Are the benefits of new health services greater than their opportunity costs?

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2 Citations (Scopus)


The Australian health system performs well compared with other developed countries, but there is potential for improved health outcomes through the consideration of the opportunity costs of funding new health services. The opportunity costs of funding a new health service are the benefits forgone from the activities that would be funded if the new health service was not funded. When the forgone activity cannot be observed directly, the expected opportunity costs have been estimated as the expected gain in quality-adjusted life years (QALYs) associated with marginal increases in government expenditure on health. We have previously estimated that a gain of 1 QALY is expected for every additional A$28 033 of government expenditure on health. This paper discusses the relevance and proposed use of this estimate of opportunity costs to inform decisions around the public funding of new health services in Australia.

Original languageEnglish
Pages (from-to)508-510
Number of pages3
JournalAustralian Health Review
Issue number5
Early online date10 Dec 2018
Publication statusPublished - 2019
Externally publishedYes


  • health policy
  • health services research
  • health systems
  • population health


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