The article “Drowning in a Sea of Diagnoses. How medicalising distress is overwhelming Australia’s mental health system and failing those most in need” authored by Emeritus Professor Steven Schwartz and published by the Centre for Independent Studies, examines the critical issues within Australia’s mental health system. The report argues that despite a massive increase in government spending and the number of mental health inquiries, population-wide mental health outcomes have not improved.
The Central Problem: Medicalising Distress
… the system is designed to “produce patients rather than health”…
The report identifies a paradox: while funding has soared, the number of Australians classified as mentally ill continues to rise, and suicide rates remain stagnant. The author argues that the system is designed to “produce patients rather than health” by medicalising normal human distress and making support dependent on receiving a formal diagnosis.
- Diagnostic Expansion: Categories like ADHD, autism spectrum disorder, and anxiety have expanded significantly. Schwartz suggests this is often due to “diagnostic boundary expansion” rather than a genuine increase in pathology.
- The “Diagnostic-Industrial-Government Complex”: A self-reinforcing system exists where patients seek diagnoses to access services, clinicians require them for billing, and schools or employers use them to justify accommodations.
- The RSI Analogy: The report draws a parallel to the 1980s Repetitive Strain Injury (RSI) epidemic in Australia, which disappeared once the cultural narratives and financial incentives surrounding the diagnosis changed.
Consequences for the Most Vulnerable
A major flaw in the current “continuum” approach is that it treats all forms of distress—from exam stress to severe psychosis—as similar. This leads to:
- Resource Competition: People with severe, lifelong conditions (like schizophrenia or profound autism) must compete for limited resources with a much larger group of people experiencing milder difficulties.
- Chronic Dependency: For those with mild issues, professional intervention can risk converting temporary hardship into long-term dependency.
- Identity Issues: Labeling young people early in life can cause them to adopt a “sick role,” leading to a loss of agency and self-reliance.
Proposed Reforms for a Recovery-Oriented System
The report advocates for a “Better Way to Help” through five core policy shifts:
- Functional Assessment: Replace diagnosis-based eligibility with assessments of what people can actually do, conducted by independent assessors.
- Stepped Care: Prioritize low-intensity interventions (like peer support or digital tools) for mild cases, reserving specialist care for those with the highest need.
- Address Contextual Causes: Solve problems like housing, unemployment, and social isolation through civic and social networks rather than clinical medicalisation.
- Reward Recovery, Not Retention: Change funding models to pay clinicians for helping people exit the system and return to independent living, rather than for ongoing service volume.
- Outcome-Based Data: Track meaningful outcomes like functional recovery and duration in care rather than just inputs and spending.
The article concludes that the system’s success should be judged by how many people no longer need it, shifting the focus from “diagnostic expansion” to “human flourishing”.