A damning report on Australia's health system, which calls for greater attention to preventative health, has been welcomed by experts.

But some point to major challenges on the horizon.

The report from the National Health and Hospitals Reform Commission this week says Australia's $94 billion health system is too focused on illness at the expense of wellness.

Despite increasing health awareness, many Australians don't make healthy choices because they can't afford to or because of their living environment, the report says.

It says chronic diseases caused by lifestyle or risky behaviours eat up around 70 per cent of the health dollar, yet comparatively little is spent on preventing such diseases.

"We commit less than 2 per cent of the health budget to a problem which consumes a major proportion of health expenditure," says the report.

"We have a health system skewed to managing sickness rather than encouraging wellness."

The report recommends the establishment of an independent National Health Promotion and Prevention Agency, early intervention and a rolling series of ten-year goals for health promotion and prevention.

It also calls for better equity in access to health care for Aboriginal people, people in rural and remote areas, as well as those with mental health and dental care needs.

Exciting report

Public health experts have welcomed the report's focus on preventative health.

"We're really delighted," says Michael Moore of the Public Health Association of Australia.

"It's quite exciting as far as we're concerned."

"We've never seen before a report such as this with a focus on the healthcare system that is also talking about prevention," says public health expert Professor Rob Moodie, of the University of Melbourne.

"We see that as a huge positive."

"We need to be much better at building the fence at the top of the cliff, not just being the ambulance at the bottom," says Professor Moodie, who is chair of the Preventative Health Task Force, whose report is expected to be released soon.

Money matters

Mr Moore says one challenge in implementing the report's recommendations is the costs in a time of economic global crisis.

"I think the biggest challenge is the money," he says.

Mr Moore says spending on prevention will not necessarily save money if people live longer as a result of not getting sick, but it does mean that people will have better health and quality of life.

"Prevention still costs money," says Professor Moodie. "But it uses the money a lot more effectively"

"We'll get a better outcome for it by virtue of reduced premature deaths, reduced suffering and better productivity."

Beyond health

Both men say preventing illness involves changes in a range of policy areas beyond health.

"You can't look at obesity and food without looking at how food is farmed and manufactured," says Mr Moore. "These are dealt with by different departments."

Professor Moodie says the Preventative Health Taskforce will examine policy and levers in the area of transport, sport and recreation, urban planning, education, industry, media and advertising.

"If we want to substantially improve our health then we have to deal with all those sectors and the three levels of government as well.

'Healthy public policy'

Urban public health expert Dr Chloe Mason says what is really needed is "healthy public policy", in which all government portfolios are responsible for promoting health, not just the health portfolio.

For example, she says, the British Medical Association recognised more than 10 years ago that roads budget needs to be spent more on "health promoting transport" and less on "health damaging transport".

"It would be a mistake to see all of the money for prevention to be channelled through the health system," says Mason, an associate at the Institute for Sustainable Futures in Sydney.

"There are huge budgets that could be shaped towards more healthy outcomes."