OBJECTIVE: Patients with a combination of long-term physical health problems can face barriers in obtaining appropriate treatment for co-existing mental health problems. This paper evaluates the impact of integrating the improving access to psychological therapies services (IAPT) model with services addressing physical health problems. We ask whether such services can reduce secondary health care utilization costs and improve the employment prospects of those so affected. METHODS: We used a stepped-wedge design of two cohorts of a total of 1,096 patients with depression and/or anxiety and comorbid long-term physical health conditions from three counties within the Thames Valley from March to August 2017. Panels were balanced. Difference-in-difference models were employed in an intention-to-treat analysis. RESULTS: The new Integrated-IAPT was associated with a decrease of 6.15 (95% CI: -6.84 to -5.45) [4.83 (95% CI: -5.47 to -4.19]) points in the Patient Health Questionnaire-9 [generalized anxiety disorder-7] and £360 (95% CI: -£559 to -£162) in terms of secondary health care utilization costs per person in the first three months of treatment. The Integrated-IAPT was also associated with an 8.44% (95% CI: 1.93% to 14.9%) increased probability that those who were unemployed transitioned to employment. CONCLUSIONS: Mental health treatment in care model with Integrated-IAPT seems to have significantly reduced secondary health care utilization costs among persons with long-term physical health conditions and increased their probability of employment.