Impact of emerging new treatments and technologies on health care eg. Cost and access, benefits of early detection

Impact of Advances in Medical Technology on Healthcare Expenditure Life expectancy in Australia has grown over the last decade. Expenditure on health has risen as a percentage of GDP. 66% of the increased cost can be attributed to emerging technologies. Technology appears to be reducing unit costs and increasing the range and quality of services that are delivered. Other OECD nations have experienced similar patterns of growth with a correlation between growth in per capita GDP and health expenditure per capita. This is fuelled by increased demand and a growing number of services which can be provided. Demand is strong and Australians are choosing to expend more on health services. With the strong economic growth of the last ten years, a well-educated public is demanding rapid access to emerging technologies. The safety, cost effectiveness and efficacy of these are assured by a range of national regulators. In addition, the Australian Government actively influences the price of many new technologies to ensure that the public receive value for money. The majority of health related research and development in Australia is funded by the Australian Government. The National Health and Medical Research Council has a lead role in setting research priorities. Investment is directed towards national health priority areas and general clinical research as well as encouraging the best Australian talent to work in Australia. Technology already introduced has improved the range of preventative measures available, made possible earlier and more accurate diagnosis, moved many treatments formerly performed in hospitals out into the community, brought the unit cost down and enabled health treatments which were not previously available. This has come at a cost but without it Australians would require more time in hospital and have poorer health.

Information and Communications Technology (ICT) has potential to further improve the quality of health services and reduce the administrative load. Impact of Advances in Medical Technology on Healthcare Expenditure Advances in technology have reduced the unit cost of delivering particular health services but increased the range and quality of services that can be delivered. Growth in demand for services, which is partially driven by availability of new and better technologies, has historically outstripped unit cost savings brought about by new technologies. This is expected to continue. The continuing demand for new and better health services will challenge our regulatory regimes, national finances and our health workforce but, if historical trends continue, will also result in better health outcomes for all Australians. For the purpose of this submission we are using the Productivity Commission’s definition of technology which encompasses physical equipment, instruments and pharmaceuticals, clinical procedures, knowledge an d support systems. Within these terms advances in medical technology have been the strongest drivers of growth in healthcare expenditure over the last decade.

(Source: Department of Health and Ageing submission to the Productivity Commission)

Challenges in health and health care for Australia The costs of new technology Much of the rise in health care costs can be attributed to advances in medical technology. Diagnostic and therapeutic advances, such as new radiological scanners, biological therapeutics, minimally invasive surgical procedures and prostheses, frequently come at a considerable cost. Listing these for subsidy through Medicare or the Pharmaceutical Benefits Scheme (PBS) greatly increases their availability and use, and therefore the cost to the community. Failing to subsidise them inevitably raises questions about why new medical advances are not available to all Australians, and generates political pressure. Australia has an enviable record in the assessment of new pharmaceutical products, based on the principles of cost-effectiveness. Criteria are used in public and private hospitals to determine access to new technology.

(Source: Medical Journal of Australia)

3-2-1 Reflect:

After investigating the impact of emerging new treatments on health care

3 recalls –state 3 facts they can recall from these sources

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2 so what’s –write 2 things about HOW health care technology has influenced early detection, cost and/or access

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1 question – students answer 1 practice HSC question on this syllabus content.

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