Prevention should be Australia's next big health investment

Australia has made enormous progress in treating diseases. More people are surviving heart attacks, strokes, and cancers. Medicines are better, clinical care is more sophisticated, and many biomedical risk factors are being managed more effectively than they were a generation ago. That is a success story worth celebrating. But it isn’t the whole story.

Australians are living longer, but many are also spending years living with illness, injury or disability. The policy challenge is no longer only about extending life but rather extending healthy life.

Australians are living longer, but not healthier

The latest Australian Burden of Disease Study 2024 that between 2003 and 2024, the age-standardised rate of total disease burden fell by 10 per cent, largely because fatal burden declined. However, the non-fatal burden increased by 7 per cent, meaning more Australians are living with illness, injury or disability rather than dying prematurely from them.

This should change how we think about health spending.

A health system that treats illness after it appears is essential, but it is not enough. If Australia wants people to live not only longer, but better, the next frontier is prevention.

The evidence points clearly in this direction. In 2024, more than one-third of Australia’s total disease burden could have been prevented or reduced by lowering exposure to modifiable risk factors. Most notably, overweight, including obesity, has now overtaken tobacco use as the leading risk factor contributing to disease burden in Australia. It accounted for 8.3 per cent of the total disease burden in 2024, followed by tobacco use at 7.6 per cent, dietary risks at 4.8 per cent, high blood pressure at 4.4 per cent and high blood plasma glucose at 4.2 per cent.

This is a clear indication that Australia’s health burden is increasingly shaped by risks that sit beyond hospitals and clinical care.

The shift from treating disease to preventing it

There is an important lesson in these figures. Some biomedical risk factors, such as high blood pressure and high cholesterol, have improved over time. The burden attributable to high blood pressure and high cholesterol fell substantially between 2003 and 2024, after adjusting for age.

This likely reflects, at least in part, better clinical management, improved medicines, and more effective treatment pathways. The Heart Foundation has noted that there have been significant advances in medications and treatments for hypertension and lipid-related conditions, and that updated clinical guidelines are needed to reflect contemporary best practice.

This is a notable outcome. It shows what can happen when evidence, investment, clinical practice and policy settings move in the same direction.

But it also tells us something important. Australia has become better at managing some of the medical consequences of chronic disease risk. The next challenge is to become better at reducing the behavioural and environmental risks that sit further upstream.

Why prevention is about more than personal choice

Poor diet, physical inactivity, tobacco use, vaping, alcohol and drug harms, and obesity are often described as lifestyle issues. But that term can be misleading.

People’s choices are shaped by the world around them: what food is affordable and heavily marketed, whether streets and communities make physical activity easy, whether children are exposed to unhealthy products, whether quitting support is available, and whether health information reaches the people who need it most. In other words, behaviour is not shaped by individual willpower alone. It is shaped by policy.

That is the central idea behind Australia’s National Preventive Health Strategy 2021–2030. The Strategy calls for a stronger, more balanced health system that places greater emphasis on keeping people healthy and well. It takes a systems-based approach to prevention, focused on the wider determinants of health, health equity, and the reduction of the overall burden of disease.

The Strategy identifies several priority areas that directly address behavioural risk factors. These include reducing tobacco use and nicotine addiction, improving access to and consumption of a healthy diet, increasing physical activity, reducing alcohol and other drug-related harm, and promoting and protecting mental health.

This is the kind of prevention agenda Australia needs: one that recognises health is shaped not only by clinics, but also in communities, workplaces, schools, transport systems, food environments and the broader economy.

Prevention deserves infrastructure-level investment

The National Preventive Health Strategy also includes a clear investment ambition: preventive health spending should rise to 5 per cent of total health expenditure across Commonwealth, state and territory governments by 2030.

That investment target is important because prevention has too often been treated as optional. It receives attention when budgets allow, rather than being seen as core health infrastructure. The Public Health Association of Australia has argued that Australia’s preventive health investment has remained below 2 per cent of health expenditure for most of the past decade and was 2.3 per cent in the most recent available data, well below the 5 per cent national target.

