Health prices
It can be useful to understand how much changes in health spending are related to price changes (e.g. inflation) rather than the volume or nature of services being purchased and how this compares with the general economy. Between 2019–20 to 2020–21, health prices grew by 1.96% on average. This is broadly consistent with yearly health inflation over the past decade, which has fluctuated between 1.6% and 2.2%. General inflation, measures using the implicit price deflator (IPD) for gross national expenditure (GNE), was 0.8%. As such, ‘excess health inflation’ was 1.16%, indicating that prices of health goods and services rose slightly faster than prices in the general economy (Figure 5).
Over the decade to 2020–21, prices in the health sector were relatively stable compared with prices in the broader economy. This resulted in varying levels of excess health inflation, ranging from –0.3% in 2013–14 to 1.27% in 2016–17.