Background Referral to psychological therapies is recommended for people with common mental health problems (CMHP) however its impact on healthcare utilisation in people with long term conditions (LTCs) is not known. Method Routinely collected primary care, psychological therapy clinic and hospital data were extracted for the registered population of 20 practices (N = 121199). These data were linked using the SAPREL (Secure and Private Record Linkage) method. We linked the 1118 people referred to psychological therapies with 6711 controls, matched for age, gender and practice. We compared utilisation of healthcare resources by people with LTCs, 6 months before and after referral, and conducted a controlled before and after study to compare health utilisation with controls. We made the assumption that collection of a greater number of repeat prescriptions for antidepressants was associated with greater adherence. Results Overall 21.8% of people with an LTC had CMHP vs. 18.8% without (p < 0.001). People with LTCs before referral were more likely to use health care resources (2-tailed t-test p < 0.001). Cases with LTCs showed referral to the psychological therapies clinic was associated with increased antidepressant medication prescribing (mean differences 0.62, p < 0.001) and less use of emergency department than controls (mean difference −0.21, p = 0.003). Conclusions Referral to improved access to psychological therapies (IAPT) services appears of value to people with LTC. It is associated with the issue of a greater number of prescriptions for anti-depressant medicines and less use of emergency services. Further studies are needed to explore bed occupancy and outpatient attendance.