Tax-free prescribed exercise could save millions

A little-known form of allied health could save the government millions of dollars in healthcare costs annually, according to advocates campaigning for it to be made tax-free.

Exercise and Sports Science Australia (ESSA) has called for exercise physiology costs to be exempt from GST, arguing the intervention saves millions in government expenditure for chronic illness.

Taxing healthcare undermined the original intent of the GST legislation, ESSA chief executive Kate Lyndon said.

"Knowing what we know now, it makes no sense that Australians living with chronic disease, disability, injury and mental health conditions should have to pay an additional 10 per cent for this essential healthcare," she said.

Australia spent an additional $78.1 billion on disease and injury between 2014 and 2024. Chronic conditions accounted for 60 per cent of that expenditure growth.

But engaging exercise physiologists for structured help treating chronic issues saved about $940 million over three years, a Deloitte report commissioned for ESSA said.

It assessed six categories of health conditions: cardiovascular, pulmonary, musculoskeletal, mental health, physical disability and cancer, to find that the benefit per patient equated to about $2000.

The savings were made largely through avoiding hospitalisations and emergency department presentations, but also accounted for costly general practitioner visits.

More than one in three Australian adults do not meet physical activity guidelines, putting significant strain on the healthcare system, the report said.

Increased investment in physiologists could help solve that, Ms Lyndon said, noting a net gain for the economy overall if Australians were healthier.

"The report highlighted how exercise physiology interventions have the potential to address the health burden both directly and indirectly through improvements in physical functioning, symptom management, psychological wellbeing and overall improved independence," she said.