Health system expenditure on disease and injury in Australia: Presentation to OECD Meeting of Health...

Health system expenditure on disease and injury in Australia:

Presentation to OECD Meeting of Health Accounts Experts / 29-30

Sept 2005

Health system expenditure on disease and injury in Australia:

Presentation to OECD Meeting of Health Accounts Experts / 29-30

Sept 2005

Mr John GossPrincipal Economist

Australian Institute of Health and Welfare

Mr John GossPrincipal Economist


2


Overview of talkOverview of talk

Methods (including SHA adjustments)

Results

Uses of disease expenditure data, including linking of inputs, outputs and outcomes

3


Disease expendituresDisease expenditures

A type of satellite account which splits expenditure

– By disease,

– By age-sex, and

– By utilisation

4



Data for Australia for 1993-94 and 2000-01 have been published

5



A top down approach to allocation of expenditure to disease.

Advantage if that everything adds to 100 per cent

Disease groups err on the side of largeness

Total expenditure using disease expenditure estimates from disease groups is much larger than total health expenditure

6


Australian disease expenditure database for 2000-01; Age groupsAustralian disease expenditure database for 2000-01; Age groups

0-4 5-1415-24 25-3435-4445-5455-6465-7475-8485+

7


Australian disease expenditure database for 2000-01Australian disease expenditure database for 2000-01

Disease expenditures are according to the 176 burden of disease categories.

This enables integration of inputs, outputs and outcomes

8


Burden of Disease chapter headings replaces ICD chapter headings as a means of presenting expenditure at the aggregate level.

9


Differences from ICD chapter structureDifferences from ICD chapter structure

Oral health is a major expenditure (7% of total) so it is advantageous to separate it from the Digestive chapter.

Diabetes is a major and growing expenditure; Therefore separating diabetes from the Endocrine chapter is of advantage.

10


Dementia is in the ICD Mental disorders chapter.Alzheimer’s disease & other specific diseases causing dementia is in the ICD Nervous system chapterMore logical to group all dementias together in the Nervous system chapter. Sense disorders is also a major expenditure item and is separated from other nervous disorders.

11


Methods & data sourcesMethods & data sources

Hospital morbidity

Diagnosis Related Group (DRG) weights but also– adjust for length of stay– adjust for cost of hospital varying from

State average– include private medical services

provided in hospital

12


General Practitioner (GP) pharmaceuticals and encountersGeneral Practitioner (GP) pharmaceuticals and encounters

$ & no. of encounters & type of drugs come from Medicare Benefits Scheme (MBS) & Pharmaceutical Benefits Scheme (PBS) data.

Pattern of scripts written by disease from 1999 to 2001 BEACH data base of GP encounters with patients (300,000 encounters)

13


Specialist drugs and attendancesSpecialist drugs and attendances

– Specialist script dollars and type of drugs from PBS

– Pattern of drugs by disease from BEACH

– Referrals to specialists from BEACH used to allocate out of hospital specialist dollars and encounters.

14


Areas of expenditure not allocated by diseaseAreas of expenditure not allocated by disease

Community mental health included, but rest of community health is not.

Public health. Cancer screening programs included but rest of public health is not.

Aids & appliances not included

Patient transport not included

15


Areas of expenditure not allocated by disease and age-sexAreas of expenditure not allocated by disease and age-sex

Administration not included

Overall of the $51.1 billion of personal health services & goods expenditure, 94% or $48 billion is able to be allocated by disease and age-sex. Includes hospital services, medical services, pharmaceuticals, aged care homes, dental and other health professional services

16


Millions of dollars by SHA categories by age group

Millions of dollars by SHA categories by age group

0-4 5-14 15-24 25-34

Male

Personal health care services 1,027 1,290 1,440 1,411

In-patient and day care services 502 249 438 547

Out-patient services 506 988 909 743

Home care . . . . . . . .

Ancillary services to health care 19 53 94 122

Medical goods dispensed to out-patients 154 188 229 306

Pharmaceuticals and other med. non-durables 154 188 229 306

Therapeutic appliances and other med. durables

. . . . . . . .

