Hunt shaping reforms to stretch the health budget

Given a choice, many patients would prefer to be cared for at home rather than in hospital during treatment for chronic diseases, mental health problems and while undergoing rehabilitation. The fact home treatments, in many cases, have a discernible health benefit for patients compared with hospital treatments is an opportunity to reduce costs while not compromising on quality, as health editor Natasha Robinson reported on Tuesday. An expansion of home hospital services will be part of a new National Health Reform Agreement, currently in the advanced stages of negotiation between federal Health Minister Greg Hunt and the states and territories. Negotiations also are proceeding with private health insurers and private hospitals to allow greater funding of healthcare outside hospitals.

The proposal is timely. Australian Institute of Health and Welfare data shows that almost 10 per cent of all hospital bed days in 2017-18 were potentially preventable. Last week, The Australian reported that the nation’s public hospitals were “stretched to the max” and were beginning to buckle under the strain of an ageing population that is living longer, having more operations and experiencing greater prevalence of chronic disease. Treasury’s next intergenerational report is due in July. But the likely impact of our ageing population on health budgets, at a time when the number of taxpayers will shrink as a proportion of the overall population, is already emerging. This year, the federal government will inject $23.6bn into hospitals, a figure that is set to rise to $29.1bn in five years.

The pressures, especially in emergency departments, are being compounded by a shortage of GPs, especially in rural and remote areas, which is leaving some patients with no option other than to seek treatment at public hospitals. Since 2017-18, the number of patients presenting to emergency departments has increased by almost one million.

In response to the shortage of rural GPs, the government is backing a proposal by doctors’ groups that would see rural GPs recognised as specialists and paid more for some of their work. The plan would recognise “rural generalist” as a new speciality, acknowledging the broad skills of bush GPs, who routinely are required to deliver babies, administer ­anaesthesia, perform surgery and respond to mental health emergencies.

Fifteen years ago, the Productivity Commission warned governments to prepare for the likely impact of the ageing of the population on health expenditure. In all developed countries, it said, health expenditure on those aged over 65 was about four times higher than expenditure on those under 65; and the figure rises to between six to nine times higher for the oldest groups. In addition to better and more expensive treatments and medications, growing incidences of chronic diseases, such as diabetes, have placed increasing burdens on the system. For that reason, “hospital in the home” has much to offer patients and taxpayers.