The Problem and Specific Recommendations
Medical care cost constituted the highest US government expenditure in 2007($2.3 trillion), and medical care of seniors accounted for the big chunk of that amount. This total represented 16% of the US gross domestic product, compared to 10.9 per cent of GDP in Switzerland, 10.7 per cent in Germany, 9.7 percent in Canada, and according to the Organization for Economic Cooperation and Development (OECD), 9.5 per cent is in France. According to the daily USA Today, the US Federal government spent $952 billion in 2007 on elderly benefits, representing 35 per cent of the federal budget, while the states chipped in $27 billion more.
In Australia, the cost of health care is 17.7% of GDP, while the government’s percentage of health costs is 67.7% compared to 44% cent by the US government. This assumes that any increase in health care spending in Australia will lead to a greater corresponding increase in the proportion of health care costs borne by Australia the Australian Government (Elderly Care,(http://www.answers.com/topic/elderly-care,). Sweden, the UK and Japan provide a higher percentages (more than 80 per cent), while that of the United States is the lowest. Proponents of universal health care have often criticized the US policy of leaving a larger proportion of the health sector in the hands of competitive market forces, but this has been justified by its government and policy apologists by saying that universal health care coverage will require higher taxes and a great likelihood of poorly performing health care facilities and physicians.
That elderly population which accounts for a more than proportionate share of government spending on medical and health care consist of those who are 65 or over and who need some help with day-to-day tasks and health care, but who want and deserve dignified aging. At the same time, this group is also prone to neglect in maintaining a healthy lifestyle, and requires critical government assistance so that they do not fall Prey to the weaknesses and sicknesses often afflicting this population.
While ageing is inevitable, there is no major physical disability. In their later years people will lead safe, disability free lives. A well-established support system of family, friends, and health care providers, along with a focus on good nutrition and lifestyle habits, and effective stress management, can prevent disease and lessen the impact of chronic conditions. Both the government and some helpful organizations can contribute their share to achieving a healthy senior population.
Preventative measures can also help. Such health practices as healthy diet, daily exercise, stress management, and control of lifestyle habits, such as smoking and drinking, can lengthen the life span and improve the quality of life of this age group. Exercise can improve appetite, bone health, emotional and mental outlook, digestion, and circulation.
It has also been observed universally that retirees tend to get sick and die early. Retirement is very damaging to health. According to the Australia 2020 Final Report, older people need a reason to stay engaged, and that consideration should be given to abolishing retirement and to reinventing different types of productivity. Of course, the state of health that seniors find themselves in often are the cumulative effects of poor health habits many years before retirement, hence an integrated approach should Consider adopting healthy habits and activities for all ages, not only when the individual has retired.
Our society should be a moral concern for all policymakers because of lack of understanding or empathy for this group. These elderly people, the veterans among us, contributed their share in building our nation and society, and they deserve our consideration and thanks. The heritage that their work created, while plain and recognizable, are often taken for granted. Because of the compulsory retirement policies of many countries, these group of individuals are often forced to assume inactive roles in our communities although they may still have usable experience and wisdom acquired through many years of meeting challenges in the workplace, experience that they can share with the younger generation. Their skills and capabilities become a great loss to society. At the same time we allow them to deteriorate in idleness and infirmities unless they voluntarily or through the help of others become engaged again in meaningful work. There is also a continuing urge for many of them towards generativity, as a way to contribute something enduring for the benefit of future generations.
In many countries, tapping the talents, experience and energies of retirees, if they are willing to be active again, can avoid the demand for immigrant workers. Studies have also shown that, at least in the United States, a program to promote health among the senior population can generate savings in medical care costs amounting to at least $260 billion annually. (Hooyman and Kiyak 1999)
Australian Policy Framework
The Australian Summit 2020, in its Health Stream, considered a long-term health strategy for Australia that included five main themes – healthy lifestyles; health promotion and disease prevention; health workforce and service provision; addressing of health inequalities, future challenges and opportunities in health; and health research, research translation, and research training. Healthy lifestyles involved universal access to a health system with due regard to the environment; while health inequalities were to be addressed through, among others, a system focused on prevention (‘A ‘wellness footprint’). With relevance to the elderly population, future challenges and opportunities in health were to have a human-centric health system focused on wellness as well as productive ageing. In this regard, families and individuals were to engage in wellness activities and older people were to “achieve a health participation in the community, and for society to value them more.”
