Indigenous health spending up, but relativities have changed little

Estimated expenditure on health services for Aboriginal and Torres Strait Islander people rose between 1998-99 and 2001-02, from $1.4 billion to $1.8 billion, according to a report released today by the Australian Institute of Health and Welfare (AIHW).

The share of national health spending going to Indigenous people increased from 2.5% to 2.8%.

Expenditures on health for Aboriginal and Torres Strait Islander peoples, 2001-02 shows that per person health spending on Indigenous people in 2001-02 was $3,901 compared with $3,308 for non-Indigenous people, a ratio of 1.18 to 1.

Head of the AIHW's Health and Welfare Expenditure Unit, Tony Hynes, said that given the uncertainties and complexities surrounding these measurements, 'it's fair to say that the relative position of the two populations, in terms of health expenditure, had changed little since 1998-99, when the ratio was 1.22 to 1'.

'There are considerable differences in the mix and relative costs of health goods and services used by Indigenous Australians compared with non-Indigenous Australians.

'The overall spending ratio therefore does not necessarily indicate that Indigenous people use more health services. In fact many services to Indigenous people are more costly to deliver, both because of geography, and because many health services have to be provided in different ways to the mainstream so that Indigenous people will use them', Mr Hynes said.

'A greater proportion of the Indigenous population lives in remote and very remote regions (26% compared with 2%). The costs involved in just getting services to such areas are much higher than for more settled regions.'

'But even in urban areas, many Indigenous people are reluctant to use mainstream services. Our report shows that Indigenous Australians are relatively low users of Medicare and the Pharmaceutical Benefits Scheme, at 39% and 33% respectively of the non-Indigenous average use. This, too, has not changed much since 1998-99, and is offset to some extent by increased access to specific programs such as Aboriginal Community-Controlled Health Services, and other community health services targeted to Indigenous people.'

'It seems that much of health expenditure growth overall between 1998-99 and 2001-02 was in goods and services which Indigenous people use less of and non-Indigenous people use more of-such as private hospital services, pharmaceuticals, and dental and other professional health services.'

'This is probably because only 15-20% of Indigenous Australians have private health insurance, which commonly pays for a large proportion of these services' Mr Hynes said.

Mr Hynes said that any analysis of per-person spending on health services for Indigenous people should bear in mind the comparatively poor health of Indigenous people.

Indigenous mortality rates are three times that of the general community and Indigenous people die on average 18 years younger than the average for all Australians.

20 July 2005

Further information: Mr Tony Hynes, AIHW, 02 6244 1160, or tel. 0407 915 851

For media copies of the report: Publications Officer, AIHW, tel. 02 6244 1032.