Environmental, Social and Governance principles in Australian publicly funded healthcare: an extension of value-based care.

Abstract

Australia's publicly funded healthcare system is financed through a complex mix of Commonwealth, State, Territory and private sources, which include activity-based funding, fee for service and block funding. These models may be insufficient to meet future budgetary constraints, and healthcare systems in Australia and worldwide are increasingly adopting value-based healthcare (VBHC), which is defined as 'health outcomes that matter to patients relative to the resources or costs required, over a full cycle of care'. There is no national Australian strategy for the adoption of VBHC, and examining other industries or policies may provide solutions to enhance implementation. For example, as of January 2025, the Australian Securities Exchange will mandate climate-related disclosures for listed companies. This change reflects a growing societal and shareholder emphasis on environmental accountability. Our paper argues that universally applying Environmental, Social and Governance principles across all healthcare sectors represents a strategic evolution of VBHC to ensure fiscally responsible climate change mitigation and adaptation strategies.