The Summit also recognised individual and population ageing as opportunities for the reassessment of the health system structure. There was a need to “focus on prevention and promotion of health to prolong the ageing population’s useful life by encouraging Australians to be healthy and productive. Specific suggestions were as follows: a) Fundamental rearrangement of work, care, acute treatment and prevention to improve access by the ageing population; b) A funding system that is cost neutral and effective; c) a two-pronged supplementary health insurance system – one for long-term care and another for catastrophic conditions, done through another type of Medicare levy for aged care and for severe conditions and illnesses; and e) Greater mastery by every Australian for their own health at any age. Also, while Australia could contribute to regional health programs, she could also learn from other countries, such as, for example, Japan about affordable and healthy ageing.
A National Preventive Health Agency as Model
The Summit further suggested the creation of a National Preventive Health Agency which will be authorized to raise funds through, among others, taxing tobacco, alcohol, and junk food. More specifically, the Agency would raise the present tax on cigarettes by 2.5 cents, impose a volumetric tax on alcohol, as well as abolish duty-free importation of alcohol and cigarettes into Australia, and exact taxes on low-nutrient high-energy junk foods. The model for the Agency shall be the Victoria Health Promotion Foundation (Vichealth), a statutory authority established by the Victoria Parliament in 1987 as part of the Tobacco Act, tasked to promote health and prevent ill-health in Victoria in partnership with organizations, communities, and individuals. The strategic priorities of Vichealth for the Victoria population of all ages cover control in tobacco consumption, overweight and obesity, physical inactivity, social exclusion, discrimination, violence, and alcohol misuse (‘The Victorian Health Promotion Foundation).
The Rudd government has pledged to invest $2.5 billion in a National Health and Hospitals Reform Plan to reform Australia’s public hospitals and the broader health system, in working partnership with the state and territory governments. While the program has universal application, the same themes of preventative health care and health promotion reverberate, to“help Australians healthy and out of hospitals” (‘The Rudd Government is committed …’). Additionally, measures to help this age group have been put forward, including the increase of operational aged care beds, $300 million in zero real interest loans to aged care providers, among others. The preventative health care approach was to focus on the burden of chronic disease caused by obesity, tobacco and excessive alcohol consumption, for which a Task Force was to be established.
While it is true that Australian government has tried to address the problems of the Australian senior population, there is a need to formulate a concrete integrated program which from our point of view would benefit the senior population, while at the same time reducing the burden on the government.
The goals and objectives of this proposal shall consist of the following:
- A policy to abolish the compulsory retirement of workers and employees of private corporations, government corporations, and the government services at all levels. All retirement decision shall be optional on the part of the employee concerned, and for as long as he or she can contribute value to the organization through work, his or her services should be retained. In case the employee retires but after some time decides to return, he or she should not be subjected to discrimination. He should be evaluated as a candidate on the basis of his or her worth to the prospective employer, not taking into account age or the fact of having previously retired. Compensation should also be based on the potential value of his or her contribution.
- A national program of educating all individuals on the value of healthy lifestyle should be launched in schools as well as outside the classroom walls for Australians of all ages. A special training module should also be created and applied for the elderly population. A financial incentive or incentive in kind may be included in order to pry the seniors out of their armchairs and homes and join others in outdoor activities to promote cardiovascular fitness, strength and health. Include the Chinese tai chi exercises for strengthening and balancing to reduce the incidence of accidental falls.
- Heavily tax cigarettes, alcohol consumption, as well as consider excise taxes on junk foods in order to discourage or minimize consumption, and in order to help fund the program.
- Provide opportunities for seniors to find outlets for creative as well a volunteer work. Seminars and workshops on crafts and arts and on other forms of creative forms of expression such as painting, pottery, sculpture, music, should be provided for free. They may also be encouraged to explore the possibility of commercializing their new interests so that they can earn some incomes besides their pensions.
- Educate the elderly on the importance of nutrition, by encouraging consumption of fruits and vegetables, complex carbohydrates, and by restricting the intake of sugar, fat, and cholesterol-containing foods. Giving them generous discounts or subsidies would help keep them away from hospitals and costing the government lots of money.
- Teach them stress management skills and self-management to control depression.
- Equip the government, schools, non-governmental organizations, corporations which are aware of and want to manifest their sense of corporate social responsibility, and other groups with the wherewithal and skills to respond promptly and contribute to this effort.
- Establish an organizational structure within the Ministry of Health and Aging to initiate and organize activities, and potentially support non-governmental organizations that may be interested in taking up the project cause of the elderly population.
