Health system expenditure

How much is spent on diabetes?

In 2018–19, an estimated $3.0 billion of expenditure in the Australian health system was attributed to diabetes, representing 2.3% of total disease expenditure (AIHW 2021).

Of the $3.0 billion health system expenditure attributed to diabetes in 2018–19, an estimated:

  • $321.0 million was attributed to type 1 diabetes
  • $1.9 billion was attributed to type 2 diabetes
  • $62.3 million was attributed to gestational diabetes
  • $808.1 million was attributed to ‘other/unknown’ diabetes (AIHW 2021).

Note: Due to the high number of ‘other/unknown’ diabetes caution should be used when interpreting data by diabetes type.

What is health system expenditure on diabetes?

This section provides recent data on health system expenditure on diabetes, with details by type of condition, health-care service, age group, and sex. It includes expenditure by the Australian Government, state, territory and local governments and the non-government sector (including private health insurance and individual contributions). These estimates report direct, allocated and recurrent expenditure only. They do not account for the total amount spent on diabetes health. 

Further information on how the estimates were derived is available from the Disease expenditure in Australia web report.

Where is the money spent?

In 2018–19, 39% ($1.2 billion) of total health system expenditure attributed to diabetes was for hospital services. This included expenditure on public hospital admitted patients ($604.8 million), public hospital outpatients ($470.4 million), private hospital services ($85.3 million), and public hospital emergency departments ($19.8 million). Medications dispensed through the Pharmaceutical Benefits Scheme (PBS) was the single highest area of spending with just over a quarter of total diabetes expenditure ($776.8 million) (Figure 1).

Figure 1: Health care expenditure on diabetes, by diabetes type and area of expenditure, 2018–19

The chart shows health care expenditure on diabetes by type and area of expenditure in 2018–19. For all diabetes, type 1 and type 2 diabetes medications dispensed through the Pharmaceutical Benefits Scheme was the highest area of expenditure followed by public hospital admitted patients. For other diabetes, the highest area of health care expenditure were public hospital outpatients followed by medications dispensed through the pharmaceutical benefits scheme.   

Who is the money spent on?   

The health system expenditure attributed to total diabetes varies significantly according to age and sex. In 2018–19:

  • total disease expenditure was 1.3 times as high in males compared with females ($1.4 billion and $1.1 billion, respectively)
  • total diabetes expenditure generally increased with increasing age with 61% being spent on people aged 55 and over and peaking in the 65–69 and 70–74 age groups (both $351.0 million) (Figure 2).   

Figure 2: Health care expenditure on diabetes (all areas), by diabetes type, age and sex, 2018–19

The chart shows the overall health care expenditure on diabetes by 5-year age group and sex in 2018–19 by diabetes type. Expenditure increased with increasing age for all diabetes types except for type 1 diabetes, where expenditure was highest among the younger age groups between 10 and 34 years, increasing again among those aged 50 and over.  

Type 1 diabetes

Where is the money spent?

In 2018–19, 47% of allocated type 1 diabetes expenditure ($152 million) was spent on hospital services. This included expenditure on public hospital admitted patients ($87.1 million), private hospital services ($9.5 million), public hospital outpatients ($50.6 million) and public hospital emergency departments ($4.7million).

Another 30% of expenditure ($94.7 million) related to medications dispensed through the PBS and 12% to dental services ($37.1 million).

The remaining 12% ($37.3 million) of expenditure was related to non-hospital medical services (primary care), comprising general practitioner (GP) services ($16.9 million), specialist services ($8.6 million), medical imaging ($1.1 million), pathology ($8.2 million) and allied health and other services ($2.4 million) (Figure 1).

Who is the money spent on?

The economic burden attributed to type 1 diabetes varies significantly according to age, sex and area of expenditure. In 2018–19:

  • total disease expenditure was higher for males than females ($150.8 million and $132.2 million, respectively)
  • expenditure on medical imaging, PBS items and public hospital outpatients was 1.3 times higher for males than females while expenditure on private hospital services and specialist services was 1.2 times higher for males than females with type 1 diabetes
  • expenditure for females with type 1 diabetes was highest in those aged 30–34 ($11.6 million). Notably, this expenditure is 1.5 times higher than males aged 30–34 ($7.8 million). Expenditure for males with type 1 diabetes was highest in those aged 60–64 ($13.8 million) (Figure 2).

Type 2 diabetes

Where is the money spent?

In 2018–19, 44% ($823.9 million) of type 2 diabetes expenditure was spent on medications dispensed through the PBS ($507.1 million) and dental programs and services ($316.7 million).

Another 40% ($755.1 million) of allocated type 2 diabetes expenditure was spent on hospital services. This included expenditure on public hospital admitted patients ($467.3 million), private hospital services ($74.2 million), public hospital outpatients ($210.9 million) and public hospital emergency departments ($2.6 million).

The remaining 16% ($279.4 million) of expenditure was attributed to GP services ($131.8 million), specialist services ($35.0 million), medical imaging ($2.0 million), pathology ($86.4 million) and allied health and other services ($24.1 million) (Figure 1).

Who is the money spent on?   

The health system expenditure attributed to type 2 diabetes varies significantly according to age, sex and area of expenditure. In 2018–19:

  • total disease expenditure was higher in males than females ($904.8 million and $633.9 million, for males and females, respectively).  This trend coincides with expenditure being highest in younger females and older males.
  • total disease expenditure for persons with type 2 diabetes generally increased with increasing age, peaking in the 70–74 age group ($236.8 million) (Figure 2).

Gestational diabetes

Where is the money spent?

In 2018–19, 84% ($52.2 million) of the health system expenditure for gestational diabetes was attributed to hospital services including $35 million of which was spent on public hospital admitted patients, $16.2 million on public hospital outpatients, $893,000 on private hospital services and $11,500 on public hospital emergency department presentations.

The remaining 16% ($10.1million) of expenditure was related to allied health and other services ($616,800), general practitioner services ($1.5 million), medical imaging ($20,500), pathology ($1.0 million), PBS ($23,200) and specialist services ($6.9 million) (Figure 1).

Who is the money spent on?

The health system expenditure attributed to gestational diabetes increases with age, peaking in females aged 30–34, before declining in older age groups. In 2018–19:

  • 42% of public hospital emergency department expenditure for gestational diabetes was attributed to women aged 25–29 ($4,800)
  • expenditure attributed to specialist services was 1.3 times higher in women aged 35–39, compared with those aged 30–34 ($2.6 million and $2.0 million, respectively) (AIHW 2021).

Further detail by demographics and area of expenditure is available in the Disease expenditure in Australia 2018–19: data tables.

Aboriginal and Torres Strait Islander People

In 2015–16, expenditure on potentially preventable hospitalisations (PPH) was 2.2 times higher in Indigenous Australians compared with non-Indigenous Australians ($392 and $176, respectively). Notably, the greatest difference in expenditure is attributed to diabetes, a gap of $33 per person (AIHW and NIAA 2020).

References

AIHW (Australian Institute of Health and Welfare) (2021) Disease expenditure in Australia 2018-19, AIHW, Australian Government, accessed 24 March 2022.

AIHW and NIAA (National Indigenous Australians Agency) (2020) 3.21 Expenditure on Aboriginal and Torres Strait Islander health compared to need - AIHW Indigenous HPF,  AIHW and NIAA, Australian Government, accessed 24 March 2022.