17


Total cost of disease by health sector for National Health Priority Areas, Australia,

2000-01, ($millions)

Total cost of disease by health sector for National Health Priority Areas, Australia,

2000-01, ($millions)

Cardiovascular

Musculoskeletal

Injuries

Asthma(d)

Mental disorders

Neoplasms

Diabetes mellitus

$0 $1,000 $2,000 $3,000 $4,000 $5,000 $6,000

Hospital and aged-care homes(b)

Medical and other health professionals(c)

Pharmaceuticals

Research

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Health expenditure per person by age and sex, Australia, 2000-01

Health expenditure per person by age and sex, Australia, 2000-01

0–4 5–14 15–24 25–34 35–44 45–54 55–64 65–74 75–84 85+

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$18,000$

per

cap

ita

Male

Female

Female (not maternal)

19


Health expend per person by age & area of expenditure, 2000-01

Health expend per person by age & area of expenditure, 2000-01

0–4 5–14 15–24 25–34 35–44 45–54 55–64 65–74 75–84 85+

$0

$2,000

$4,000

$6,000

$8,000

$10,000

$12,000

$14,000

$16,000

$ p

er p

erso

n

Total hospital

Aged care homes

Out-of-hospital medical

Total pharmaceuticals

Total expenditure

20


Utilisation dataUtilisation data

As well as dollars by disease we also have utilisation by disease. So for admitted patient hospital services we have number of DRG weighted discharges from hospital. For medical services we have number of services. For pharmaceuticals we have number of scripts.

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Uses of disease costing dataUses of disease costing data

Gives details of changes in expenditure, which leads to understanding of drivers of expenditure.

Drivers are different for different age groups

22


Change in real per capita pharmaceutical expenditure, 1993-94 to 2000-01, All persons


-$100.00

$0.00

$100.00

$200.00

$300.00

$400.00

$500.00

Person 5–14 15–24 25–34 35–44 45–54 55–64 65–74 75+ Allpeople

Other

Other contact

Injuries

Nervous

Digestive

Respiratory

Genitourinary

Infectious

Diabetes

Endocrine

Cardiovascular

Neoplasms

Mental

Musculoskeletal

-$12m-12%

$650m74%

$560m76%

$490m58%

$465m74%$235m

53%$120m37%

$35m17%

$2,500m61%

23



Age-sex-disease data, and understanding drivers of expenditure very useful for projections, as can make estimates based on expected disease declines

24


Decomposition of change in expenditure 2001 to 2031 for CVD treatment

Decomposition of change in expenditure 2001 to 2031 for CVD treatment

00

00

00

2006 2011 2016 2021 2026 2031-$3,000

-$2,000

-$1,000

$0

$1,000

$2,000

$3,000

$4,000

$5,000

$ million

Ageing

Population

Disease rate

Volume per case

Price

0Change in total expenditure

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Disease costing data is best way to solve issue of link between inputs, outputs and outcomes

26


Linking inputs, outputs and outcomesLinking inputs, outputs and outcomes

INPUT (dollars)

OUTPUT (hospital separation, medical service, pharmaceutical script)

OUTCOME - Attributable change in health status (DALYs)

27



I will illustrate the link between inputs, outputs and outcomes with cardiovascular (circulatory) disease

28


Age-standardised death rates for major causes of death, 1922–2000Age-standardised death rates for major causes of death, 1922–2000

Female

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

1922 1934 1946 1958 1970 1982 1994

Dea

ths

per

100

,000

Infectious and parasitic diseasesOther diseasesRespiratory diseaseInjury and Poisoning

Circulatory diseaseCancer

Male

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2,000

1922 1934 1946 1958 1970 1982 1994

Dea

ths

per

100

,000

Infectious and parasitic diseasesOther diseasesRespiratory diseaseInjuries and poisoningCirculatory diseaseCancer

29


Life expectancy OECD countries 1970 to 2003Life expectancy OECD countries 1970 to 2003

Australia

United Kingdom

United States

Denmark

64

66

68

70

72

74

76

78

80

82

84

1973 1977 1981 1985 1989 1993 1997 2001

Year

LE

JapanSwedenCanadaAustraliaFranceNorwayUnited KingdomUnited StatesDenmarkSwitzerlandIceland

30


Life expectancy OECD countries 1970 to 2003Life expectancy OECD countries 1970 to 2003

