The Vision for general practice

General practice as the solution to the health funding crisis

Last revised: 21 Oct 2019

Section 2: General practice as the solution to the health funding crisis

General practice is the most efficient part of the healthcare system, but requires more support

A well-resourced general practice sector is essential to addressing the existing and future challenges facing the health of Australians and the Australian healthcare system.

In 2016–17, Australian governments (including national, state and territory, and local governments) spent $124.1 billion on health.12 In the same year, total government expenditure on general practice was only $9.1 billion,13 representing only 7.4% of total health expenditure.14

Despite general practice being the most accessed part of the healthcare system, government expenditure per person on general practice is almost seven times less than hospital care.
 


 
Patients
 
General practice15 
$375
per person, per year
Hospitals
Hospitals15
$2606
per person, per year

 



Increased investment in general practice through supporting the Vision will bring about long-term savings for the healthcare system – through decreased use of hospital services (secondary care), improved illness prevention and improved productivity.

It is vital that any savings in health expenditure that result from increased activity in general practice are invested back into the general practice sector.

Investment in general practice reduces hospital costs

Local and international evidence shows that better support for, and use of, general practice is associated with:

  • lower emergency department presentations and hospital use16–19
  • decreased hospital re-admission rates20
  • health benefits for Aboriginal and Torres Strait Islander communities21,22
  • significant savings for the healthcare system.23,24

Emergency department presentations

In 2017–18 there were almost four million emergency department presentations triaged as semi-urgent or non-urgent.25 GPs can manage the majority of these presentations.

More than two-thirds of emergency presentations occur between 8.00 am and 8.00 pm, when general practices are most accessible.24 Most practices also have arrangements in place to support patient access to appropriate general practice care outside these hours.

Emergency department presentations cost Australia $4.9 billion each year.26  The RACGP conservatively estimates that well-coordinated GPs could manage nearly one-third of all emergency department presentations, saving $1.5 billion a year.

Preventable hospital admissions

Preventable hospitalisations are those that could have been avoided if timely and suitable non-hospital care had been provided.

In 2015–16, 6% of all hospital admissions were the result of 22 preventable conditions, which resulted in more than 2.5 million bed days nationwide. If these conditions were appropriately managed in the community, it would have saved the government an estimated $3 billion.†27

Better support and investment in general practice will reduce the prevalence of low-urgency emergency presentations and preventable hospital  admissions and could achieve savings of $3 billion and $1.5 billion respectively.
 


Emergency department

Emergency department
An annual saving of up to
$1.5 billion
if GPs and their teams were better supported to manage
low-urgency department presentations

 

Preventive hospital admissions

Admissions

An annual saving of up to
$3 billion
if GPs and their teams were better supported to manage
conditions commonly resulting in preventable hospital admissions


†Calculated using the average cost ($1000) for a preventable hospital admission patient day.

 


Increased preventive care through general practice will bring efficiencies and cost savings to the entire  health sector

Evidence-based preventive care and high-quality acute and chronic disease management provided through general practice will:

  • help people to live healthier lives and age well in the community
  • reduce disease complications and prevalence of preventable hospital presentations and admissions
  • reduce healthcare expenditure for government
  • reduce future out-of-pocket costs for patients
  • address health disparities and inequities experienceincrease the overall economic productivity of society.

Governments pay more for a single patient hospital admission ($502028) than the costs of that same patient visiting their GP twice a week for an entire year ($397329).
 


 
Hospital admissions
 
Average cost for one hospial admission28 
$5020
 
GP visits
Cost for a patient to see their GP for 2o minutes twice a week for an entire year29
$3973
 

 


Increased support for general practice will improve Australia’s overall economic productivity

A healthy society is a productive society. Poor health is associated with absenteeism and lower productivity at work.30 Labour force participation rates are consistently and considerably lower for people with a health condition, and lower still for people with multiple health conditions.31 Carers’ participation in work may also be impacted, as they may need to take time away from their jobs to care for ill or injured family members.

If Australians are supported to visit their GP earlier, they will be more likely to receive appropriate preventive care, early diagnosis and early treatment for health conditions. This will improve workforce participation and economic productivity.


Investment in general practice research is needed to improve the healthcare system

General practice research is essential to ensuring all Australians can access a high-quality, effective and evidence-based primary healthcare system. In the five years leading up to 2017, primary healthcare funding comprised only 2–4% of total National Health and Medical Research Council (NHMRC) funding.32 General practice made up an even smaller proportion of this funding.

There is a significant misalignment between where research is conducted and where most Australians access healthcare. GPs and their teams manage the majority of patient health issues, yet most medical research continues to be conducted in the hospital sector.

Inadequate evidence relevant to general practice hinders GPs’ efforts to provide evidence-based care, as guidelines developed from research in other settings may not be appropriate for patients being managed in the community.33,34

The benefits of high-quality general practice are longer term and can be less obvious than results provided short term in a hospital setting. General practice research contributes to an essential evidence-based health system, and can bring benefits to the health system such as lower rates of hospitalisation, as well as improved blood pressure, cholesterol and asthma management. More research is required into these benefits, as well as how general practice can improve the healthcare system more broadly.

A strong primary healthcare research sector linked to general practice–based research networks will increase translation of research findings into practice and ensure Australians can access high-quality, up-to-date, evidence-based care.35

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