Mental health leaves cost twice as much as physical disability, and the bill keeps growing
Mental illness costs the Canadian economy $51bn a year and accounts for more lost workdays than any other chronic condition, according to the Canadian Psychological Association.
Mental health leaves cost employers twice as much as those related to physical disability.
A new report from Beneva maps how that pressure plays out across every generation in the workforce — and what it means for group benefits.
Beneva's 2026 Connecting the Dots report draws on internal claims data spanning nearly a decade.
Prescription drug spending has grown at an average annual 7 percent rate per insured over eight years, while dental fee guides in Quebec and British Columbia have outpaced general inflation by a cumulative 12 percent by 2025.
From 2017 to 2025, the number of young insured persons who consulted a mental health professional doubled — a 9 percent average yearly increase, per Beneva's data.
Antidepressant usage among this group grew 2.5 times faster than in other age groups.
Yet antidepressants remain the dominant form of care, not because they are more effective or preferred, but because they carry lower upfront costs than psychotherapy.
The financial backdrop helps explain why.
Only one in five young adults feels financially secure, per FP Canada's 2026 Financial Stress Index, and nearly two thirds believe they are falling behind their peers financially, according to Global News.
Over 50 percent of young employees also report barriers to using Employee Assistance Programs, including limited awareness and uncertainty around confidentiality, per Mental Health Research Canada.
Mid-life adults carry the heaviest load
Beneva said adults aged 31 to 50 generate the highest psychological care claims of any age group, growing at 4 percent annually since 2017.
This cohort also recorded the largest increase in short-term disability claims related to mental health, up 8 percent since 2019.
A significant portion belongs to the sandwich generation — simultaneously supporting children and aging parents.
Statistics Canada research shows sandwiched caregivers are more likely to reduce their hours (14 percent), adjust their schedule (30 percent) or give up better opportunities at work (7 percent) compared to other caregivers — with long-term consequences for income growth and pension accumulation.
Beneva's data shows drug costs jump just over 50 percent per insured from young adulthood to mid-life, reflecting the sharp rise in chronic conditions during prime working years.
More than one in four adults aged 51 to 65 live with two or more chronic conditions; among those aged 60 to 64, that rises to 37 percent, per the Government of Canada.
Beneva's 2025 claims data shows a 27 percent jump in medication costs per insured compared to mid-life adults.
A 2024 study in the Canadian Medical Association Journal found women had 44 percent higher odds of reporting cost-related medication non-adherence due to competing caregiving and work priorities.
The Canadian Institute of Actuaries' data shows long-term disability claims beginning at older ages are more likely to remain active over time — reflecting a lower likelihood of return to work.
The total cost of cancer care in Canada reached $26.2bn in 2021, with approximately 30 percent borne directly by patients and families, per the Canadian Cancer Society.
Beneva's internal data shows critical illness cases are associated with longer disability periods and greater reliance on high-cost medications — particularly when financial stress is present.
Research led by Marie-José Durand at Université de Sherbrooke found that key obstacles such as persistent fatigue and cognitive "brain fog" are frequently underestimated during return-to-work planning.
Disability claims are consistently one of the two largest cost drivers in group insurance alongside drug claims.
Francois Robitaille, psychiatrist and medical consultant for Beneva, identifies a critical window: timely action within the first months of a disability claim is essential for recovery.
When support is delayed, conditions are more likely to become chronic, absences extend and the probability of returning to work declines sharply.
With retirement outpacing labour force entry and public health care systems under growing pressure, Beneva concludes that sustainability in group insurance will not come from offering less — but from designing better and treating mental health as foundational rather than supplementary.
