The Australian Health Care System, CHERE Discussion Paper No 38

Australia is a federation of states, which provides its residents with universal access to health care and has managed to control total health care expenditure to around 8.4% of GDP in 1996/97. This has not only been achieved through a strong centrally funded health care system, but Australia also has a substantial private health care sector, being second only to the United States in the OECD in terms of private financing of health care. Against a background of complex Federal and State government relationships and responsibilities, the Australian health care system has developed into a multi-faceted system, characterised by a complex interaction between governments on the one hand, and public and private purchase and delivery of health care services on the other. The question remains as to the capacity of such a mixed system to achieve some level of technical and allocative efficiency, whilst maintaining universality and equity of access. This paper focuses on exploring these tensions in the context of the relationship between the various levels of government, the public and private systems, and the tenuous balance that exists in striving to achieve the broader objectives of efficiency and equity.