نبذة مختصرة : Abstract Background Poverty and mental illness are strongly associated. The aim of this study was to investigate the economic impact of implementing a district level integrated mental healthcare plan for people with severe mental disorders (SMD) and depression compared to secular trends in the general population in a rural Ethiopian setting. Methods A community-based, controlled before-after study design was used to assess changes in household economic status and catastrophic out-of-pocket (OOP) payments in relation to expanded access to mental health care. Two household samples were recruited, each with a community control group: (1) SMD sub-study and (2) depression sub-study. In the SMD sub-study, 290 households containing a member with SMD and 289 comparison households without a person with SMD participated. In the depression sub-study, 129 households with a person with depression and 129 comparison households. The case and comparison cohorts were followed up over 12 months. Propensity score matching and multivariable regression analyses were conducted. Results Provision of mental healthcare in the district was associated with a greater increase in income (Birr 919.53, 95% CI: 34.49, 4573.56) but no significant changes in consumption expenditure (Birr 176.25, 95% CI: -1338.19, 1690.70) in households of people with SMD compared to secular trends in comparison households. In households of people with depression, there was no significant change in income (Birr 227.78, 95% CI: -1361.21, 1816.79) or consumption expenditure (Birr − 81.20, 95% CI: -2572.57, 2410.15). The proportion of households incurring catastrophic OOP health expenditure (COOPHE) at the ≥ 10% and ≥ 40% thresholds were significantly reduced after the intervention in the SMD (from 20.3 to 9.0%, p = 0.002, and 31.9–14.9%, p
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