Inequality in access to hospitals in Australia

An index of access to hospital services is constructed that calculates the accessibility of the nearest hospitals for the Australian population. Analysis using the index shows that the elderly, Aboriginal and Torres Strait Islanders and those from remote areas have substantially lower access than the population average. Inequality measures are applied to show that access to hospitals in Australia is much more unequal than the distribution of income, with a Gini coefficient of 0.61 and a conservative Atkinson index of 0.32. The welfare loss due to inequality of access is calculated at $2,200 per person, or $52.2 billion in total. Sensitivity analysis shows the main findings are robust to the effects of adding additional access components to the index and changing the number of hospitals considered. The index is applicable for policymakers looking to construct new hospitals or to expand existing hospitals. Policy simulations are run to evaluate the access gains from the Sunshine Coast University Hospital (SCUH) in Queensland and from relocating the capacity of the Alfred Hospital in Victoria. We find that the construction of the SCUH raises mean access in Queensland by 4.1%, raises access on the Sunshine Coast by 21% and increases inequality of access in Queensland between 2% and 7%. A comparable regional hospitals policy which raises access by 2.7% would need to cost less than 66% of the SCUH budget to deliver more access benefits per dollar. Closing the Alfred Hospital and reallocating its bed capacity to the Maroondah Hospital and the Northern Hospital increases access to hospitals in Greater Melbourne by 0.6% and reduces inequality of access by between 2% and 5%