Medical money; why do we ignore the economics of health and welfare?

Today, we again face the horrifying prospect that we have all grown to fear; a super-sad Scott Morrison.

He’s just so grumpy in the mornings!

Yesterday Australia’s newest treasurer gave his Bloomberg address, dividing the population into the “taxed and taxed-nots”. Mirroring his predecessor’s rhetoric, Mr. Morrison described a welfare system that allows people to mooch off a decreasingly small number of taxpayers whilst rarely undertaking any work of their own. Throughout the speech there were allusions to the common thread of lazy youth, and the very strong implication was that the new generation needs to pull their socks up and get to work.

You’d be hard-pressed to come across a bigger pile of crap if you walked in a field full of cows.

Pictured; ScoMo’s speechwriters

The biggest element of ScoMo’s speech, that welfare is too generous and young people too greedy, is actually contrary to the data. That is to say, wrong. AIHW figures demonstrate that the spend on unemployment and youth benefits has stayed relatively stable over the last decade. If you have a look, you might notice that the overall welfare spend has increased. In fact, it’s increased quite a bit.

Aside from the obvious outlier of the 2008–9 financial year, there’s a clear trend towards higher welfare costs. It’s also quite easy to see that the increase is almost entirely due to a single group; Older People. This is something that has long been prophesied; as we live longer lives, a greater proportion of the population gets the pension. The more pensioners, the higher the spend on welfare for older people.

It’s a fairly well-understood phenomenon, and in public health almost any initiative that is proposed has to take into account the fact that in 20 years the average age in the population will likely be higher than it is now.

Graphs of old people; scaring public health professionals since the turn of the century

Despite the clear-cut increase in costs to the Australian economy of having a population that is aging, there was barely a mention of how we are going to face this challenge in ScoMo’s speech. It’s important to remember that the costs to the welfare system are just the tip of the iceberg; almost all of our social support costs will increase as we all get older. And yet, there are vanishingly few suggestions from either major party on how to control these costs, perhaps because whilst old people tend to vote (and mean it), young people are underrepresented in the electoral system. However, ignoring the fact that health and welfare costs are only going to increase is just palming off the problem to the government of 10 year’s time.

Platitudes about ‘innovation’ just don’t cut it.

ScoMo is also ignoring the behemoth that is Medicare. I’ve written before about how Medicare urgently requires an overhaul to it’s very structure; the small cuts that the Coalition is currently focusing on are both politically unfeasible and likely to result in increased costs.

With healthcare costs only set to rise, it’s disappointing that young people get all the blame. As a young person who’s paid tax for more than a decade now, I find it insulting when someone describes my generation as lazy, particularly when it goes against evidence that we are not.

Apparently we are a generation of Cats

There’s another big elephant in the room when it comes to health and welfare; the costs of climate change. It’s well-established that climate change comes with a unique set of health costs that are likely to explode in the coming years, and yet you will find nary a mention of the economic impact of climate change in ScoMo’s speech. Instead, he takes a number of swipes at China, whilst implying that refugees are an economic burden despite the mixed long-term evidence on the costs of refugees.

Climate change is here, it is impacting us as we speak, it is time to include it in every conversation about health and welfare.

True innovation looks to the future challenges, rather than stagnating in politicized drudgery.

There are many other elephants in the room (it’s a very big room) that all seem to have fallen under the radar. Obesity is a growing health and economic burden, with the cost of obesity set to rise exponentially in the coming years. With it’s impact on welfare and disability costs, obesity is becoming a problem that simply can’t be ignored. It has been estimated that every dollar invested in preventing obesity will see a return of $1.70 , and yet current government policy barely touches on this untapped well of savings. Despite ScoMo’s rhetoric around a revenue problem, he steers well clear of suggesting a sugar tax even though it would both improve health and raise money for the government.

There are so many places we could save money (and lives), it’s a shame that our government is instead choosing to ignore most best evidence and focus on savings that may in fact turn out to cost us more. Rather than empty rhetoric about innovation, we need real solutions to the economic problems caused by climate change, the aging population, obesity and a myriad of other problems that we’ve known about for years. We did it with smoking; our healthcare costs are among the lowest in the world for smoking-related disease, and the government still draws in significant revenue from taxation of tobacco products.

We ignore real health and welfare policy because it is difficult; no one really knows what to do to reform the system in the face of these challenges. We are scared that any major changes will be not just politically unfeasible but incredibly damaging to our future economy. But our fear causes inaction, and we are leaving problems in the ‘too-hard’ basket instead of actually taking steps to fix them.

And that’s truly scary.