COVID-19 impacts on health activity
There have been notable impacts on health activity from COVID-19 during the March quarter that can be seen across measures in the National Accounts.
Government response to managing health crisis
Australian governments worked to ensure that the health system could cope with the escalating COVID-19 outbreak. Additional funding was allocated to boost emergency response and intensive care capabilities, as well as shifting resources away from elective surgeries, to increase hospital capacity for a predicted surge in coronavirus cases.
The National Medical Stockpile was boosted significantly with purchases of medical supplies such as pharmaceuticals, personal protective equipment (PPE) and respirators.
Governments also expanded frontline services with additional call centres and helplines, pop-up testing clinics, as well as significant advertising and training programs. These were part of the Government’s $2.4 billion health package to protect Australians from COVID-19.
Total Government Final Consumption Expenditure (GFCE) increased 1.8%, with this spending across all levels of government in part reflecting the range of Government measures to manage COVID-19.
Figure 1: Government final consumption expenditure by sector, quarterly change, volume measures: seasonally adjusted
Household consumption behaviour in response to COVID-19
Total health spending by households fell 1.6% in the March quarter, with health services falling 5.3% partly offset by a 5.4% rise in spending on medicines, medical aids and therapeutic appliances.
Social distancing measures led to the reduction in demand for health services that involved face to face interactions, including general practice and allied services such as physiotherapy, dental and optical.
Conversely, spending on medicines, medical aids and therapeutic appliances surged as households prepared for the introduction of lockdown measures. Households stockpiled health goods such as pharmaceutical products and health supplements.
Figure 2: Household final consumption expenditure on health, quarterly change, volume measures: seasonally adjusted
Output of the Health industry
Health care and social assistance output fell 0.1% during the quarter, the weakest result since December 2011. Private health care fell due to the cancellation of elective surgeries and reduced demand in allied health. Public health care rose reflecting a range of government measures to increase frontline services and boost hospital capacity in response to COVID-19.
Figure 3: Gross Value Added (GVA) health care and social assistance, volume measure: seasonally adjusted