Australia’s ‘unsustainable’ health spending is a myth The unsustainability of government health expenditure in Australia is a myth that has been carefully nurtured to justify policies to transfer costs from government to the public. Tomorrow’s budget is expected to introduce co-payments for visits to the doctor and other ways to reduce health spending. The government argues that it must do this because health spending is out of control and the new measures are necessary to make Medicare sustainable. But evidence contradicts this argument. A case of bad arithmetic As a percentage of GDP, Australian government spending on health is the tenth lowest of the 33 countries in the OECD database and the lowest among wealthy countries. The 8.3% of GDP spent by the US government, for instance, is higher than the 6.4% spent by the Commonwealth and state governments in Australia. Nor is it true that total health expenditure – government plus private spending – are unsustainable. Australia spends about 9.5% of GDP on health services; the United States spends 17.7%. And while US spending may or may not be good value for money, it hasn’t undermined its economy or sapped the vitality of the country. The fear that the rising share of GDP spent on health will harm the economy or our standard of living – reflected in numerous reports for the government, including the recent National Commission of Audit’s – is probably a result of bad arithmetic.
Posted on: Tue, 20 Jan 2015 07:08:17 +0000
Trending Topics
Recently Viewed Topics
© 2015