• Lesley Russell
• Macroeconomics

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Report cover: Health budget bulletin 2011

04 July 2011The 2011-12 Health and Ageing budget has $3.57 billion in spending over six years, most of which is for mental health and regional and rural infrastructure. This is offset by $1.59 billion in savings including an unspecified amount from the Pharmaceutical Benefits Scheme.

While the rate of spending is well under control, out of pocket costs are not – these continue to rise and hit the poorest the hardest – it both dollar and health access terms.

Also of concern is the lack of policy substance that underpins spending, highlighted by a continuing focus on acute rather than preventive care, short-term funding for long-term needs, initiatives announced and then quickly undone, and sound policy over-ridden by political need. It is also very difficult to track health care spending and programs over time and this leads to a real lack of transparency and accountability.

Real reform is required of the way in which services are delivered and paid for.   At a time when health care reforms internationally are moving to bundled care and reimbursements that reward outcomes rather than activity, Australia’s reliance on fee-for-service is increasing.

For a Government in the middle of reforming health, this is a very prosaic and even archaic budget – one that pays more attention to the health care needs of last century rather than investing in the innovation and strategies for the twenty-first century.