Tough choices needed on SA health spending

South Australians must make some tough choices about the value of their public health spending to reduce the sector's burden on the budget, SA Minister for Health and Ageing Jack Snelling told a CEDA Health review in Adelaide.

Mr Snelling told the forum that while revenue and activity over the past decade have grown about two per cent a year, health spending had grown about eight per cent a year and now consumes about 30 per cent of the State's budget.

The sector could not continue to grow unfettered at the expense of spending in other sectors such as child protection, disability services and roads maintenance, he said.

"It's time for a mature debate about what the public wants and what they are willing to pay for in healthcare and other areas," Mr Snelling said.

This included focusing on the quality of life impact of clinical treatments such as those for aggressive brain tumours or dialysis for elderly and frail people with multiple complications. The value of health spending needed to be re-cast in terms of the quality of survival rather than survival alone, he said.

"Patient-centred outcomes research looks at end points other than mortality to assess the value of an intervention. It asks, what is the quality of survival, what is the reduction in distress - what interventions have made a difference from the patient's perspective," Mr Snelling said.

Policy makers must consider reducing funding for treatments proven to provide little or no benefits for patients, he said.

The forum, which also included Ernst and Young, Lead Partner, Jim Birch, Southern Cross Care, CEO, Andrew Larpent and RAA, general manager public affairs, Penny Gale, heard that technological innovation in aged care, allowing people to look after themselves at home and remain mobile, could significantly reduce healthcare costs and improve the quality of life for older Australians.

The forum heard:

• South Australia is at the centre of a bid for a Cooperative Research Centre on innovation in aged care;
• The aged care system and the health system must evolve from a sickness based model to a wellness based model - for the sake of patients and the public purse;
• South Australia is well placed to translate research into clinical practice in the public health system with the new health precinct around the South Australian Health and Medical Research Institute;
• The fee for service payment system is the largest impediment to an integrated health system;
• Policy makers around the world are increasingly using predictive analysis to target chronic disease prevention strategies on the five-15 per cent of the population likely to cost the system the most; and
• While the US health system was out of balance at the national level, Australia should look to healthcare systems in California and Colorado as producing the best results at least cost.

Mr Birch said an integrated health system would be critical to improving Australia's healthcare, which did not fare well on a comparison of health systems in seven countries.

"We always regard ourselves as having a good healthcare system but we are not quite as good as we might think we are on quality of care and safe care," he said.

"I'm not suggesting hospital systems are dangerous but relative to the others we rate six out of seven."

Australia also fared poorly in terms of coordinated care and the level of patient co-payments or cost of care with Australians paying almost as much as Americans in co-contributions, he said.

"We need to invert the funding model in Australia to be able to reverse the utilisation in public hospital systems," Mr Birch said.

This meant spending more on prevention than acute care which currently accounts for most of the budget, he said.