley Cadamy): Spending on mental health services earns a substantial return on investment

Shelley Cadamy is a native Oklahoman and adoptive/foster parent who has done economic development work in Oklahoma since 1994.

During a Leadership Oklahoma City session several years ago, I had the opportunity to ask the Oklahoma City Police Chief and Oklahoma County Sheriff what one thing each would change if they could. The answer was clear and unanimous – expand care for the mentally ill.

Regardless of one’s views on a government’s moral responsibility to its mentally ill citizens, the economic arguments for treating the mentally ill are staggering. According to the Oklahoma Department of Mental Health & Substance Abuse Services (ODMHSAS), the greatest direct cost associated with untreated mental illness and addiction in Oklahoma is to the state Department of Corrections and the overall criminal justice system, which must bear the financial burden as increasing numbers of untreated mentally ill Oklahomans cause disturbances and become incarcerated. Out of 25,000 inmates, the Oklahoma Department of Corrections estimates that nearly 12,000 have a history of, or are currently exhibiting, some form of mental health problem.

Three years ago, I became a foster parent to my now adopted children, and I experienced first-hand the social and economic effects of untreated mental illness. Mental illness is rampant for generations on both sides of my children’s biological family, and though it’s not the only cause, it is a serious contributor to the generational abuse and neglect that led to my children becoming foster children. Untreated mental illness also contributed toward various members of their extended family’s incarceration, teenage pregnancies, drug and alcohol abuse, and dependence upon public assistance like Social Security Disability, Section 8 housing and food stamps.

At last year’s Journal Record “50 Women Making a Difference” event, Terri White, commissioner for the state Department of Mental Health and Substance Abuse Services,  explained that though Oklahoma is a dismal 46th in the nation for mental health funding, her department took a $20 to $25 million dollar cut in a period of 18 months and will take another cut in 2011.

While the reduction of mental health services may seem like a necessary  economic move in the short-term, it will actually result in further over-crowding of our jails and prisons, increased emergency room visits, increased homelessness, more kids in foster care, and increased job absenteeism, all of which result in huge negative economic impacts for our state.

Source: OKDMHS, "Smart on Crime: A Better Choice,"

Though the annual cost of incarcerating someone with a serious mental illness in Oklahoma ($23,000) far outweighs actual treatment ($3,968 for mental health inpatient services or $1,275 for mental health outpatient services), we continue to allocate dollars to incarceration rather than treatment. Additionally, the ODMHSAS has demonstrated that the cost of their proposed “Smart on Crime” approach, which includes programs to address mental illness and addiction at various diversion points, presents a significant savings of $95.6 million annually to the state of Oklahoma and a net gain/cost savings of at least $123 million a year for every year beyond the initial 5 years of the program. ODMHSAS’ estimates involve direct costs only.

Dr. Thomas R. Insel, MD reported in the June 2008 issue of the American Journal of Psychiatry that the estimated indirect costs of untreated mental illness to the US totaled $317 billion in 2002. That number includes health care expenditures, loss of earnings, and disability benefits only, and not the cost to the corrections system; police, fire and emergency; or the foster care system.  Finally, his findings did not include those who are incarcerated, institutionalized or homeless, so the actual indirect cost in 2010 is substantially higher than the $317 billion that was established in 2002, and Oklahoma’s portion is substantial.

As an economic development professional, I know that certain expenditures by the state earn a substantial return on investment.  We’ve funded the Quality Jobs Program for over a decade in an effort to recruit quality jobs here.  We fund seed investment through OCAST and i2E.  It’s time for us to view mental health services as an investment as well – one that will return tremendous cost savings and a higher quality workforce for decades to come.

The opinions stated above are not necessarily those of OK Policy, its staff, or its board. This blog is a venue to help promote the discussion of ideas from various points of view, and we invite your comments and contributions. To see our guidelines for blog submissions, click here.


Gene Perry worked for OK Policy from 2011 to 2019. He is a native Oklahoman and a citizen of the Cherokee Nation. He graduated from the University of Oklahoma with a B.A. in history and an M.A. in journalism.

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