Researchers from Monash University have analysed data from the Australian Bureau of Statistics' national study of mental health and wellbeing, showing the higher rates of illness.
They found more than half of cisgender non-heterosexual Australians and more than one third of transgender Australians are diagnosed with a mental disorder.
Their research shows Australians who identify as lesbian, gay, bisexual, transgender, queer, intersex, or otherwise LGBTQI, have up to 3.5 times higher risk of experiencing high psychological distress than the rest of the population.
More than two-in-five cisgender non-heterosexual Australians (41.3 per cent) and 27.2 per cent of transgender Australians reported high or very high psychological distress, compared to 15.5 per cent among cisgender heterosexual Australians.
Anxiety was the most widely reported mental health condition.
The findings highlighted the severity of the impact of mental health inequities on the LGBTQI community, Monash School of Public Health and Preventive Medicine senior researcher Long Le said.
"These findings were really startling and show that we still have a long way to go in breaking down the barriers to access and treatment for LGBTQ+ Australians," Dr Le said.
"Many LGBTQ+ Australians continue to face stigma, discrimination, social exclusion, and barriers to accessing affirming healthcare.Â
"These experiences can have profound and lasting effects on mental wellbeing and day-to-day functioning."
The study also found LGBTQI people experienced greater impacts on their daily functioning, with functional disability scores 11.1 per cent higher among cisgender non-heterosexual people and 8.7 per cent higher among transgender people.
Study co-author Rebecca Smith, from LGBTIQ+ Health Australia, said the findings provided important evidence that could be used to inform policy.
"Governments and service providers must recognise that LGBTIQA+ community-led organisations and lived experience leadership are fundamental to effective mental health responses, bringing the knowledge, trust and community connection needed to achieve better outcomes," Ms Smith said.
She stressed mental health disparities were not an inherent result of being LGBTQI.
"They are shaped by factors such as discrimination, stigma, minority stress and broader social determinants of health, which means solutions must extend beyond individual treatment and address the systemic drivers of poorer mental health outcomes."
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