Dec 12 2018
The Public General Hospitals industry has grown strongly over the past five years, as Australia’s population has continued to age, resulting in increased demand for industry services.
“Growing demand from Australia’s ageing population has been a key driving factor for public hospitals. However, uncertainty surrounding funding arrangements over the past five years has made it difficult for hospitals to invest in expansions and new technology, limiting their growth over the period,” said IBISWorld Senior Industry Analyst Liam Harrison.
The Public General Hospitals industry includes all hospitals that provide public health services, with the exception of dental and psychiatric hospitals. Public-private partnerships that provide public hospital services are also included in the industry. The industry has a high market share concentration, with each state and territory health authority’s market share being roughly in line with its share of the population.
Despite rising health consciousness in the community, the total number of individuals that are either overweight or obese is projected to increase over the next five years. This trend is anticipated to strengthen demand for public hospital services, as incidences of obesity-related illnesses and diseases are expected to increase. The Public General Hospitals industry’s revenue is expected to increase at an annualised % over the five years through 2023-24, to reach .
Public hospitals have been a considerable threat to private hospitals over the past five years, particularly as private health insurance membership per capita has fallen as a result of declining private health insurance affordability. However, this trend is expected to reverse over the next five years, as government legislation attempts to reduce the complexity and increase the affordability of private health insurance. These changes are anticipated to increase demand for private hospitals and therefore lower demand for public hospital services. Despite this, increased demand from Australia’s ageing population is expected to drive demand for both public and private hospitals, with both industries expected to perform more strongly over the next five years, compared with the previous five-year period.
Overall, the Public General Hospitals industry is forecast to grow strongly over the next five years, despite efforts to increase the competitiveness of private general hospitals. Australia’s ageing population, rising obesity rates, and other negative health factors are anticipated to increase demand for both public and private health services over the next five years.