Economic studies of Australia's allied mental health services under Medicare: Innovation, diffusion and geographic distribution

Submission note: A thesis submitted in total fulfilment of the requirements for the degree of Doctor of Philosophy to the School of Economics, Faculty of Business, Economics and Law, La Trobe University, Bundoora.

The purpose of this thesis is to bring a recent innovation in mental health services in Australia under the lens of economics. The innovation is the Medicare-financing of the services of private fee-for-service allied mental health services. Following the 1990s reforms in Australia’s mental health services sector, some key economic implications of bringing allied mental health services under the Medicare financing scheme are examined, with a particular emphasis on innovation and regional diffusion. The services under study here are of the four allied mental health provider groups that have become financed under Medicare; these groups are the clinical psychologists, general psychologists, occupational therapists and social workers. Their funding through Medicare resulted from a Council of Australian Governments (COAG) initiative in 2006. The allied mental health professions in Australia have undergone an expansion this century, in accordance with all allied health professions now brought under the umbrella of Medicare. This thesis examines only allied mental health services; allied mental health services are not a special case, although some important differences which relate to mental health services are highlighted. This thesis reports empirical results on various measurements of service utilisation and regional distribution using State and Territory data. Two measures are applied: the Herfindahl-Hirschman measure of concentration of service-type and the Coefficient of Variation measure of spatial dispersion. Also, to detect regional differences in diffusion, equations on time series data for each Australian State and Territory are statistically estimated on data on service utilisation per 1,000 population. By applying economic analysis of both a conceptual and empirical kind, the thesis proposes to shed some light on the effects and complexity of this financing innovation within these allied professions, and Australia’s mental health policies for the care of mentally ill people. Thus, the intention of this thesis is to contribute to a better understanding and knowledge of the outcomes of mental health services across Australia, and in regional and remote areas in particular.