Government spends more on health but out-of-pocket costs spiralling

Government spends $7485 per person on health costs, but out-of-pocket costs a concern.

Government spends more on health but out-of-pocket costs spiralling

The Government spent $185.4 billion on health services and products in 2017-18 – or $7485 per person – according to a report released yesterday by the Australian Institute of Health and Welfare (AIHW).

Spending increased by $22.2 billion or 1.2 per cent, which was lower than the decade average of 3.9 per cent.

The report found that patients spent $3.9 billion on out-of-pocket hospital expenses in 2017-18, up $560 million or 17 per cent over the financial year, and quadruple the amount spent a decade earlier.

Specialist out-of-pocket costs increased by almost $200 million in 12 months, and GP out-of-pocket costs rose by $38 million.

We also spent $9.4 billion on medicines and pharmacy products not listed on the PBS.

The Age reports that the AIHW figures show the growth in federal health spending in 2017-18 was almost four times slower than the increase in tax revenues.

“The Coalition government spent $77.1 billion on health in 2017-18, up 3.4 per cent on the previous year, while it collected $308.7 billion in taxes – an increase of 12.6 per cent.”

Grattan Institute health economist Stephen Duckett said the growth in out-of-pocket costs was “a serious concern, especially at a time when household budgets are under pressure because of flat wage growth”. He added that future reforms to the private health insurance system must examine in-hospital out-of-pocket costs.

“It may mean people will find it harder to afford to see a doctor, with long-term health consequences,” he said.

Dr Duckett said that while the number of GP services to be bulk-billed had risen over the same period “for those who are not being bulk-billed, the out-of-pockets are going up – and for specialists, there’s just basically no control over their fees”.

He said the Government needed to do more to address overcharging by specialists and that Health Minister Greg Hunt’s promised fee transparency website was “never going to work” because it was voluntary.

Contributions to health spending by private health insurers rose by $400 million to $16.6 billion; however, the number of people with private health cover dropped in the 12 months between 2016-17 and 2017-18 by about 33,000 to 11.3 million – the first decrease over the past decade.

In 2017–18, private health insurers spent an average of $1470 per person covered, compared with $1043 in 2007–08.

The $30.6 billion Australians spent on their health included $9.4 billion on medicines and pharmacy products not listed on the PBS; $6 billion on dental, and $4 billion on medical specialists and allied health professionals such as physiotherapists, optometrists and podiatrists.

If you enjoy our content, don’t keep it to yourself. Share our free eNews with your friends and encourage them to sign up.

RELATED ARTICLES





    COMMENTS

    To make a comment, please register or login
    Karl Marx
    26th Sep 2019
    10:19am
    Watch SBS insight from this week titled Out Of Pocket, Season 2019 Episode 31
    80 plus
    26th Sep 2019
    11:22am
    we are a couple in our eighties with the top level of cover, our subscriptions are $379.85 a Month after a specialist consultation to discuss a procedure we were billed $850, the gap was $733, after the procedure was carried out we were billed for $783 the gap was $741 our fund all so covers us for reproductive heath issues and male sexual health problems! but not it seems for life saving surgery
    Anonymous
    26th Sep 2019
    12:16pm
    A shocking indictment of the greed of many in the medical 'profession', and of these self-style and self-serving 'benefits funds' .... taking candy from pensioners in wheel chairs....
    Nenezy
    26th Sep 2019
    11:49am
    Greedy. We live in a society where the privileged get so much more than they need. I do not accept the explanations given on behalf of doctors (Insight) as to why they have to charge SO much. Specialists, politicians, Pharmacy, CEOs, There is now a huge discrepancy between the lowest (Newstart) and the highest (Qantas CEO).

    26th Sep 2019
    12:15pm
    No good calling on government to resolve the impasse they've helped create.... apart from their direct culpability in 'designing' this 'system' so that it is fatally flawed, there is a need for people to begin to step back from adopting the "Big Daddy Government Will Solve It For Us"approach to any and every problem, and start exercising real focused People Power.

    That, BTW, includes 'business' and their never-ending reaching out to governments to resolve their own inabilities and ineptitudes... for example in negotiation with a workforce .. makes you wonder how such infants ever got to be wearing a suit at all ..... if 'business' is so good at producing results, why are they forever running to Big
    Daddy to resolve their own shortcomings and give them cash handups?

