The report examines the way selected health services were delivered across Australia for the financial years 2001–02, 2004–05 and 2006–07. This analysis was performed using the Australian Standard Geographical Classification system to compare the expenditure and usage rates of the health services by residents of Major cities, Inner regional, Outer regional, Remote and Very remote areas of Australia.

For the majority of health services examined in this report, there is a clear difference in the pattern of engagement by residents of the different regional areas with the health system.

For hospital services there is a strong increase in the number of public hospital separations and expenditure with the remoteness of the patient’s residence, especially in relation to overnight and acute hospital separations. Australians living in the most remote areas of the nation accounted for over twice the per person expenditure levels on these services compared with Australians living in Major cities.

For almost all Medicare services, such as for general practitioners and specialists, the opposite trend is present—with service usage levels being highest for residents in the more urban areas and lowest for those in regional and remote areas.

The lower expenditure levels were especially pronounced for other Allied health professional services, with Inner regional residents receiving 70% of the per person expenditure for residents of Major cities, while the per person expenditure levels for the most remote Australians was only 8% of that for city residents.

The analysis in the report covers 56% of all recurrent health spending within Australia, focusing on health expenditure where categorisation by remoteness was available or considered of good enough quality.