There has been a lot of discussion on what is spent on health, but perhaps less on what Tasmania's poor health outcomes are costing us as a state.
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Looking through a preventative health lens, governments needs to spend more in order to reduce the burden poor health outcomes have on the economy.
This, according to Deloitte Access Economics partner Paul Liggins, who provided an update on Tasmania's economy as part of a budget luncheon hosted by the Launceston Chamber of Commerce.
As part of The Examiner's State of Health series, reporter JESSICA WILLARD caught up with Mr Liggins to talk Tasmania's economy and the cost of poor health.
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What's holding us back?
According to Mr Liggins, there are three key areas holding Tasmania's economy back and they are all interrelated - to some extent.
One is education, the second is Tasmania's population structure, and the third is health.
Tasmanians remain older, poorer, less healthy, less educated and more likely to be affected by disability than other Australians.
Aside from affecting a person's ability to live a fulfilling life, unhealthy people restrict economic growth when they are unable to work, learn, innovate and contribute to community.
Tasmania's poor health outcomes remain linked to economic and social disadvantage, which is often measured by a person's income, occupation and education level.
Someone who does not complete year 12 is significantly more likely to be unemployed than someone who did. They are also more likely to have health problems.
Mr Liggins said for Tasmania, the pattern was systemic.
"It is a real issue for Tasmanians and it's a long term issue. It's also not something that just happened in the last few years," he said.
"Health is very much related to whether people have a job or not.
"Whether you have a job or not it very much related to what sort of education you have. So the link between education and health in all literature is very strong."
The average Tasmanian age is now 50 per cent older than it was in 1984, an increase of 28 to 42 years, with one in five Tasmanians aged over 65.
While contributing to poor health outcomes, Mr Liggins said an ageing population didn't explain all the differences between Tasmania's health indicators and the rest of the country.
"We know Tasmania is about 15 point below the rest of the country in terms of year 12 completions throughout the overall economy," he said.
"That's picked up in the last few years, but it's only very recently that it's done so.
"So we are left with a laden population that is less educated than the rest of the country on average, and that obviously affects our health."
The benefit verse cost of preventative health spending
The state government claims to spend about $70 million on preventative health measures, or about 1.5 per cent of the total health spend. Over forward estimates this decreases to about 1.15 per cent.
However, Mr Liggins said the cost-benefit analysis for proven preventative health actions were substantial.
Like the saying "you need to spend money to make money", he said the government would need to invest more in preventative health if it wanted to achieve results.
"When we look at an infrastructure project or typical government policy, often they will have a benefit-cost ratio of somewhere between one and two - the benefits are slightly higher or double the costs," he explained.
"But a lot of literature shows that for many preventive health actions, the benefit cost ratios can be substantial - five, 10 even 20-times the cost.
"It's pretty clear that not only Tasmania, but other states as well, are not spending enough on preventative health.
"As a result, that creates a longer-term health burden that could potentially be avoided."
Advocates argue the proportion of government spending on preventative health measures should be a minimum of 5 per cent of the government's total health spend.
Health Minister Michael Ferguson has said redirecting $405 million would result in cuts to acute services and massive hospital bed closures.
However, Mr Liggins said without long-term thinking around investment Tasmania's health burden would continue to get heavier.
"You can definitely understand the state government putting money into more acute health issues when there are ambulances ramped-up, shortages with hospital beds and public outcry," he said.
"Of course you have to treat people at the time they are sick.
"But I think it's well recognised that there's a range of interventions that are currently being underfunded both nationally and particularly here in Tasmania, that would have lasting long-term benefits, but the spending is not there.
"They are tough decisions for a government to make, but a courageous and long-term thinking government would do that sort of thing."
Is ill-health hampering the economy?
Healthcare and social assistance remain Tasmania's biggest industry.
Over the next five years, the sector is expected to add more jobs than all other industries put together.
Mr Liggins said this was definitely an area Tasmania could capitalise on to further support the economy.
"Particularly around healthcare and social assistance for people that are out of the work force, or affected by disease or mental health problems who should be in the workforce," he said.
"That is definitely hampering our economy.
"We have a lower participation rate in terms of people being involved in the workforce than any other state.
"I think a big part of that is due to poor health and it will probably get a lot worse before it gets any better."