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#Budget2015 prescription to cut health costs: invest in prevention

There’s little doubt that “spiralling health costs” will get plenty of Budget Bingo hits when Treasurer Joe Hockey delivers the 2014-15 Budget next Tuesday, 12 May.

Here then is a very timely article from Mary Barry, CEO National Heart Foundation, in response to the Productivity Commission’s recent research report on Efficiency in Health. She notes there is actually a ‘magic cure’ – prevention:

“Policy-makers would do well to also pay heed to its broader conclusion that the benefits of preventive health go beyond the direct impact on people’s health and reduced treatment costs. ‘Good preventive health,’ it notes, ‘can also improve long‑term participation in the labour force, economy-wide productivity and, ultimately, Australians’ quality of life.’

A critical point, especially in these times of fiscal restraint, is that prevention measures do not necessarily come with big price tags or without any price tags at all. Many are not only cost-effective, but cost-saving. Taxes on tobacco, alcohol and sugar sweetened beverages – measures which have substantial public support – can raise much needed revenue, some of which can be used to support greater investment in prevention.

***

Mary Barry writes:

Though it received scant attention, the recent release of the Productivity Commission research report on Efficiency in Health adds more weight to the call for decisive action to tackle the biggest health challenge facing the nation.

Keeping people healthier for longer should be a priority for any government.

And yet, as the Commission’s report states, Australia’s spending on preventive health is low. We are in the bottom third of OECD countries with around 1.5% of total health expenditure allocated for public health purposes. That’s well behind high performing nations such as New Zealand (7%) and Canada (5.9%).

Prevention is the key to tackling what the Australian Institute of Health and Welfare rightly calls our ‘biggest health challenge’ – chronic disease, now responsible for 90% of all deaths and 85% of the nation’s disease burden.

It’s emphatically included in the World Health Organisation’s global chronic disease targets and indicators, signed off by all WHO members in 2013 following the United Nation’s second health summit in 2011 (the first was HIV/AIDs in 2001).

The WHO members agreed to focus on four major disease groups – including heart disease and cancer – and six major risk factors: tobacco use, physical inactivity, salt intake, harmful use of alcohol, obesity/diabetes and raised blood pressure.

And while Australia is a global leader in many aspects of tobacco control – to the credit of politicians of all political persuasions – we are falling well short of the mark when it comes to addressing other modifiable risk factors.

Modest investment in prevention and early detection can significantly reduce the incidence of Australia’s biggest chronic diseases and help prevent premature death and disease.

It’s a point not lost on the Commission, which rightly points out that many researchers and organisations (including the Heart Foundation) have argued that Australia is ‘missing good opportunities to invest in preventive health.’

The Productivity Commission’s report highlights that in Australia, as in other countries, chronic diseases such as cardiovascular disease, diabetes and cancer represent a growing share of the overall disease burden. It also notes that an estimated one-third of Australia’s total disease burden is attributable to modifiable risk factors.

One useful approach taken by the Commission to identify ways to improve the efficiency of the health care system ‘through reforms that can be delivered without changing existing institutional and funding structures, and without delay.’

It has, in effect, identified cost-effective investment in prevention as a way of achieving greater efficiency in the system – and one that can be done within the existing system.

It recommends, among other things, that all governments – state, territory and federal – trial and evaluate prevention measures as a matter of routine. It also calls for a review of the health system to include ‘options to strengthen incentives for cost-effective investment in preventive health.’

It does this because ‘fragmented funding and policy responsibilities’ can weaken incentives to implement cost-effective, evidence based measures, concluding that ‘addressing these issues is crucial to capitalising on prevention opportunities.’

Policy-makers would do well to also pay heed to its broader conclusion that the benefits of preventive health go beyond the direct impact on people’s health and reduced treatment costs. ‘Good preventive health,’ it notes, ‘can also improve long‑term participation in the labour force, economy-wide productivity and, ultimately, Australians’ quality of life.’

A critical point, especially in these times of fiscal restraint, is that prevention measures do not necessarily come with big price tags or without any price tags at all. Many are not only cost-effective, but cost-saving. Taxes on tobacco, alcohol and sugar sweetened beverages – measures which have substantial public support – can raise much needed revenue, some of which can be used to support greater investment in prevention.

Regulation can also be used, for example, to improve information disclosure, protect children from advertising of energy-dense, nutrient poor foods and decrease salt content of processed food.

Investment in early detection of people at high risk of diseases such as heart disease, stroke, kidney disease and diabetes, should also be supported so we can stop disease before it starts.

Much can – and should – be done to improve our national approach to prevention. It can be done quickly and it can be done in a way which is highly cost-effective or even cost-neutral.

Though far from perfect, policy makers across the political divide need to take note of reports like that of the Productivity Commission. And they must commit to making prevention a national health priority.

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