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Expenditure on goods and services

Examining expenditure on health goods and services is one way of understanding the ways in which health resources are delivered and utilised. Expenditures reflect needs on which resources have been spent, rather than met needs or overall needs, but they can cast some light on the differing ways in which the health needs of Indigenous and other Australians are met (through, say, a different mix of primary care and other health services). Expenditures can also provide some broad insights into the utilisation of health services. But any such interpretation must be undertaken with care, because the amount of expenditure incurred for a given level of utilisation can also be affected by factors such as the demographic composition of the population and its geographic distribution. Thus information about expenditure must be considered alongside the information about the numbers and types of services that are presented in this and other chapters.

In 2001-02 estimated expenditure on health goods and services for Aboriginal and Torres Strait Islander people was $1,788.6 million (table 10.1) or 2.8% of total health expenditure. Almost three-quarters of this (72%) related to two major program areas - services provided in hospitals ($849.5 million) and community health services ($439.9 million). The expenditure on community health services included $186.3 million on Aboriginal Community Controlled Health Services that were funded by the Australian Government.

On a per person basis, average expenditure on health goods and services for Aboriginal and Torres Strait Islander people was $3,901, which was 18% higher than the expenditure for non-Indigenous Australians ($3,308). There has been little change in this relative position since the previous estimates for 1998-99.

6.1 Expenditure on health goods and services, by area of expenditure, current prices, Australia - 2001-02
		Total expenditure($M)		Average per person expenditure($)
Health goods and services type		Indigenous	Non-Indigenous	Indigenous	Non-Indigenous	Ratio(a)
Hospitals		849.5	21 456.9	1 853	1 132	1.6
	Total admitted patient services	682.5	17 927.4	1 488	946	1.6
	Non-admitted patient services	142.4	3 116.5	311	164	1.9
	Public hospitals	24.7	413.0	54	22	2.5
Medical services		99.6	11 112.5	217	586	0.4
Dental services(b)		21.8	3 734.2	48	197	0.2
Pharmaceuticals		66.2	9 011.6	144	475	0.3
Public health		72.5	1 029.9	158	54	2.9
Community health services(c)		439.9	2 810.5	959	148	6.5
High-level residential aged care		49.9	4 591.6	109	242	0.5
Other health services(d)		189.2	8 961.7	413	473	0.9
Total		1 788.6	62 708.9	3 901	3 308	1.2
(a) Average per person expenditure on Indigenous Australians divided by the average per person expenditure on non-Indigenous Australians.
(b) Excludes state and territory government expenditure on dental services.
(c) Community health services includes state and territory government expenditure on dental services.
(d) Includes, health administration n.e.c., patient transport, aids and appliances, other professional services and other health services n.e.c.
AIHW 2005j

In four major program areas, average expenditure on services for Indigenous people was greater than that for non-Indigenous Australians. These were community health services, which had an Indigenous to non-Indigenous person ratio of 6:1, public health (which includes services such as alcohol and drug treatment services, cancer screening and environmental health) with a ratio of 3:1 and admitted and non-admitted patient services in acute-care hospitals, with a ratio of 2:1 (table 10.1).

In contrast, average expenditure on goods and services provided outside public hospitals was much lower for Indigenous people than for non-Indigenous people. For example, average expenditure on high level residential aged care, medical services, pharmaceuticals, and dental services were, on average, less than half that for non-Indigenous Australians.