Invisible wounds, visible savings? Using microsimulation to estimate the costs and savings associated with providing evidence-based treatment for PTSD and depression to veterans of Operation Enduring Freedom and Operation Iraqi Freedom.

evidence-based treatment (EBT). Our results suggest that the 2-year social costs of depression and PTSD for this cohort will be $923 million. Policy simulations evaluating the savings associated with universal access to EBT suggest that such access would generate cost savings of $138 million (15%). Since 2001, more than 1.64 million U.S. troops have deployed to Operation Iraqi Freedom (OIF) or Operation Enduring Freedom (OEF), a pace unmatched in the history of the all-volunteer force (Tanielian & Jaycox, 2008). The future health-related costs of these deployments will undoubtedly be high because of physical and mental health injuries sustained during war. Calculation of these costs, which the government will be expected to pay, is a difficult task because of the inherent uncertainty underlying all the components that are necessary to construct such an estimate, including the number of people harmed, the number seeking treat- ment, the types of treatment given, the cost associated with treat- ment, and the subsequent outcomes that may befall a service member because of impaired health. In this article, we introduce an innovative method for estimating the future health costs for currently deployed service members that is well equipped to handle and quantify the uncertainty embedded in such a calculation: microsimulation modeling. Unlike standard accounting methods, a microsimulation model takes a hypothetical group of simulated individuals and predicts future cost-related events, allowing the simulated population to experience mental conditions, mental health treatment, and secondary outcomes such as employment. An advantage of the microsimulation approach is that it can treat mental disorders as chronic conditions, allowing for both remission and relapse over time. In addition, the micro- simulation model can be useful for evaluating different policy scenarios. In our case, we were particularly interested in asking the following policy question: If we increase the use of evidence- based treatment, will we save money in the long-run? This type of question would be difficult to evaluate in a standard accounting framework because standard accounting models are based on av- erage expenditures for a population and do not allow for different individuals to experience different treatments, subsequent out- comes, and costs. Data to parameterize the model, including in- formation about the probability of developing mental illness and the probability of remission following treatment, were taken from existing literature. We constructed a simplified microsimulation model that en- abled us to characterize the social cost over a 2-year period for two well-publicized and extremely prevalent health conditions associ- ated with combat exposure: posttraumatic stress disorder (PTSD) and major depression (Hoge, Auchterlonie, & Milliken, 2006;