Health Policy in Ageing Populations: Economic Modeling of Chronic Disease Policy Options in Australia


Overview of Australia’s Chronic Disease Model

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Agnes E.G. Walker and James R.G. Butler


This chapter starts with the initial proposal for building the HealthAgeingMod model-system. It then follows through the major steps involved in carrying out the initial literature searches; research on how to implement the novel features proposed; assessment of the best way to treat each element of the system; examination of the data and methods to be used; and the building and validation of a complex individual-based and nationally representative chronic disease model-system. It also documents the difficulties and modeling pitfalls encountered and describes how the project evolved from the initial detailed plans, through the building of a prototype, and the final, validated version of HealthAgeingMod.

The outcome is a policy relevant tool in which chronic disease progression models are linked to a population-wide microsimulation projection model. The system accounts for individuals’ demographic, socio-economic and health characteristics, comorbidities, health expenditures, quality of life, work prospects. Its outputs are estimates of the costs and benefits of simulated policy interventions. HealthAgeingMod is a validated personlevel system able to simultaneously account for diabetes and cardiovascular disease (CVD), with the possibility of extensions to other major chronic diseases.


Common health risk factors, diabetes, cardiovascular disease, comorbidities, chronic disease onset and prevalences, nationally representative data sources, psychological distress, model building.


Australian Centre for Economic Research on Health, Australian National University, Australia