Health Systems:

-Systemic problems across Australia, Canada, New Zealand, and UK –

Introduction

Even cursory comparisons between national health systems across the western world reveals a commonality of problems (https://healthsystemsglobal). This article looks at 4 similar  yet distinct, health systems in Australia, Canada, New Zealand, and the UK, to examine these problems and considers potential solutions. The four countries chosen are linked by common heritage and principal language but have organised their health systems under different models. Australia’s health system operates under a shared public-private model, with the Medicare system serving as the national single-payer funding model. The Canadian health care system is known as Canadian Medicare. It operates under a decentralized, universal, publicly funded model. New Zealand the UK operate under the Beveridge system. In this model, the government directly provides healthcare services. It is funded through taxation, and care is universally accessible. The UK’s National Health Service (NHS) exemplifies this model (Https://www.commonwealthfund.org/blog/2021).

All these systems attempt to provide universal care and offer a similar range of services. Currently they are all under-funded and require substantial Government subsidies to continue to operate. The impact of this cross subsidisation is shown in the rising percentage of the national budgets devoted to health issues, for example the percentage of GDP devoted .to public health increased between 2005 and 2020 by thirty-three. % (please check this number as after 33 has period  NZ and Australia are 33% , 79.1%, 33% and 68% for Australia, Canada, New Zealand, and the UK  respectively.

The Canadian experience between 1975 and 2023 (shown in figure 1) is indicative of the steep cost increases in health provision world-wide,

The data in Figure 1 show Canadian health costs as a percentage of GDP rising on average at approximately 11% per annum. This compares with an average CPI growth in Canada over the same period of 3.9%. In other words, health costs in Canada over this period rose 2.8 times faster than the general price level.

Figure 1 Total Health Costs in Canada as share of GDP 1975-2023

Shared Problems

The emergence of infectious diseases as exemplified by Covid 19 highlighted the existence of a host of deficiencies in these national systems, but these systemic problems had been growing consistently over time, well before the pandemic. On the demand side the main issues facing health systems are

1.Growth in and Aging of the Population

 In the case of Australia, older Australians constitute an increasing share of the population. For example, in 2013, 14% of the population (approximately 3.3 million people) were aged sixty-five and over, and 1.9% were aged eighty-five and over. By 2053, it is projected that 21% of the population will be aged sixty-five and over (around 8.3 million people) and 4.2% will be aged eighty-five and over (approximately 1.6 million people).

The cost implications of these trends are large. In 2018 the average health expenditure per person in Australia was $A 3250 this is projected to rise significantly: By2053 it is predicted to rise to approximately $A7400 per person¹.This age trend alone will push the percentage share of health care of GDP to rise form 19% in 2021-22 to 26% in 2060. By way of comparison Education (all sectors) took up 5.6% of GDP in 2020/21 and Defence 3.07% (What are the implications of population ageing for health and long-term care needs and costs? – Will Population Ageing Spell the End of the Welfare State? – NCBI Bookshelf (nih.gov)

Based on these projections the population aging/ cost elasticity coefficient is approximately 1,18, or for every 10% increase in the percentage of the population over sixty-five there is an 18% increase in average health costs per person.

2.Higher health expectations

 Population and aging are not the only things fuelling increased demand for health service. The community are more aware of health expectations and procedures and are demanding that more health services are provided (Changes in public perceptions and experiences of the Australian health‐care system: A decade of change – PMC (nih.gov) )

3.Growth in the range of medical procedures

 Improvements in medical techniques, including those robot and AI assisted medicine has greatly increased the range and effectiveness of medical procedures. (Influence of trends in hospital volume over time on patient outcomes for high-risk surgery | BMC Health Services Research | Full Text (biomedcentral.com) This in turn has significantly increased the number of treatable health complaints and the potential patient pool, in turn pushing up health costs. Combine this with an increasingly informed public and the effective demand for health services continues to grow

Supply side

1.Persistent underfunding and financial sustainability 

 Financing care for future generations remains a pressing concern across all four health systems. For example, despite being one of the highest spenders per person among democratic countries, Canada’s health care system faces financial constraints¹. Pouring more money into a broken system without addressing underlying issues is akin to “pouring hot water into a leaky bathtub” according to the Canadian Health Coalition.  (https://www.cbc.ca/news/canada/health-care-how-we-got-here-fix-broken-cracks-billions-canadian-duclos-1.6691196 (Canadian Health Coalition – We support public health care

2.Future Sustainability

Financing care for future generations remains a pressing concern. Continuing the Canadian example, escalating healthcare costs, an aging Canadian  population, and a declining worker-to-beneficiary ratio all contribute to the strain on Medicare.