A budget in the amount of A$300 million annually shall be appropriated in order to implement this program nationwide. This funding shall be generated from the federal budget as well as from the revenues from taxes on tobacco, alcohol, and junk foods. This amount shall be broken down into program expenditures, including funding of NGOs, and administrative expenses.
These policy recommendations fall within the framework of government policies and priorities as stated in the National Health and Hospitals Reform Plan, and are also consistent with the ideas and recommendations of the Summit 2020 Final Report.
They are also consistent with probable measures needed to address the emerging trend in high health care costs in developed countries such as the United States. Considerable amount of studies have recommended preventative health care but policy makers have not given them due consideration (Cox 2000; Hooyman and Kiyak 1999). Even the health care plan initiated by the Clinton administration in the past did not gain acceptance among U.S. lawmakers.
The program’s contiguity with the overarching policies, plans and programs of the national government is expected to generate support not only from the governments at all levels, but also from civil society groups and the citizenry. Any objection would be a matter of fund allocation, not about the project’s importance and effectiveness in accomplishing the twin objectives of reducing government expenditure on health cost and of improving the quality of life of this specific population and therefore of the public in general. Funding can be generated from taxes imposed on cigarettes and alcohol as well as on junk foods, as it has been done for Victoria; and if insufficient, it will seek support from the national budget as well as contributions from corporations and interested groups and individuals who can identify themselves with the values represented by the program.
There is no doubt that the program will be effective in achieving its economic goals, thus indirectly contributing to general welfare by freeing up funds for other development programs and projects of Australia. The program deserves to top priority because of its potential benefits both in the short term and the long term.
Because the program does not seek to benefit any group with a political bias one way or the other, it will be acceptable to all sectors and all groups of different political persuasions. The senior population can also be a potent political force if it is convinced that it has the attention and concern of the state, and would be able perhaps to influence or affect the results of political exercises. The program is considered politically feasible.
The stakeholders are the government at the commonwealth, state and territory levels, the academic institutions, non-governmental organizations, corporations sensitive to their responsibility towards society, other age groups who will benefit or perhaps feel otherwise affected by the program, politicians, pressure groups, the press, legislators, the courts, as well as the members of the intended beneficiary, the elderly population.
The politicians would be expected to support the program if the elderly population can be aroused into a potent political force. The press would probably be divided on the issue of pursuing the program but in general they would be persuaded to see the light, the advantages of this program from the economic and social-equity viewpoint. The local governments and NGOs would support the program if they can be convinced that it makes economic sense and if they have the capabilities or are given the additional capabilities to implement the program. Because the program falls under the mission and goals of the Australians government health plan, the program is not expected to encounter rough sailing within the present government. The opposition politicians are also expected to find common cause with the proponents and implementors of the program.
The main implementing body shall be the Ministry of Health and Ageing, with a core organization within the Ageing Department. It shall be empowered by legislation to tax certain products such as tobacco and alcohol, as well as to seek the assistance and contribution of various groups who believe in the program. The details of the organizational set up shall be determined by the Ministry of Health and Ageing.
The benefits of the program shall be determined by first making a projection of health and medical care costs as projected from past trends. Then the impact of the program shalls bve determined from the difference between projected costs and actual costs, expected to be lower than project. The results are not expected to be seen as dramatic during first year of implementastion but should become more evident from the second year onwards.
The benefits are expected in the medium term to far outweigh the costs. A cost-benefit analysis of cost-effectiveness analysis would demonstrate the value of this pioneering project, to wit:
- The reduction of ill health and hospitalization of the senior population would reduce government expenditure for health and medical care of this age group and thus avoid the worldwide trend of escalating health care costs, particularly as the baby-boom generation is going to swell the senior population in the very near future.
- A better quality of life for the elderly and their families would results, an improvement that is difficult to quantify but is nevertheless considerable.
- Folland, S, Goodman, AC, & Stano, M 1997, The economics of health and health care, 2nd edn, Prentice Hall, Upper Saddle River, NJ
- Ogle, J 1984, Ageproofing, New American Library, New York.
- Hooyman, NR & Kiyak, HA 1999, Social gerontology: A multidisciplinary approach, 5th edn, Allyn & Bacon, Needham Heights, MA.
- Cox, H 2000, Aging, 13th edn, Dushkin/McGraw Hill, Needham Heights, MA.