    Just saying - once again, my point is that the 'business model' of providing healthcare, like all other such models, has failed to deliver.... but don't hold your breath waiting for Labor to fix that.... they benefit too, and silver bullets won more battles than lead ones.... ...
    Anonymous
    26th Sep 2019
    12:18pm
    Gee - I guess that makes me some form of "Trotskyist" - not that I accept any such labels.... my only political affiliation is to the people first and foremost....
    Milly
    26th Sep 2019
    1:12pm
    Years ago I worked for a healthfund and even though some things change I try hard to stay abreast of what's what and think I'm a little more fortunate in having a slightly better understanding on how they operate than the average jo blow. The thing that really gets under my skin is the gap charges. Where I live in a regional town there is no use saying to just find another surgeon because there isn't many usually just one or two if you are lucky.

    I have a good health fund (and not the one I used to work for), I am fully covered for everything there is a MBS number for (bar that rotten gap of course). My plan is grandfathered but I still check it every year. (I don't trust anyone). The things I do which others may find helpful is to check your coverage every year by actually reading the PDS. It is also very helpful to befriend a receptionist and even though they will not say on record you can find out which funds pay the best meaning that there is less likely to have a gap and if there is it will be less. The big three and their underwritten children are the worst payers where the smaller independent ones much better.They are usually under a gap scheme called ASHA. There is the AMA Report card which is something to look up and it gives a pretty good idea on what companies pay and gaps etc. If you google AMA Private Health Insurance Report Card you will see the PDF document which makes interesting reading. There is a bit of scrolling before you get to the tables of what costs what.

    I know it will never happen but I would love it if the surgeons all charged the AMA fee and the PHI paid up to the AMA fee leaving no out of pocket. The doctors would be paid fairly for their work but not overpaid. AAhh wouldn't a perfect world be lovely
    Tanker
    26th Sep 2019
    1:37pm
    Milly it is unfortunate that we live in a "Greed is Good" world at the moment with a government seemingly hell bent on getting us into an American style heath system.
    God help us.
    So many specialists are simply overcharging because they can as the government won't do anything to stop them. They have the most powerful trade union in the country, the AMA, and no politician is brave enough to take them on.
    Tanker
    26th Sep 2019
    1:37pm
    Milly it is unfortunate that we live in a "Greed is Good" world at the moment with a government seemingly hell bent on getting us into an American style heath system.
    God help us.
    So many specialists are simply overcharging because they can as the government won't do anything to stop them. They have the most powerful trade union in the country, the AMA, and no politician is brave enough to take them on.
    80 plus
    27th Sep 2019
    9:32am
    thank you Milly for the web address IT SEEMS I am with one of the best Health Insurance providers, the graph showing an increase in profits of over 300% in the last ten years was a revelation as was the graph showing the large increase in exclusions. health care professionals are the new robber baron generation.

    26th Sep 2019
    2:33pm
    All of these rapacious medicos are superb at performing the walletectomy - removing as much cash as they possibly can from our wallets, The sooner the government instigates a royal commission into the entire sector, the better for the long-suffering public.
    inextratime
    26th Sep 2019
    4:54pm
    Tanker, to save us reading two posts because of the technical hitch in the system (it happens to me) you can delete one of them immediately after posting. Also saves space,
    inextratime
    26th Sep 2019
    5:01pm
    I agree with the comments on here. I wonder how many people have gone without a specialist treatment because its unaffordable ? I had a skin cancer removed which took all of 15 minutes and the gap was $67 for the initial consultation and $123 for the cut. Total bill was in the order of $550 nice work if you can get it.

    26th Sep 2019
    8:42pm
    “The Coalition government spent $77.1 billion on health in 2017-18, up 3.4 per cent on the previous year, while it collected $308.7 billion in taxes – an increase of 12.6 per cent.”
    Elsewhere, the article says "The Government spent $185.4 billion on health services and products in 2017-18".
    So, which is the correct figure of what the Fed Govt spent?

    In any case, if $308.7 Billion was collected, why was it not all spent on Health? So many Questions which no one in Parliament asks these Govts (Liberal or Labor). Another reason why all MPs need to be sacked at each election until they start working for the people.

    That said, the only use of having Private Health Insurance would be if it covered ALL Gaps, i.e. ALL Risks. Otherwise why have this Industry? We are seeing an industry gradually shutting down, unless it and the Govt wakes up.
    Doctors Unions also can share the blame for massive out-of pocket costs - again with the Govt looking on - politicians keeping quiet here too, and NOT working for us.
    Incognito
    29th Sep 2019
    7:27pm
    so many sick people in this day and age, you cannot afford to be sick or need surgery, prevention is looking better every day. Before the 1930's natural herbal medicine was the main medicine and many problems were solved at home, there are still many cultures still doing this because they cannot afford western medicine. Time we started taking our health back into our own hands, stop all the minor issues taking up the costs and leave the money to more serious issues and surgery.


    Join YOURLifeChoices, it’s free

    • Receive our daily enewsletter
    • Enter competitions
    • Comment on articles