Financial strain eases for some practices: Report

Financial strains softened in 2025 – but around a third of general practices in one region still find it challenging to keep up with payments.
 
That is according to a new analysis released by Hunter New England Central Coast Primary Health Network (PHN) in New South Wales, which used data from a viability assessment of 189 practices surveyed in the region from July to October last year.
 
Of those, 7% reported operating at a quarterly financial loss, while 16% said they could not easily afford basic improvements such as replacing a vaccine fridge.
 
However, six in 10 clinics in the PHN reported being confident they could cover such costs, a significant improvement on the 43% found in a 2024 baseline survey.
 
The latest results also indicate a ‘modest improvement’ in retaining staff, and better patient access with 83% of practices having at least one GP with their books open, up from 75% previously.
 
In total, 33% of clinics said they had difficulty keeping up with bills, down from 50% previously.
 
The report, which is based on responses gathered between July and October 2025 before the Government’s flagship tripled bulk-billing incentives came into effect on 1 November, says ‘clear progress has been made’.
 
However, it warns ‘general practices continue to face significant challenges’ with continued investment in workforce, operations, and financial support ‘essential to ensure equitable access’ across the region.
 
The PHN identified workforce retention in particular as ‘a critical challenge’ for general practices.
 
Among the most striking findings in the research, three in 10 practices said they would become financially unstable if a GP or registrar were to take three months’ leave without being replaced – an issue particularly affecting smaller clinics.
 
That figure is healthier than the 60% of respondents who indicated the same in 2024, a result authors say indicates progress ‘but ongoing vulnerability’.
 
While workforce pressures appear to be easing, according to participants, they remain significant, with more than half participating practices (55%) saying the attraction and retention of clinical staff is ‘a major barrier’, down from 74% in 2024.
 
Associate Professor Rashmi Sharma, Chair of the RACGP Expert Committee – Funding and Health System Reform, said it is positive to see the analysis finding a reduction in clinics facing financial stress but ‘a real concern’ that a third still report difficulty keeping up with bills.
 
‘Unfortunately, Medicare rebates still remain insufficient to cover the full cost of providing comprehensive, high-quality specialist GP care,’ she told newsGP.
 
A 40% increase to patient rebates for longer consultations would both support patient access to affordable care and assist with practice viability, Associate Professor Sharma said, particularly for practices seeing more patients with complex health needs.
 
She also would expect to see ‘different challenges in different areas’.
 
‘Rural and regional areas, which this PHN would cover, often experience challenging workforce issues and there needs to be acknowledgement by policy makers that the recruitment and training of staff to ensure high-quality care comes at a cost to the practice,’ she said.
 
The PHN survey found a boost in morale among those surveyed, but said administrative load continued to be a significant burden on general practices.
 
The finding resonates with Associate Professor Sharma, who calls for more investment so IT systems can communicate seamlessly with each other, as well as measures to streamline paperwork to auto-populate clinical software and Medicare reform so administrative workload is properly funded.
 
‘Red tape is placing an unacceptable burden on GPs, pulling us away from delivering the care our patients need and impacting clinicians across the system,’ she said.
 
‘Reducing administrative load must be a priority.
 
‘We need meaningful reform and better funding so GPs can spend time where it matters most – with our patients.’
 
The report also found many practices (69% compared to 85% previously) still rely on the Workforce Incentive Program (WIP) and Practice Incentive Program (PIP) payments – another concern for Associate Professor Sharma.
 
‘The reliance on WIP and PIP for viability is a strong signal to government to carefully consider downstream implications when considering reform in these areas and to consult with the RACGP prior to any proposed changes,’ she said.
 
‘Strategic planning also comes at a cost to practice, but is a vital component of running a practice and again should be recognised as an area of investment by government.’
 
The majority of responses from the PHN survey came from practice managers, with 169 practices completing the survey for the second time and 20 new clinics contributing.
 
The Hunter New England Central Coast PHN said it is working on a range of targeted measures to support practices’ viability.
 
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