GP funding boost overlooked in Grattan Medicare plan

General practices in Australia would potentially only receive around 8% of funds earmarked for the Strengthening Medicare Taskforce, under reforms proposed by the Grattan Institute.
 
The Melbourne-based thinktank suggests the Federal Government should spend much of the $750 million on bolstering Australia’s primary care workforce numbers – although not GPs – in its ‘strengthening general practice’ report.
 
The proposal would instead see 1000 new nurses, physiotherapists, mental health clinicians, pharmacists, and other allied health workers embedded in general practices in the highest-need communities.
 
As well as pushing for bigger, multidisciplinary general practice teams, the report recommends the introduction of new funding models that would be based 70% on capitation and 30% on fee-for-service.
 
The authors suggest new MBS consultation items be paid at 30% of existing rates.
 
As an incentive for practices to join the new model, the thinktank proposes a funding ‘uplift’ of around 5% of participating practices’ total revenue.
 
The authors estimate this would cost around $8 million in 2024, based on 100 average-sized practices taking part, $15 million in 2025, then up to $39 million in 2026 with costs increasing as more general practices participate.
 
The estimates equate to $62 million over the next three years, which is 8.4% of the $750 million funding dedicated to primary care under the government’s Strengthening Medicare Fund.

Funding under the proposed system would be similar to what they estimate practices currently earn through the MBS, and the authors estimate their reforms could be delivered for a total of $491 million over three years – notably less than the sum put aside by the Federal Government.
 
‘Australia has many GPs, with more on the way,’ the report also states.
 
‘More of the same – more GPs, and more funding under the same model – will not be enough to relieve the pressure on general practices. It will not address the structural mismatch between Australia’s outdated primary care system and the care Australians need.’
 
For RACGP President Dr Nicole Higgins, the Grattan Institute analysis of GP numbers constitutes a ‘disappointingly simplistic take on a very complex problem’ that if not properly addressed will result in compromised patient care.
 
‘Given more GPs expect to retire in 5–10 years and that less than 15% of future doctors are putting general practice as their first preference for a career, there are enormous workforce challenges looming on the horizon,’ she said.
 
‘We can’t stick our heads in the sand and hope a shortage of GPs won’t hurt communities in need, particularly since we have an ageing population and a mental health crisis.
 
‘Australians deserve and need a well-supported and high functioning primary healthcare system. While we acknowledge that investment through the current Medicare structure will not fix all the existing challenges in general practice, it will help to guarantee access for patients until the larger-scale reforms we are advocating for can be implemented.’
 
She also noted concerns about the healthcare sector workforce more broadly.
 
‘There is a shortage of GPs in rural and remote areas which affects our most vulnerable patients and those who’ve already got the shortest lifespans,’ Dr Higgins said.
 
‘We have nurse shortages, we have pharmacists who are in short supply, as well as paramedics, so borrowing from one profession to support another just doesn’t make sense.’
 
In its report, the authors describe Medicare as being in ‘a midlife crisis’, and not designed ‘to respond to the rise of chronic disease, or to tackle gaping disparities in access to care, rates of disease, and life expectancy’.
 
It also said Primary Health Networks (PHNs) should be given ‘real powers’ to put in place the new funding model and roles.
 
While Dr Higgins said the report rightly acknowledges the critical role of general practice and concern with the status quo, she likened the proposed reforms to the way general practice is funded in the UK and worried that they would pose a serious risk to continuity of care.
 
‘The UK system has traded off continuity of care for access,’ she told newsGP.
 
‘The funding didn’t keep up with the need.
 
‘What’s happened in the UK is they’ve demonstrated that the fragmentation and silo-ing of care has increased cost and impacted on care to patients.
 
‘It is something that Australian GPs are hugely concerned about. The recommendation in this report is based on a flawed model.’
 
Dr Higgins also outlined concerns contained in the RACGP’s submission to the Primary Healthcare 10 Year Plan regarding the funding model, which the college says would not allow the flexibility that general practice requires and could exacerbate health inequalities.
 
According to the RACGP President, putting funding towards PHNs is another proposal that is unlikely to benefit GPs.
 
‘That’s just going to add another layer of bureaucracy and red tape to how we deliver care,’ she said.

Dr Nicole Higgins says patient care will be compromised if GP workforce issues are not addressed.
 
Aside from arguing that Australia already has enough GPs, the Grattan report authors also queried the impact of increasing Medicare rebates, an issue that is frequently flagged as the biggest underlying concern by GPs. They wrote that recruiting more GPs and increasing funding ‘won’t solve the deep structural problems Medicare faces’.
 
This take differs strongly from GPs at the coalface, who say an immediate injection of funding is needed to tide the system over until broader reforms can be implemented and ensure patients can still access general practice care. 
 
It also does not appear to account for the ever-widening disparity between stagnating Medicare patient rebates and healthcare inflation, other than referencing steady profit margins that are being propped up by a shift towards mixed billing.
 
In a poll run by newsGP last week looking at a policy proposals in the General Practice Crisis Summit White Paper, most respondents (54%) also said an immediate 20% increase to Medicare rebates would be the most impactful reform on general practice.
 
Despite disagreeing with the approach set out by the Grattan report, the RACGP President says there are areas of common ground with the Institute’s suggestions.
 
‘The report recognises that the vast bulk of primary care services are delivered by GPs, which is in keeping with what RACGP has demonstrated, that nine out of 10 Australians see their family doctor every year,’ she said.
 
‘We do also support multidisciplinary care teams which have good outcomes, but they must be GP-led.’
 
However, Dr Higgins also stressed that both patients and GPs would need to be at the centre of decision-making surrounding any systemic reforms.
 
The Grattan Institute report was presented to the Strengthening Medicare Taskforce last month.
 
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