This gap matters. When prevention is underfunded, governments don’t avoid costs, they defer them. Those costs appear later through higher hospital costs, greater demand for primary care, reduced workforce participation, informal care burdens, disability, premature death, and poorer quality of life. They also appear in the economy through lost productivity, lower workforce participation and greater absenteeism.

As Australia grapples with an ageing population, workforce shortages and rising demand across the health system, prevention is not simply a health priority but an economic one.

What success looks like in practice

South Australia (SA) provides a useful example of how prevention can be translated into policy.

Preventive Health SA’s South Australian Tobacco Control Strategy 2023–2027 sets a target to reduce daily smoking prevalence among South Australians aged 15 and over from 9.8 per cent in 2021 to 6 per cent in 2027. The Strategy includes population-wide and targeted measures across social marketing, public education, evidence-based cessation services, reducing smoking prevalence in Aboriginal communities, smoke-free areas, regulation of products, marketing and supply, research, evaluation and enforcement, and preventing interaction with the tobacco industry.

This is an important approach because tobacco control shows that behavioural risk factors can change when governments act seriously and consistently.

Tobacco was Australia’s leading risk factor for many years. By 2024, however, the burden attributable to tobacco use had fallen by 41 per cent since 2003, after adjusting for age. That change did not happen through individual choice alone. It reflected decades of policy effort, including regulation, public education, smoke-free environments, taxation, and cessation support.

The same level of seriousness is now needed for obesity prevention. Preventive Health SA describes obesity prevention as a broad and multilayered strategy to address SA’s most significant public health issue: rising rates of overweight and obesity. Its work spans programs, public health education and policy, with the aim of addressing the complex causes of overweight and obesity, reducing impacts on people and communities, contributing to the National Obesity Strategy 2022–2032, and supporting healthier South Australians across generations.

This is the right direction. Obesity is not simply a matter of personal responsibility. It is influenced by food environments, pricing, marketing, availability, urban design, transport, education, income, and time. If unhealthy products are cheap, visible, heavily promoted, and easy to access, then unhealthy consumption patterns become more likely. Policy can help shift those settings so that healthier choices become easier, more affordable, and more normal.

The economics of prevention

Understanding what works is a public health challenge, while understanding where governments should invest is an economic one.

Public health policy often involves trade-offs. Governments need to understand not only whether a measure is likely to improve health, but also who bears the costs, who receives the benefits, how long benefits take to emerge, and whether the policy represents good value for the community. Economic analysis can help answer those questions.

Good economic analysis does more than count government expenditure. It can estimate avoided health system costs, productivity gains, improvements in quality of life, impacts on households and businesses, and the broader social value of healthier communities. It can also help compare different policy options, test assumptions, identify distributional impacts, and show whether benefits outweigh costs over time.

This is particularly important because prevention benefits often appear slowly, while costs are visible immediately. A public education campaign, regulatory change or community prevention program may require investment today, while the benefits may emerge over years through fewer chronic conditions, fewer hospitalisations, improved wellbeing and stronger workforce participation.

Without economic analysis, prevention can look expensive. With proper analysis, it is often clearer that failing to prevent illness is far more expensive.

Prevention must move from the margins to the centre

The national evidence is now pointing in one direction. Australia has made gains through improved clinical care and management of certain biomedical risk factors. But the growing challenge lies in behavioural and environmental risks that require action outside the clinic.

The National Preventive Health Strategy provides the framework. Preventive Health SA’s tobacco and obesity prevention work shows how this can be applied in practice.

The question is whether governments are prepared to invest at the scale required to drive the effective prevention strategies, and the level the evidence demands. Australia should not wait until more people become unwell before acting. If we want a healthier population, a more sustainable health system and a stronger economy, prevention must move from the margins of health policy to the centre of it.

To learn more about how economic analysis can support evidence-based health and prevention policy decisions, contact BDO's economics team.