6 4

6 6

6 8

7 0

7 2

7 4

7 6

7 8

8 0

8 2

8 4

1 9 7 3 1 9 7 7 1 9 8 1 1 9 8 5 1 9 8 9 1 9 9 3 1 9 9 7 2 0 0 1

Y e a r

LE

J a p a n

S w e d e n

A u s t r a l ia

F r a n c e

S w i t z e r la n d

I c e la n d

31


Reasons for decline in coronary heart disease in AustraliaReasons for decline in coronary heart disease in Australia

Reduction in smokingReduction in high blood pressure due both to lifestyle changes and drug treatmentBetter treatment - better care by GPs and specialists, better ambulance services, coronary bypass, stents etcPossibly better blood lipids due to better diet and hyperlipidemic agentsOther factors

32


Reasons for decline in coronary heart disease in AustraliaReasons for decline in coronary heart disease in Australia

Most of the expenditures driving this decline are included in the disease expenditure data baseTherefore the decline can be attributed to these expendituresThere is debate about which part of health sector responsible for which parts of decline

33




-$100.00

$0.00

$100.00

$200.00

$300.00

$400.00

$500.00


Other

Other contact

Injuries

Nervous

Digestive

Respiratory

Genitourinary

Infectious

Diabetes

Endocrine

Cardiovascular

Neoplasms

Mental

Musculoskeletal

-$12m-12%

$650m74%

$560m76%

$490m58%

$465m74%$235m

53%$120m37%

$35m17%

$2,500m61%

34


Cardiovascular pharmaceutical expenditure in 2000-01

Cardiovascular pharmaceutical expenditure in 2000-01

996,711,030

866,641,426

Antihypertension agents

Lipid lowering drugs

Prevention $864m 87% $696m 80%

Treatment/ prevention for those with disease

$132m 13% $170m 19%

35


RecommendationRecommendation

Disease expenditures should be split into treatment, preventive and maintenance/ long term care components wherever possible

36


Change in per capita admitted patient expenditure, 1993-94 to 2000-01, All persons

Change in per capita admitted patient expenditure, 1993-94 to 2000-01, All persons

-$200.00

$0.00

$200.00

$400.00

$600.00

$800.00

$1,000.00

$1,200.00


Other

Other contact

Injuries

Nervous

Digestive

Respiratory

Genitourinary

Infectious

Diabetes

Endocrine

Cardiovascular

Neoplasms

Mental

Musculoskeletal

37


Real per person increase in admitted patient expenditure for cardiovascular disease, 1994 to 2001Real per person increase in admitted patient expenditure for cardiovascular disease, 1994 to 2001

45-54 0%

55-64 -2%

65-74 7%

75+ 25%

Total 22%

38


Input outcome linkageInput outcome linkage

We can look at the increase in real expenditure for cardiovascular disease from 1993-94 to 2000-01 and compare it to change in Disability adjusted life years (DALYs) lost due to cardiovascular disease from 1996 to 2003

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This is a very good efficiency measure.The calculations have not yet been done as 2003 burden of disease estimates have not been completed, but it is clear from the reduction in cardiovascular deaths that the extra cardiovascular expenditure (35% increase) from 1994 to 2003 has returned many DALY benefits

40



We can do these calculations for other areas as well. Eg for cancer. For 1993-94 we calculated that the average cost of treatment for lung cancer was $26,000 per DALY averted. For breast cancer the average cost was $3,000 per DALY averted.

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For an area like dementia there have been no DALY gains in the period 1994 to 2001, so we can’t use change in DALYs compared to change in dollars as efficiency measure.But we can measure change in real costs of care per person with dementia

42


Other uses of linking disease expenditure data to outcomesOther uses of linking disease expenditure data to outcomes

‘What if’ questions can be answered?What if smoking rates are reduced by 5 percentage points?What will be consequences over time on Disease incidence DALYs Hospital, medical & pharm utilisation Health system costs Commonwealth funding

43


Future work in disease expenditureFuture work in disease expenditure

Estimating disease expenditure for 2003-04 financial year

Linkage to epidemiological data in the forthcoming 2003 burden of disease data base

44


Future work in disease expenditureFuture work in disease expenditure

Source of funds (Australian Government/State government/private) estimates will be made

45


Publications are downloadable from webPublications are downloadable from web

http://www.aihw.gov.au/bod/expenditure/index.cfm

46


FinisFinis

Thank you

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