Recently Published Reviews Psychiatric Services This study sheds light on how financial interventions can help improve the behavioral health outcomes of adults with mental illness and substance use disorders. The study reviewed more than a century of literature and found that financial-based interventions, such as money management programs and alternative payee services, not only help individuals manage their finances, but may also reduce substance use and improve overall functioning.
The researchers conducted the study to address a critical gap in the treatment of adults with mental illness, substance use disorders, or both. Many people with these disorders struggle to manage their finances, which can exacerbate their health problems.
The cognitive challenges associated with these disorders (e.g., impulsive spending, difficulty managing budgets, and being a victim of fraud) can exacerbate financial insecurity, which in turn can increase stress and further worsen mental health conditions. Financial difficulties can also impede adherence to treatment and increase the likelihood of hospitalization.
Previous studies have shown that when people with severe mental illness receive help managing their finances, they tend to have better health outcomes, including better quality of life and fewer hospitalizations, but these findings have been mixed and no comprehensive review of the evidence has been conducted until now.
“Money is an essential part of life, yet many Americans are reluctant to talk about it,” the study authors said. Jack Tsai“A significant percentage of Americans have consumer debt and financial literacy is low across socioeconomic groups, but particularly among low-income adults with mental illness. I wanted to look at interventions that can help adults with mental illness become financially literate and better manage their money,” said Dr. John F. Kelly, regional dean and professor of public health at the University of Texas Health Science Center at Houston.
The study was a systematic review of peer-reviewed literature published from 1900 to 2022. The researchers searched multiple databases, including PubMed and Google Scholar, for studies of adults with mental illness or substance use disorders who participated in financial-based interventions. The search yielded more than 2,000 papers, which they narrowed down to 18 studies that met specific criteria. The selected studies focused on replicable financial interventions for adults with behavioral health conditions and reported quantitative outcomes related to money management or behavioral health.
“I was surprised to see that not many interventions have been developed in this field,” Tsai told PsyPost. “I knew most of the researchers whose studies I included in my review, so I was hoping to find new interventions that I wasn’t aware of, but I was surprised to see how few there were. This suggests that the field needs further growth and development.”
These studies included a variety of financial interventions. Some were voluntary, such as financial literacy programs that teach budgeting and savings skills, while others were more structured, such as representative payee programs, in which a third party manages an individual’s finances. In some cases, these arrangements were legally binding, and the third party controlled how disability funds and other benefits were distributed.
Researchers have found that financial interventions can actually have a positive impact on behavioral health outcomes. One of the most significant findings is that money-based interventions can reduce substance use among people with mental illness and substance use disorders. In particular, the review highlighted the benefits of representative beneficiary programs. These programs were found to help individuals manage their finances in ways that lead to reduced substance use, especially among people with severe mental illness.
In addition to substance use, some studies have found that financial interventions also improved money management skills. Researchers found that people who participated in structured financial programs, such as alternate payee services or education programs, reported feeling better in control of their finances. Not only did these programs help individuals track their spending, but they also led to improved financial planning and budgeting over time.
Interestingly, the researchers noted that the benefits of financial intervention go beyond simply financial stability: improved money management appears to have a ripple effect, leading to improved mental health and overall functioning.
For example, several studies have found that participants in financial programs have fewer hospitalizations and make better use of outpatient health care services. Improved financial management also appears to increase participants’ self-efficacy — their confidence in their ability to manage their lives — a key factor in long-term recovery from mental illness and substance use disorders.
“There are several finance-based interventions that can help people with mental illness or addictions better manage their money and improve their functioning,” Tsai explained. “The big finding to note is that money management not only improves their financial situation, but may also improve behavioral health issues. Having structure and discipline in one area of life (e.g., finances) may also help improve other areas of life (e.g., addictions).”
However, the researchers also found some negative results, noting that the therapeutic relationship could be negatively affected, particularly when clinicians acted as both therapist and surrogate payee. Clients who took on such dual roles often felt coerced, which negatively affected their overall experience of the intervention. This finding highlights the need for careful consideration of who should serve as financial administrator and in what circumstances.
Although this review offers important insights, it also has limitations. One main issue is the paucity of high-quality research on financial interventions for people with behavioral disorders. Only four of the studies were randomized controlled trials, which are considered the gold standard for judging the effectiveness of interventions. Given the promising results, the researchers stressed that more rigorous research is needed in this area.
“More randomized controlled trials of financial-based interventions are needed,” Tsai said. “The most studied intervention is substitute beneficiary systems, but self-management of income has also received much interest and deserves further study.”
“I want to develop a suite of evidence-based financial interventions for diverse populations with different financial needs, ranging from highly structured, expert-led service models to self-paced educational models. I also want to study how finances and behavioral health are causally related to identify cause and effect, and how we can improve Americans’ lives in these two areas. We have a crisis in this country, both a behavioral health crisis and a consumer debt and financial mismanagement crisis, and that’s what motivates me to continue pursuing this area of research.”
“If you are interested in this topic and would like to help with a funded intervention, please feel free to contact us,” Tsai added. “We are also always looking for funders to support our work.”
the study, “A systematic review of financial interventions for adults with behavioral health conditions” was written by Jack Tsai, Rebecca L. Kinney, Eric B. Elbogen and Jeffrey Gruff.
