Australia can’t treat its way out of dementia: prevention and allied health are the missing link

by Gillian Woodhouse, a health and life sciences strategist with executive qualifications in health and aged care leadership, specialising in prevention, governance and health policy. 

Anthony Albanese’s vision of Medicare as the nation’s “green and gold guarantee” embodies a proud ideal: that when Australians fall ill, they won’t face financial ruin or exclusion. But if we truly value universal access, this promise must extend beyond treatment to prevention, because the health system is currently designed to manage dementia, not to combat it.

New data from the Australian Bureau of Statistics shows dementia is now the leading cause of death, claiming more than 17,500 lives in 2024 and accounting for nearly 10 per cent of all fatalities. This represents a 39 per cent increase over the past decade.

Most of these deaths occur in people over 75, reflecting both our ageing population and a rising health burden. Without a strategic shift toward prevention, this trend will only accelerate.

Dementia is not an inevitable consequence of ageing. Evidence from the Australian Institute of Health and Welfare (AIHW) suggests up to 40 to 45 per cent of dementia risk is linked to modifiable factors such as physical inactivity, hearing loss, obesity, hypertension, diabetes, depression and social isolation.

This is not academic nuance. It is actionable insight.

Many of the interventions which reduce dementia risk are delivered by allied health professionals: physiotherapists who improve strength and cardiovascular fitness, dietitians who support brain-healthy nutrition, audiologists who treat hearing loss, psychologists who address depression and social isolation, and occupational therapists who support cognitive stimulation, independence and daily function.

Despite this, Australia’s health system remains heavily weighted toward diagnosis and late-stage care.

In 2020-21, the AIHW estimated that $3.7 billion in direct health and aged care expenditure was attributable to dementia, with the overwhelming majority directed to hospitals and residential aged care.

By contrast, out-of-hospital services – where allied health sits – accounted for only a small fraction of spending, even though this is where early intervention and prevention happens.

Aside from health impacts, these funding choices also have significant economic consequences.

Projections from the University of Canberra show the total annual costs of dementia, including indirect costs such as informal care, lost productivity and income support, could reach $26.6 billion by 2041 if we do nothing different.

Secondary analysis based on the AIHW data shows allied health currently represents a tiny sliver of this – barely one per cent of total direct dementia expenditure.

This imbalance is not just clinically short-sighted. It is economically irrational.

If Medicare is Australia’s social contract, it must recognise prevention requires sustained, accessible allied health support, not just episodic GP visits or crisis-driven hospital care.

At present, Medicare funding for allied health is limited and fragmented, creating financial barriers to the very services that could delay cognitive decline and preserve independence.

The result is a system that currently pays far more to manage advanced disease than it would to prevent or slow it.

Prevention does not offer guarantees, but decades of research show by improving physical activity, managing cardiovascular risk, treating hearing loss, supporting mental health and maintaining social engagement can meaningfully reduce dementia risk and slow progression.

These interventions are already well understood and widely delivered. What is missing is a funding model that treats them as essential infrastructure rather than optional extras.

The human cost of inaction is significant. Australians living with dementia, along with their families and carers, deserve a system which supports dignity, function and quality of life, not one that waits for crisis before responding.

When preventive care is underfunded, opportunities to maintain independence are lost, and pressure on hospitals and aged care services grows.

Medicare was created to reflect who we are as a nation. If the green and gold card is to continue standing for fairness and access, it must evolve to meet the realities of an ageing population and the preventable drivers of disease.