Is pressure on remote clinics getting worse?

A little more than 1000 people live in the West Australian town of Kalbarri, an area known for its age-old gorges, white-sand beaches and marine life in the waters where the Murchison River meets the Indian Ocean.
 
Recently, however, it has also become noted for what it now lacks, with the town’s only general practice, Kalbarri Doctors Surgery, shutting its doors for good.
 
When it was announced, its owner Christopher Hamilton said they could find ‘no sustainable future’, while GP Dr Tara Hamilton noted the detrimental impact expected from the latest Medicare rebate rise, saying the closure ‘is not just about our clinic’.
 
Such warnings are not only coming from within practices. Health officials are also directly acknowledging the strain on clinics in places like Kalbarri, which sits in Modified Monash Model (MMM) 6.
 
This week the WA health workforce agency, Rural Health West, which is funded by both state and federal governments, said it ‘continues to hear concerns about the financial viability of general practice services across many smaller communities’.
 
Even while noting a growing number of GPs in rural areas, it advised that ‘local governments are increasingly stepping in to provide financial and in-kind support to help maintain access to healthcare services’.
 
In the ongoing Senate inquiry into Medicare access in regional and remote areas, a submission from the Primary Health Network (PHN) Co-operative made more specific observations on the impact of recent Government interventions.
 
‘The most recent Medicare changes, whilst well-intended, have again demonstrated a pattern of metro-centric policy design, insufficient rural stress-testing, and an over-reliance on fee-for-service mechanisms that simply do not work in thin and non-existent markets,’ it wrote.
 
Discussing the $49.8 million thin market funding introduced in the 2023–24 Federal Budget, the PHN Co-operative warns that failing markets ‘are not suitable for these interventions’, with MMM 6 and 7 areas ‘predominantly’ falling into that category.
 
‘MBS alone is not viable for primary care markets in MMM 6 & 7’, the submission states, while also highlighting the reluctance of corporates to get involved in the areas ‘because they are not profitable’.
 
‘These regions need ambitious and sustainable policy and funding reform that is supported by inter-agency co-investment, joint planning and co-commissioning with shared oversight and accountability for outcomes,’ it concludes.
 
A familiar issue
For RACGP Rural Chair Associate Professor Michael Clements, the discussion ‘has certainly been happening for a very long time’.
 
‘In my backyard, the middle swathe of Queensland, there’s no community or privately owned general practices – they’re all owned by Queensland Health because of the inadequacy of Medicare funding,’ he told newsGP.
 
‘In large patches of WA, you’ve got successful practices operating only because the council has stepped in.’
 
He notes the impact if a piece of the primary care puzzle involving different levels of government is not in place.
 
‘If one of those doesn’t come to the party, then the community misses out,’ he said.
 
Associate Professor Clements also sees the recent Medicare rebate rise as something of an inflexion point.
 
‘The Federal Government keeps promoting Medicare as being adequate funding,’ he said.
 
‘And it has deliberately been selling the narrative that Medicare is enough … so the Kalbarri example gives us a raw and real example of why that narrative just simply isn’t true.
 
‘The fact that Medicare only increased by 2.6% – it’s not the magnitude of the increase that really punched rural practice owners in the guts.
 
‘It was the fact that ... at the first opportunity for the Federal Government to show that it believed in general practice and it was going to continue to invest in it and support it, it decided not to increase the rebates by the actual costs of delivering that care.
 
‘It was a clear and unambiguous signal to the GP community that it expected general practices to make do.’
 
Associate Professor Clements is also critical of the signal sent by other recent interventions.
 
‘Within a couple of months of the Federal Government announcing $26 million to create six new bulk billing practices in New South Wales, we’re seeing towns like [Kalbarri] collapse,’ he said.
 
National funding agreements
Recently, the Grattan Institute thinktank has also queried the impact of the tripled bulk-billing incentive in communities that need it most.
 
‘A year after the incentive was tripled in 2023, care in GP deserts actually fell, despite rising almost everywhere else,’ its policy advisors wrote.
 
‘Early data suggest services in GP deserts may have fallen again after the incentive was broadened last year. And after both changes, bulk-billing rates in GP deserts barely shifted.’
 
However, they highlighted a significant shift in the recently signed National Health Reform Agreement, which is better known as the means for setting out Federal funding for state-government-operated hospitals.
 
It notes that this latest document ‘also lays the groundwork for a systematic approach to thin markets for primary care’.
 
The agreement sets out notably more proactive steps to pinpoint areas where general practice services are ‘at risk of closure resulting in limited or no access to primary care’.

To address the same issue, it also commits governments to ‘improved sharing of market intelligence … as soon as practical after December 2026’.
 
The Grattan Institute advisors note how the agreement indicates PHNs, state health departments, and Aboriginal community controlled health organisations can plan and fund care where the market has failed.
 
However, they strike a sceptical tone about the likely effect without tangible funding.
 
‘An independent review of the last five-year national health agreement found that many commitments were never delivered,’ they wrote.
 
A Department of Health, Disability and Ageing (DoHDA) spokesperson confirmed that it, together with Rural Workforce Agencies and PHNs, monitors where general practices may be at risk.
 
They pointed towards the bulk-billing investment scaled in favour of more remote locations, as well as an increase in offers for GP training where ‘at least half’ occurs in regional, rural and remote areas.
 
There have been 131 specialist international medical graduates brought into WA through expedited pathways, it said, while single employer model trials that have worked elsewhere in Australia are scheduled to begin in various locations across the state from August 2026.
 
DoHDA also notes that engagement with workforce agencies and PHNs is at the practice’s discretion, and that the Department may not know about the impending closure.
 
That, however, was not the case in Kalbarri, where the alarm was raised well in advance, and existing, planned or suggested measures failed to move the dial enough to save the general practice.
 
While its state-run health service is still open, it leaves residents uncertain where they will find GP care – with no clear answers offered when the question was raised in Western Australia’s Parliament.
 
As those who tried to keep the clinic afloat prepared to close, newsGP went to the WA Primary Health Alliance, the organisation that coordinates the state’s PHNs, requesting details including measures to address the Kalbarri closure and whether it knew of other clinics that may be at risk.
 
It did not respond.
 
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bulk billing general practice MBS Medicare remote rural generalism