A new funding model for a chronic-care focused healthcare system in Australia

Abstract

Objectives: Significant increases in health expenditures have been a global trend and constitute a major concern in Australia and other countries for healthcare providers, payers, policymakers, consumers and population. This trend is largely attributable to emerging healthcare technologies, aging populations, and the impact of non-communicable diseases and chronic conditions on the burden of disease. In this paper, we look at how the Australian health system is responding to this challenge. Methods: We analyze the main drivers of health expenditure with particular focus on chronic care and integrated care and provide an assessment of the most important problems. Results: The key challenge for Australia is how to reorient and rearrange current health funding and service organization through better design with a specific focus on long-term care and chronic care, prevention and early intervention in the search for efficiency in social and economic impacts and costs. We propose that this is most efficiently achieved through a publicly-funded health insurance model focused on chronic health conditions that we name Mandatory Integrated (Public and Private) Health Insurance (MIPPHI). MIPPHI meets the essential foundational components in terms of competitiveness, efficiency, and affordability. Conclusion: We articulate our proposal for a systematic health funding reform in 22 policy actions that, we argue, would improve the sustainability of the Australian health system while preserving its universal character for a more comprehensive basket of chronic and social services.