The life expectancy of Australians is increasing due to advancements in treatment and medical technology, but a longer life doesn’t necessarily mean a better quality of life. Health and wealth play crucial roles in determining our quality of life as we age.

A recent report from Zurich Australia, “The Cost of Care: Volume 2,” provides data on health conditions, trends, treatments, and the financial strain chronic diseases can place on households, leading to delayed or forgone treatments and reduced household income due to decreased productivity.

While the report covers a range of health issues across 13 broad categories, we have selected a few key conditions to explore, looking at the prevalence and lifetime out of pocket costs of these conditions.

Cancer

The financial impact of a cancer diagnosis on households is growing at 6.8 per cent per annum, with out-of-pocket costs extending beyond the initial diagnosis and treatment. Cancer accounts for 17 per cent of the disease burden in Australia, with significant social and economic impacts. In 2023, an estimated 165,000 Australians were diagnosed with cancer, averaging 450 new cases daily, with 40 per cent of diagnoses occurring between ages 25 and 64. The most common types are prostate, breast, melanoma, and bowel.

  • The lifetime chance of developing prostate cancer is 1 in 5, with up to 53 per cent of those diagnosed experiencing a recurrence. The average lifetime out-of-pocket cost is more than $42,000.
  • There is a 1 in 7 chance of being diagnosed with breast cancer, with up to 10 per cent of these cases occurring in people with an inherited gene abnormality. The average lifetime cost of breast cancer exceeds $41,000.
  • The likelihood of bowel cancer is 1 in 14, and over 60 per cent of patients requiring surgery experience out of pocket costs, which are almost $59,000 on average over the patient’s lifetime.
  • 1 in 14 Australians will be diagnosed with melanoma in their lifetime. It is likely to remain the most commonly diagnosed cancer in Australians aged 20 to 39. The average lifetime cost of a melanoma diagnosis is over $23,000.
  • The most expensive cancer treatment in terms of average lifetime costs is for head, neck and thyroid cancers, which exceeds $109,000.

Cardiovascular disease

These conditions include heart attack, stroke and high blood pressure, and are responsible for the death of one Australian every 12 minutes, affecting 1 in 6 Australians. Over 12 per cent of all healthcare expenditure is on cardiovascular disease.

  • There are 155 heart attack events every day, with the total lifetime costs exceeding $95,000.
  • The likelihood of stroke is 1 in 4, with average lifetime out of pocket costs exceeding $37,000.

Neurological conditions

Neurological conditions, such as dementia, epilepsy, Parkinson’s, MS, MND and brain / spinal cord injury can have a huge impact on the quality of life.

  • The likelihood of Epilepsy is 1 in 25, with estimated lifetime costs exceeding $27,000.
  • Parkinson’s affects 1 in 250 (increasing to 1 in 100 over age 60), with average out of pocket costs exceeding $190,000 over 12 years.
  • The risk of diagnosis with Multiple Sclerosis is 1 in 330, with annual out of pocket costs of almost $48,000.
  • MND affects 1 in 300, with an average lifetime cost exceeding $210,000.
  • Traumatic brain injuries are most commonly caused by falls, sports, motor vehicle crashes and workplace accidents. Someone in Australia is hospitalised due to head injury every 4 minutes. The lifetime costs of traumatic brain injury range from $3.4 million for moderate injury to $6.5 million for severe injury. The costs of tetraplegia (spinal cord injury) are estimated at $12.9 million, while paraplegia is estimated at $6.8 million. More than 80 per cent of spinal cord injury occur in the under 65 age group.

Mental health

More than 2 in 5 Australians have experienced a mental disorder in their lifetime, with 1 in 5 Australian experiencing a mental disorder in the last 12 months. This is most commonly anxiety, followed by affective disorders and substance use. The costs of mental health are significant, both in terms of out-of-pocket expenses (an average of over $1,000 per year) and losses in productivity.

  • 1 in 6 women and 1 in 8 men will experience depression during their lifetime, requiring over 75 days off each year because of their condition.
  • 1 in 3 women and 1 in 5 men will experience anxiety, taking an average of over 53 days off work each year.

The role of insurance

Insurance is crucial for covering out-of-pocket medical costs. Each condition discussed can lead to a claim that helps cover treatment and recovery expenses. With rising medical costs, it’s essential to have adequate coverage to reduce financial strain if your health declines.