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- ‘Elderly Care’ (n.d.). Viewed June 27, 2008 (http://www.answers.com/topic/elderly-care,).
- ‘The Rudd Government is committed …'(n.d.). Viewed June 27, 2008,b <http://www.australia.gov.au/Australian_Facts_&_Figures>
- ‘Preventative-health-strategy.’ (n.d.). Viewed June 27, 2008, <http://www.preventativehealth.org.au/internet/preventativehealth/publishing.nsf/Content/national->
- ‘A ‘wellness footprint’…( n.d.). Viewed June 27, 2008,<http://www.australia2020.gov.au/docs/final_report/2020_summit_report_full.doc>
- ‘The Victorian Health Promotion Foundation (VicHealth)’ (n.d.). Viewed June 27, 2008,<http://www.vichealth.vic.gov.au/ >
A NATIONAL PREVENTATIVE HEALTH PROGRAM FOR
AUSTRALIA’S SENIOR POPULATION
Submitted by the
AUSTRALIA FOR ENDURING WELFARE AND PROSPERITY, INC.
Letter of Transmittal
The Minister of Health and Aging
On behalf of my organization, the Australia for Enduring Welfare and Prosperity, Inc., I have to honor to submit herewith my proposal titled, “A National Preventative Health Program for Australia’s Senior Population.”
This proposal was generated by my organization, bearing in mind the National Health and Hospitals Reform Plan of the government and the Summit 2020 Final Report, in order to address two basic issues which we believe are today confronting the Australian government: 1) the rapidly spiraling cost of medical care, a phenomenon which has just been recognized in the United States and other developed countries, caused by the disproportionately large burden due to the elderly population, and threatening national welfare in many countries as the baby-boom generation is soon reaching retirement age; and b) the absence of a concerted, meaningful approach to reduce medical and health care costs of the elderly population, which has been mainly responsible for the significant increase in total health care budgetary expenditure of most governments, including the Australian government.
This proposal outlines the measures that are suggested for adoption by our government, the cost of the program, and the benefits to be derived from its implementation. A budgetary funding is suggested, derived partly from new taxes, with the Ministry of Health and Ageing being proposed to head the implementation machinery.
Your kind consideration of the attached Proposal would be appreciated. Please inform us at your earliest convenience of any action you will have taken on this Proposal.
Very sincerely yours,
AUSTRALIA FOR ENDURING WELFARE AND PROSPERITY, INC.
Media reports highlighting relatively high inflation for calendar year 2007 have singled out the significant role of high medical and health care costs in producing high inflation rates in the United States and other developed countries. There is an increasing pressure for governments to address the problem of high inflation, particularly because the high costs of energy have helped bloat prices of many goods and services beyond the normal ranges of many years. Given prominent mention in these reports was the role, unprecedented in budgetary history, of medical care costs accounted for by the senior population in the United States. With the baby-boom generation retiring in about two years, it is expected that medical and health care costs can rise even more worldwide.
This proposal seeks to address the issue of high and rapidly escalating medical care costs, perhaps not yet very perceptible in Australia but threatening to be thrust into the public consciousness in the near future, for which the elderly population is responsible. If we can, through government action, carry out a health preventative program for the elderly population within the framework of current government health policies, it would be possible simultaneously to reduce the threat of medical care costs running out of control in the future, depriving the government and our citizenry of funds that otherwise would have been made available for development projects with long-term impacts. The proposal seeks to make the elderly healthy enough stay out of hospitals and be active members of the community.
The proposal has enumerated several measures to carry out a program for preventative health care for the senior population. It also seeks to realize the following:1) establishing an organizational unit within the Ministry of Health and Aging to implement and coordinate program operations, 2) tapping the assistance and capabilities of existing organizations, institutions, groups and individuals to help carry out the goals and objectives of the program. The proposal has a recommended budget and incentive plans so that seniors will cooperate.
The program will be economically efficient in that it is proposed to be funded from the health program budget of the national government as well as from the proceeds of taxes on “sin” products such as alcohol and tobacco. It should also be open to contributions from corporations and other groups who will find common cause with the government. Also, the benefits in terms of hospital stays avoided and government budgetary savings and improved quality of life of the elderly, are expected to outstrip the funding costs to the government. The project has no bias for or against any political party, and will benefit a group with the numbers and the potent ability to elect or cause defeat of political candidates.
Because the proposal falls within the framework of the national health policies and priorities of the present government, it is expected to generate substantial support from all sectors.