Australia has long punched above its weight when it comes to health outcomes and access to treatment, the world’s first cervical cancer vaccine, spray-on skin and the cochlear implant come to mind.
But to keep it that way for all of us, we must invest in the health transition.
The challenges in healthcare are well known.
We see the impact of these challenges every day. From decade-high waiting lists in public hospitals and ongoing ambulance ramping, delays to see a GP or a specialist, and a stretched health workforce.
Changing demographics are one of the biggest drivers, with the number of people over 65 in 2050 to be almost three times what it was in 1970. And we are not looking after ourselves as we could, with half of all adults now living with at least one chronic condition.
These demographic shifts have a cost. If we don’t act, the government will need to spend nearly 50% more on health as a proportion of GDP in 40 years’ time, with hospital spending the fastest growing part.
There is no doubt that hospitals play an integral role in our health system and will remain vital for providing expert care in the future. But we are currently over-reliant on treatment in more expensive acute hospitals, rather than in other more fit for purpose settings.
The past few years have been challenging for the hospital sector, especially since the start of the pandemic. But there are both short-term and long-term forces at play that are distinct.
In the short term, inflation has been driving up costs for hospitals, and we have been supporting our hospital partners with substantial financial support.
But also, in recent years acute higher cost hospital bed capacity in the private sector has been growing ahead of demand – now with only about 2 in 3 hospital beds being utilised. This growth in private hospital capacity is a result of capital investment decisions that were made years ago.
Yet over the long term, customers have been looking to options for treatment in other settings – including treatment with shorter hospital stays, treatment in primary care or in day hospitals, and care provided in the comfort of their own home.
From our patient surveys we know that most people don’t want to go to a hospital if they can avoid it, and where clinically appropriate, these new models are better for patients and are better for the affordability of the system.
Like Medibank customer Leanne, who through our Better Knee, Better Me program (designed to help manage painful knee osteoarthritis and potentially avoid a knee replacement) lost 25kg on the program while travelling around Australia in her caravan with her husband Terry.
So, in the longer term, this is the transition we need – from a hospital system to a health system.
There’s also a pressing opportunity to take a more proactive approach to health. Australia spends more than $38 billion annually on care for people with chronic health conditions, yet more than a third of the chronic disease burden is preventable. As we know, prevention is often better than cure.
This health transition has started. The structural changes are big and complex, and they require a fundamental and long-lasting shift in our approach.
And it could make a huge difference to how we care for Australians, with the potential for around 1.7 million people each year to be treated in settings that are better for them and more efficient for the system – with the acute hospital capacity available for those that really need it.
To ensure we can all continue to access some of the best health outcomes in the world, we need to embrace the health transition. That’s what will help drive long term affordability for all of us and will sustain the health system.
This transition is underway in other parts of the world, with Australia trailing many countries in the uptake of these more contemporary models of care.
If they can do it, so can we.
The opportunity is huge – and so is what’s at stake.
But we need to be moving faster to continue to meet the needs and expectations of Australians. Providing people greater choice and control in their health – choices about where they receive their care and control about how much they are prepared or can afford to pay for it.
And with cost-of-living pressures biting, to expect consumers right now to foot the bill for decisions of the past doesn't just seem unfair, it's wrong.
We are lucky in Australia and sometimes we forget that. We can’t become complacent.
We need a strong public-private health system fit for the long term.
We need to work hard now to sustain our health system for the future and that means investment in the health transition.
And as with any system-wide shift, we need to work together. Change in health is never easy. And while there are many vested interests, complex funding models and regulatory constraints to navigate, these must not be cause for inaction.
The pandemic saw the various parts of the health system work together like never before. We got a taste of what is possible. It’s time to come together once more – for the long term.
The path to create a better future is clear, but we simply can’t go fast enough. Our country deserves that.
Medibank CEO
David Koczkar