3. Workforce issues

Attracting and retaining adequate staff is a persistent and problems. In Australia this includes a shortage of GPs. The Australian Health Minister describes  general practice as being in a “truly parlous state (Patients face long waits at public hospitals, exacerbating the strain on the system)  Nurses and auxiliary workers are in short supply in New Zealand, Canada and the UK (5 Reasons The NHS Is In Crisis Right Now | HuffPost UK Politics (huffingtonpost.co.uk)  Part of the staff shortages are driven by systemic pressures in the hospital system resulting in unsustainable workloads and low wages compared to other occupations (Journal+manager,+08_2004_Nursing_turnover_and%20(2).pdf)

4. Access inequality

This problem is across all four systems but is particularly felt in New Zealand. Inequities persist in gaining non-urgent access to New Zealand’s hospitals. Waiting lists for non-urgent surgeries have grown, with thousands of people waiting longer than four months for treatment. Access to specialist assessments also varies significantly by region, creating what’s often referred to as a “postcode lottery” for healthcare (NZ’s health system has been under Kiwis urged to look after themselves and alleviate pressure on health system this winter | Ministry of Health NZ pressure for decades. Reforms need to think big and long-term to be effective (theconversation.com) 

What is to be done 

• Making the population pay more for their health care

 The health systems of the four countries, like their pension and social security systems, were not designed for an aging population where average life expectancy is heading for the mid 80’s. When the universal pension was introduced in Australia, the average life expectancy was 55 years for men and 59 years for women (Defining Moments in Australian History: Age pension introduced – Australian Geographic.) At that time, the over 65 years population was less than16 percent of the population compared with 23% currently. In response, to the blow out in pension costs successive Governments introduced superannuation into the wage system as a means of financing. The same needs to be done with health care. More of the population need to pay more for their health care. In Australia, some medicare levy concessions are given for private health care membership but this must be expanded by making health fund membership and cost of private hospitals at least partially tax deductible. In done this will ese the pressure on public hospitals but raises serios questions on equity.

• Lifestyle improvements

One third of disability and death in Australia is attributable to preventable lifestyle-related risk factors. Those with chronic health concerns make up the bulk of the burden on the health system. Many of these conditions result from poor life -style choices such as smoking, over consumption and lack of exercise. (RACGP – Unhealthy lifestyles placing burden on our health system)   Across all of health jurisdictions: lifestyle-related risk factors not only affect individuals but also strain the health system, leading to costs related to managing chronic diseases such as diabetes, heart disease, and cancer.   (https://www1.racgp.org.au/newsgp/clinical/unhealthy-lifestyles-placing-burden-on-our-health) In a democratic country, people cannot be forced to adopt health lifestyles, but by promoting incentives such as lower medicare and health fund payments for those demonstrating good practice and restricting access to non-essential services for those with self-inflicted conditions would go a long way to easing the demand on the health services

• Educational services

To reduce unnecessary health issues Government educational services on healthy living should be increased both at work or school or in the home. Zimmerman and Wolf (2017) found targetter health education programs improved health outcomes significantly , especially if direct ed at school students (BPH-UnderstandingTheRelationship1.pdf (nam.edu)

• AI improvements 

 The increased use of AI can effectively reduce demand and increase the supply of medical service and lower overall costs, AI clinics can speed up diagnosis and reduce the need for multiple tests by doing all tests simultaneously. It is now possible for diagnosis to be done via AI at home or in community centres thereby reducing the infrastructure costs of hospitals. AI can speed up processing medical records and trace patient history far more effectively, thereby reducing costs. On the supply side AI assisted surgery can both speed up and reduce errors in the hospital system and ease staff loads

Conclusions 

Universal Health care systems are facing the same problems as pension schemes faced in the 1990s. They were not designed for a time when most people will live well into their eighty’s. All the health systems examined are under severe stress. Backloads are growing and slow  reception, triage, examination and treatment of patients and ambulance waiting times are at all-time highs. This is clear proof that health staff are stretched to breaking point   Advances in medicine over recent decades have meant people are living longer, which has put a squeeze on funding.( 5 Reasons The NHS Is In Crisis Right Now | HuffPost UK Politics (huffingtonpost.co.uk) 

These health services were already under pressure due to long-standing problems, but the Covid epidemic exposed the systemic flaws. In an inflationary world. Health costs were bound to rise but these costs have grown more rapidly than the general price level and in some ways were a causal factor in inflation. There flu, have all added to the sense of crisis this winter.   Policies suggest here will act to reduce health costs but at some point, in time society may need to reach a trade-off between lengthening life expectancy for all and easing the crippling debt that health system costs will come to exert on the economy.