Report: Childhood trauma costs Kentucky nearly $300 million every year

Adverse experiences in childhood and their lasting consequences cost Kentucky nearly $300 million a year, a new report says.

Kentucky Youth Advocates and Bloom Kentucky, a KYA initiative focused on reducing childhood adversity, on Monday released an analysis, called “The Economic Impact of Adverse Childhood Experiences in Kentucky” that shows health care costs and loss of workforce participation as a result of childhood trauma comes with a $295 million annual price tag. 

The analysis is based on Behavioral Risk Factor Surveillance Survey data from 2015–20. At that time, 62% of Kentucky adults said they’d had at least one adverse childhood experience or ACE  and 19% reported four or more. 

ACEs are traumas or stressors in a person’s life before their 18th birthday. They include, but are not limited to, parental divorce, abuse, parental incarceration, substance use issues in the home and more. The more ACEs a person has, the more likely they are to have poor health, lower education and economic hardships. 

When these stressors become chronic, it “has an impact on our physiology,” explained Shannon Moody, Kentucky Youth Advocates’ chief officer of strategic initiatives. 

The more ACEs a person has, the more likely they are to turn to unhealthy practices like smoking, according to the Centers for Disease Control and Prevention. ACEs survivors also tend to report poorer mental health, may be unemployed and are more likely to have chronic health issues like diabetes and cancer, according to the CDC. 

“The ways that our body absorbs stress or deals with stress has an impact on our physiology as well as on our mental health,” Moody said. “When that stress goes unaddressed in our bodies, it starts to take a toll on how our bodies’ function.” 

The result is sicker people who may not be able to work and contribute to the economy. 

“If we don’t invest in making sure that kids can overcome the adversity that they are (facing) — or maybe prevent it if it is preventable — we’re going to end up absorbing the costs through our state budget,” Moody said. 

What’s in the report? 

According to Monday’s analysis: 

• The most common type of ACEs in Kentucky is divorce with 32% of adults reporting they lived through their parents splitting when they were children. A close second, 31% of adults reported there were substance abuse issues in their childhood home. 
• ACEs cost Kentucky — both in medical spending and in lost income when people cannot work — nearly $300 million each year. Among these, smoking costs more than $107 million each year in lost wages. 
• Depression costs the state the most in treatment expenses at $728,000 annually. 
• Kentucky has higher expenses per person in treating ACEs than most of its neighboring states. 
• People with at least one ACE are more likely to be unable to work or be out of work. 
• Non-white Kentuckians are more likely to have experienced ACEs than their white counterparts. Multiracial Kentuckians have the highest rates of ACEs. 

“Given how common ACEs are in Kentucky, organizations, agencies and decisionmakers must take trauma into account when working to strengthen communities,” the report says.  “Understanding the widespread impact of trauma begins with learning both its effects and the potential pathways to healing.” 

That includes creating better access to quality child care, Moody said, and creating a state child tax credit. Combating poverty, which affects 20% of Kentucky’s children and for many means they don’t have reliable sources of nutritious food, is key as well. 

She also stressed the importance of positive childhood experiences (PCEs), which can balance children’s adverse experiences. PCEs can include feeling supported by friends, having adults who care, the ability to talk with family members about feelings and more.  

“Even if a child is experiencing adversity, even if they have an ACE score of 7, or they have had just a really tough environment in which they were raised, we can counterbalance those adversities with positive childhood experiences,” Moody said. 

Why now? 

The report is coming out now, Moody said, because work on the 2026 state budget is beginning and because proposed federal funding cuts to safety net programs like Medicaid and SNAP put people at risk of more instability and more adverse childhood experiences. 

The report is a call to action, she said, to invest in child wellbeing and prevent ACEs. 

“We need to get an understanding among all of our decision makers as far as what the implications of childhood adversity mean for our bottom line,” Moody said, “and for the investments that they’re making right now on behalf of kids.”