Summary
In 2022–23, health spending has returned to the pre-pandemic trend. An estimated $252.5 billion was spent on health goods and services in Australia, which equates to $9,597 per person and comprised 9.9% of overall economic activity.
After adjusting for inflation, total health spending (recurrent and capital) was 0.3% less than in 2021–22.
Per person health expenditure in 2022–23 decreased by 2.4% in real terms, well below the average growth rate over the decade up to 2022–23 of 1.9%. This can be attributed to health spending and population growth returning to pre-pandemic levels.
Governments funded around 70.8% of health spending – $101.5 billion by the Australian Government and $77.3 billion by state and territory governments in 2022–23.
Unlike the previous year, when health spending by government increased and non-government sources decreased in response to the COVID-19 pandemic, in 2022–23 government spending decreased by 2.6% while non-government spending increased by 5.8% in real terms. However, the actual non-government health spending was still below the 10-year historical trend before the pandemic (2008–09 to 2018–19).
Government health spending as a percentage of total government expenses decreased by about 0.1 percentage points (from 17.2% in 2021–22 to 17.1% in 2022–23). This indicates that growth in government health spending was slower than other areas of government expenses.
During 2022–23, the main changes in recurrent spending in real terms were:
- primary health care was $83.3 billion, a $7.5 billion (8.2%) decrease in real terms, which was associated with decreased spending related to the pandemic, such as COVID-19 vaccines, and personal protective equipment.
- hospitals was $107.1 billion, a $4.8 billion (4.7%) increase in real terms. This growth in hospital spending was mainly driven by an increase in hospitalisations for admitted patients.