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Chapter 3: Funding Australian general practice care

The COVID-19 pandemic has exposed limitations of the Medicare fee-for-service model and the need for change in funding models. General practices are private businesses operating with small profit margins. Many suffered severely with the drop in patient consultations early in the pandemic, having to reduce staff to survive (refer to section 5.1.2 ).

Reports from successive governments have called for reform in the ways primary healthcare is funded, to improve the long-term sustainability and agility of the sector. From the 2009 National Health and Hospitals Reform Commission, to the 2015 Primary Healthcare Advisory Group, medical experts and policymakers have called for voluntary patient enrolment with a ‘healthcare home’ to coordinate access to multidisciplinary care.

Experts recommend a range of funding models (not all supported by the RACGP) comprising mixed fee-for-service, grants to support multidisciplinary clinical services and care coordination, outcome payments to reward good performance, and episodic or bundled payments.44,45

The pandemic is an opportunity for innovation, and is a prompt for long-overdue health funding reform. The RACGP’s Vision for general practice and a sustainable healthcare system outlines the urgent need to restructure the healthcare system into one that provides the right care for patients at the right time and in the right place, and that is sustainably funded into the future.

  • 44. National Health and Hospitals Reform Commission. A healthier future for all Australians – final report. Canberra: NHHRC, 2009
  • 45. Department of Health. Primary Health Care Advisory Group Report: Better outcomes for people with chronic and complex health conditions. Canberra: DoH, 2015.

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