The false dichotomy of public health and the economy

Louisa Gordon


Six months into the COVID-19 crisis and Australia is faring well on a global scale. Contributing factors are the border closures and united public health decisions based on scientific advice. It helped to have a giant moat around the country too.

While Australia has been largely successful in preventing COVID-19 disease, more focus has switched to the economic fallout. People have lost their jobs, businesses are folding, and consumers are staying away in what is called ‘The Great Lockdown’. The employment effects are devastating.

Leaders and scientists must judge whether the risk of opening the economy in the face of a powerful and deadly virus with no vaccine or reliable treatments is acceptable, and trust that any outbreaks can easily be ring-fenced. Victoria’s second wave has shown how fragile this balancing act is. Prior to Victoria’s influx of cases, and even still, there are divisions among the community and leaders about whether to relax imposed restrictions and open the economy. An open letter to the Government from 200 Australian economists supported the continued public health efforts and warned against sacrificing the good success to date in the name of the economy.

The truth is, a healthy population and a healthy economy go hand in hand. If the workforce isn’t healthy, there is reduced economic productivity. The exponential growth in infections we are working so hard to prevent through restrictions and lockdowns is accompanied by a much greater number of healthy, uninfected people who can continue to be productive. When prevention works, it gives the deceptive appearance that nothing has happened.

The effects of poor prevention are clear in other situations abroad. For example, Brazil and Colombia produce about 50% of the worlds coffee, but the pandemic is affecting fieldwork so harvests are down. Beyond the direct effects of sickness reducing workforce participation, fear of a virulent virus in the community can result in a reluctance to spend. This is particularly true of wealthier middle-aged and older Australians who are at higher risk of severe COVID-19 disease.

Weighing up the pros and cons of opening the economy is a cost-benefit analysis of a massive kind. It requires evaluating a suite of public health policies with impacts that flow into all areas of society. Health economists do these analyses on a much smaller scale to assess the costs and benefits of healthcare interventions, assisting health providers to invest in the best buys. Current evidence shows that most public health prevention strategies save lives AND save costs, but it’s a long game.

Although the pandemic is still unfolding, there have actually been many positive effects of COVID-19 on public health. We have seen the success of preventive measures such as border closures which allowed Australian hospitals to prepare for mass testing and severe cases requiring intensive care. Telehealth services have been boosted across states and territories, allowing for greater access to GPs, allied health, and specialist virtual delivery of healthcare. Community care services were also ramped up via the Care Army to support the elderly and vulnerable with basics like groceries and medicines. Some states have become more proactive, with Queensland Health mobilising resources for supporting patients in an ongoing manner and increasing the state’s preparedness for the pandemic.

The crisis has also led to other benefits such as more housing being provided for the homeless, increased funding to prevent rising domestic violence, and decreased rates of seasonal influenza as a result of social distancing and increased hygiene. There have also been signs that lockdowns might lead to increased physical activity among some people, as well as a rise in cooking healthier foods at home.

However, there are concerns about the negative ripple effects of COVID-19 on other areas of health. Patients with chronic and acute conditions may be under-diagnosed and under-treated due to cancelled or strained health services and a fear of attending appointments or presenting to emergency hospital departments. People with mental health issues, people with disabilities and the elderly face an extra set of challenges in isolation and lockdown which can seriously impact on their quality of life. Increased alcohol intake and unhealthy food consumption are also a concern, as well as reduced opportunities for physical activity among some groups.

Of course, many more harms and benefits will accrue beyond the health sector. But we do need a comprehensive health economic evaluation of the Government’s health response to COVID-19 to provide a transparent account of the costs, cost-savings, health benefits and harms. We also need to use this evidence to scrutinize alternative strategies that may have produced better outcomes.

As the pandemic continues to rage around the world and impact on the global economy Australia will not escape the effects. Australia has so far used a balanced approach to COVID-19, aiming to meet public health and economic objectives – hence the birth of ‘coronanomics’. Our continued success at valuing both objectives rather than trading one for the other will help to sustain our society and economy and aid recovery.


Associate Professor Louisa Gordon is a Health Economist, Senior Research Fellow and Group Leader of Health Economics at QIMR Berghofer Medical Research Institute. A/Prof Gordon holds a Bachelor of Economics and a Masters’ degree and PhD in Public Health. Her program of research is devoted to evaluating the cost-effectiveness of health interventions for cancer populations and the financial burdens of cancer survivors. A/Prof Gordon has extensive experience performing economic evaluations, decision-analytic modelling and applied economic research. A/Prof Gordon is a member of the Public Health Association of Australia, the Australian Health Economics Society and Health Services Research Association of Australia and NZ.

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