Towards a healthy policy vision for Australians

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The ultimate goal of the health system is improvement in health status of all Australians and the provision of safe, efficient and effective health care. Health policy should support the achievement of this goal.

Is this goal achievable when the present health system is under stress from increasing budget and demand pressures, which render its  quality of care, efficiency and equity unsustainable? Is this goal achievable when health policy supports the current duplication of services and the imbalance in funding between primary and acute care?

Many argue there is no ‘health system’ at all. Hospitals and health services tend to work independently and compete with each other. State and federal governments are constantly shifting costs and blame.

Although the Australian population is ageing it is a relatively healthy. However, there is a high incidence of chronic, preventable diseases. The burden of disease profile (defined as the years of healthy life lost due to disability and premature death) for attributable deaths in Australia is: smoking 13%; high blood pressure 11%; inactivity 10%; obesity 5%; cholesterol 5%; and poor diet 3%. It is estimated that chronic diseases such as cancer, heart disease and stroke, kidney disease and diabetes account for around 80% of the total burden of disease.

Aboriginal people have a very different demographic profile and much poorer health outcomes than other Australians. If all Australians had the health status of the Aboriginal population, Australia would rank around 140 in the world, equivalent to life expectancy in Bangladesh.

Health policy needs to reflect these changing and differing demographics and outcomes by varying how we should fund and what we should fund.

How health should be funded
A major system problem is the divided responsibility between the Commonwealth and State Governments, which results in inefficiency, fragmentation, gaps, cost and blame shifting In recent State and Territory health reviews, this problem was continually raised.

One obvious example is the pressure on State hospital emergency departments caused by inadequate funding and/or management of general practice services in the community. This falls under Commonwealth responsibility for funding. Another example is the shortage of Commonwealth-funded aged person facilities, which results in aged and frail persons unnecessarily and expensively remaining in State acute hospitals for long periods of time. In the UK the Ministry responsible for funding aged care is charged for every day a person is in hospital due to a lack of an aged care placement or service.

The best solution would be for State governments, singly or jointly, to cede their health powers to the Commonwealth Government to achieve a unified and national health service. However, such an approach is unlikely to occur. An alternative is a joint Commonwealth/State Health Commission in any State where the two governments could agree. The joint commission, with shared governance, would be responsible for the funding and planning of all health services in that State. Consistent with an agreed plan, the Commission would then purchase health services from existing providers – Commonwealth, State, local, NGO and private.

What should be funded?
In health there is a term ‘Compression of Morbidity’ which describes the phenomenon where the onset of chronic disease and disability are deferred and therefore morbidity (sickness) is compressed between the point of onset and death. 

There is research which shows that health care costs in the final stage of life decreases with age of death. The older one is at the time of death, the less the cost to the acute health system. 

Taken together, this suggests that if a health care system is able to defer the onset of disease and disability in the population faster that it extends length of life, there are overall benefits both to health outcomes and to the financial viability of the health care system.

By implication, the focus on health improvement over the next decade must be on chronic rather than acute disease, on morbidity not mortality, on quality of life rather than its duration, and on postponement rather than cure. There are therefore potentially five areas for investment.

1. Reducing the social and economic disadvantage that drives inequality in health outcomes

Primary health care investments throughout the Australian health care system should be expanded and extended, but not limited, to the following: health services and programs aimed to overcome the health inequalities for Aboriginal and Torres Straight Islanders; childhood nutrition programs aimed at achieving a reduction of obesity for children; parenting programs aimed at improving the early years of a child’s development and supporting new mothers; speech pathology aimed at early treatment of speech disadvantage and consequent educational disadvantage; interventions aimed at reducing the incidence of domestic violence and providing alternatives for victims and children from its long term consequences; and school retention and transition programs aimed at increasing the employability of younger members of society.

2. Programmes which reduce the risk factors related to the onset of disease and disability

Medical science is now quite certain about a range of preconditions that lead to chronic disease and disability. For example, cardiovascular disease has been linked to: high cholesterol; high blood pressure; obesity; inactivity; smoking; stress; diabetes; lung disease; familial history, gender and age. Diabetes is linked to many of the same stress factors as cardiovascular disease, and lung disease is associated with smoking and obesity. Cancers are known to be affected by social behaviours such as smoking, sun exposure, dietary intake and exposure to known carcinogens (e.g. asbestos).

Incentives and rewards should be provided to educational institutions and workplaces that actively support healthy lifestyles; and the attributes of a ‘healthy community’ should be included in all residential planning and development projects.

3. Early Detection of Chronic Disease

In most cases the early detection of chronic disease and cancer provides a significantly enhanced prognosis. There are, of course, some cancers for which no treatment has been successfully implemented, and it is arguable whether there should be screening tests for such cancers. However, for the vast majority of cancers and diseases which cause the bulk of health care expenditure, the earlier the diagnosis the greater the likelihood of deferring the onset of disease-related morbidity and disability, and of extending quality of life.

The Commonwealth Medical Benefits Scheme should be extended to provide funding for screening programs. 

4. Aggressive Management of Complex Chronic Disease and Disability

After the onset of a chronic disease or severe disability attention should focus on maintaining and reinforcing appropriate behavioural self-management, and on a coordinated delivery of appropriate health and community care services. These should be structured and delivered in such a way as to promote independence and self-sufficiency.

That adequate support systems for carers, adequate supply of information to consumers, real partnerships with health providers, and coordinated health services be provided.

5. Appropriate Acute Care Substitution

In many cases patients would prefer to receive the care they need in a community- based setting, and preferably at home. The current Australian health system, however, has a bias towards funding the highly urgent albeit less important care delivery services – usually in acute hospitals. This has left a very low level of investment in the more strategic primary and community care sectors.

That the Commonwealth Medical Benefits Scheme be expanded to include payments for community-based alternatives to acute care.


There are two fundamental issues that need to be addressed – how health care should be funded and what should be funded.  An appropriate change in policy would improve the health status of all Australians while at the same time addressing the health and social inequalities between individuals, families and communities. This policy reform would strengthen the governance of the health system and provide greater choice in health care options. The policy changes would also provide a more efficient health system, minimising duplication and cost shifting and providing a better balance between acute and primary care services. Restructured funding arrangements would also act as a driver in reforming the health workforce.

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