Governments cough up just $140 in public health spending per Aussie

A new study analyses and maps public health funding from both federal and state/territory governments but the researchers are left asking questions.

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Australia spent $140 per person on public health efforts like infectious and chronic disease protection, prevention and health promotion in 2019-20 – less than 2% of total health spending, a new study has revealed. 

And the researchers, whose findings were published in the Australian and New Zealand Journal of Public Health, say a lack of transparency “makes it very difficult to hold jurisdictions to account for the things they choose to fund, and, as importantly, for the things they choose not to fund”. 

“The current funding model has two major strengths: a commitment to delegate authority for deciding how funds should be spent to decision makers who are closer to the problems; and the use of an array of funding mechanisms, which, in theory, allows the choice of funding method to be determined by the characteristics of the specific activity being supported,” they wrote. 

“There is evidence of this level of deliberation, especially in the way that national screening programs are funded. 

“Much of the funding model is obscure, however; hidden from view behind piecemeal or absent reporting and occasionally idiosyncratic categorisation of what counts as public health.” 

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The study is the first to analyse and map public health funding from both Federal and State/Territory Governments. It was funded by The Australian Prevention Partnership Centre, a research, policy and practice collaboration and Centre of the Sax Institute.   

It reported that in 2019-20, 1.8% of overall health spending (or $140 per person) was allocated to public health initiatives, though the amount varied among states and territories. For example, the Northern Territory spent $527 per person on public health, while Victoria spent just $110.  

Public health experts said the research demonstrated the need for a new government model to ensure that public health spending had maximum impact and was visible.    

Lead author Emeritus Professor Alan Shiell from La Trobe University said that “the effectiveness of public health funding isn’t just determined by how much funding is given, but also how it is allocated”.   
 
“Our research uncovered a complex and piece-meal funding system,” he said. 

“While delegating funding decisions to the states and territories who understand local need is a strength of our current model, it leaves the public in the dark about exactly where the money is going and exactly how much is being spent on public health.   
 
“It also makes it very hard for us to assess what difference public health spending is making.”   
 
Adjunct Professor Terry Slevin, CEO of the Public Health Association of Australia, said that as well as greater transparency, the study demonstrated the need for a new government funding model for prevention to ensure that the health budget was effectively spent.  
 
“After a clear ‘spike’ in public health spending due to the pandemic, investment in this area looks to have returned to pre covid levels.  
  
“We have a sophisticated system to determine the best investment in medicines – the Pharmaceutical Benefits Scheme (PBS). We need a similar system to ensure that proven, cost-effective public health programs receive consistent funding.  
 
“This would help ensure more consistent and effective health spending to help everyone in Australia live healthier lives.”  

The researchers made three specific recommendations that would allow “rigorous examination of whether the system’s performance can be improved by changes to the funding model and/or the country’s investment in prevention” and improve the transparency of public health funding decisions in Australia. 

These include resurrecting the Australian Institute of Health and Welfare’s detailed reporting of annual public health spending. The last such report (in what was an annual series) reported spending for 2008-2009 and appeared in 2011.  

The series covered both levels of government and provided a breakdown of expenditure over time, and against each of eight core public health activities, including communicable disease control; selected health promotion programs; organised immunisation; environmental health; food standards and hygiene; screening programs; prevention of hazardous and harmful drug use; and public health research. Trends and significant changes in the share of spending going to different activities were noted, as were some of the reasons for taking care when comparing spending across jurisdictions. 

“Resurrecting the series would signal the important and distinct role played by public health in the wider health system despite its small share of resources,” the researchers wrote. 

“It would add fuel to the commitment to reconsider the share of total health spending going to public health, and, if done well, that is in following the other suggestions we make here, it would aid and encourage deliberations about priority setting and resource allocation.” 

The researchers also recommended the use of AIHW definitions of public health when reporting public health spending. 

“To be effective the annual reporting series would need the buy-in of the jurisdictions to ensure the accuracy and comparability of the spending data,” they wrote. 

“Our second suggestion supports this aim by requesting that the jurisdictions in both levels of government be more assiduous in their use of the AIHW definitions of public health when classifying their spending and reporting the budgets associated with public health activities. Current practice, which occasionally looks rather idiosyncratic in the way it aggregates and sometimes misclassifies spending, may be expedient but it hides how much is really being spent on public health and undermines efforts to hold jurisdictions accountable for what they do and do not do to support public health. 

“For the original AIHW series, a financial carrot was provided to the states and territories in the Special Purpose Payments (the forerunner of the current National Health Reform Agreement). Something similar needs to be considered with the next NHRA.” 

The third suggestion addressed the boundary issues relating to what counts as public health.  

“The AIHW approach to compiling the health expenditure database fulfils many functions, not least in allowing comparisons of spending to be made consistently among jurisdictions within Australia, within jurisdictions over time, and internationally between Australia and other OECD countries,” they wrote. 

“Their approach draws a boundary around public health that is logical, principled and, largely, replicable, but it is quite tight. The resulting financial accounts are neither comprehensive nor entirely in keeping with contemporary interest in addressing the social determinants of health. 

“Changing the definition of public health that is used by the AIHW to be more embracing of contemporary practice has its attractions. It would legitimise and signify the value of many public health practices that are not currently included in the accounts (action to tackle the social determinants of health for example), and it would help to maintain a degree of accountability regarding inter-sectoral action. 

“But this would also undo the extensive efforts that the AIHW, along with state and territory health bureaucrats and their international peer agencies, have made to standardise accounting approaches.”  

They said the benefits of widening the definition of public health could instead be achieved in a less disruptive way.  

“The AIHW’s processes, and those followed internationally in the OECD, allow for the periodic compilation of ‘satellite accounts’, which supplement the main expenditure statements,” the researchers wrote. 

“Satellite accounts widen the scope of the published expenditure data without requiring permanent changes in definition. This facility can be applied in two ways: first to allow expenditure items that are already counted as health expenditures to be regrouped in ways that are relevant for different purposes, and second to draw into the health accounts spending that is not currently defined as health expenditure but which contributes to public health. 

“The first of these would allow health system spending that is already defined as ‘public health’ by the AIHW, but which cannot be counted as such because of data collection issues, to be included in the annual reporting of public health spending.  

“This would ensure that clinical prevention, especially in primary care, could be counted in public health expenditure as an occasional special exercise. The second would enable local government spending (which supports about half of all childhood vaccinations in Victoria but is not included in the AIHW’s statements), and national, state and territory government action on the social determinants of health to be drawn into the public health accounts on a one-off basis.” 

Both exercises would require special surveys to aid data collection and additional data analysis, but the result would be a more comprehensive understanding of the actions being taken in Australia to promote public health, including the level of investment made by each level of government and their commitment to tackling the social determinants.  

The results would provide a firmer basis for discussions about broad public health policy and priority setting.  

“The use of satellite accounts in this way will not get around the immense challenges of delineating public health from clinical practice at one end of the scale, and social and economic interventions at the other end, but it will allow the consequences of different ways of operationalising the definition of public health to be explored without cementing those changes permanently into practice,” they wrote.