Australia’s universal health system in a mid-life crisis, say experts

Australia’s universal healthcare system is no longer fit for purpose and has failed to keep up with changes to health needs since it started four decades ago.

A new Grattan Institute report is calling for an overhaul of the way GPs work and get paid so Australia can turn the tide of chronic disease, keep more people out of hospital, and ensure poorer Australians get the care they need when they need it.

“Australia’s universal healthcare system, Medicare, started in 1984. It was a different time: perms were still in fashion, INXS had their first hit single, and you could still pay for things with a one cent coin. Much has changed in the four decades since, but the government’s approach to general practice – the backbone of our health system – hasn’t kept up,” the report said.

GPs’ work has become much more complex, as the population has grown older and rates of mental ill-health and chronic disease have climbed. While rates of bulk-billing for GP services are high overall, particularly for patients with concession cards, disadvantaged Australians still face barriers and inequity to care.

But the way we structure and fund general practice hasn’t kept up. 

Despite patient care becoming more complex, appointments have been stuck at an average length of 15 minutes for the past two decades. The MBS encourages GPs to see more patients, faster, by paying
more per minute for shorter visits. This promotes a focus on speed over need. GPs are therefore struggling to meet their patients’ needs, and they lack the support of a broader team of health professionals to do so.

Federal Health Minister Mark Butler recently said that “primary care is in its worst shape since Medicare began”.

The discussions at the recent General Practice Crisis Summit affirmed that decades of significant underfunding and cost-cutting has left general practice on the brink of collapse, with high upfront costs affecting vulnerable patients’ access to timely care and future doctors discouraged from pursuing a career in general practice, leading to a growing shortage of GPs.

Other countries have reformed general practice, and their rates of avoidable hospital visits for chronic disease are falling. But Australia is spending more on hospitals while neglecting general practice: the best place to tackle chronic disease.

Patients suffer the consequences. People with chronic disease live shorter lives, with more years of ill-health, and lower earnings. Poorer Australians suffer the most: they are twice as likely to have multiple chronic diseases as wealthy Australians.

Australia’s healthcare workers are also struggling. Hospital staff are overwhelmed with demand. And GPs tell us they are stressed, disrespected, and disillusioned.

“Medicare is in the grip of a mid-life crisis,” said report lead author and Grattan Institute Health and Aged Care Program Director Peter Breadon.

To bring Medicare into the 21^st Century, the report recommends big changes.

First, general practice needs to become a team sport, with many clinicians working under the leadership of a GP to provide more and better care.

To achieve this, the federal government will have to dismantle the regulatory and funding barriers that force GPs to go it alone. To accelerate the change, 1,000 more clinicians, such as nurses and physiotherapists, should be employed in general practices in the communities that need them most.

Second, Australia needs to change the way GPs are paid. The current method is broken – it actively discourages GPs from working with teams, and it rewards GPs who see lots of patients in quick succession, rather than spending more time with patients who need more care.

GPs should be able to choose a new funding model that supports team care and enables them to spend more time on complex cases, by combining appointment fees with a flexible budget for each patient based on their level of need.

“Our fix will give more patients better care, and boost GPs’ job satisfaction – and it’s affordable.

“Reform is overdue, but an opportunity has arrived. The Albanese Government has set aside $250 million a year to fix Medicare. That money can fund the recommendations in this report, repairing the foundation of Australia’s healthcare system and creating a new Medicare that is ready for the decades ahead,” Breadon added.

A copy of the report has been provided to the federal government’s Strengthening Medicare Taskforce, chaired by Health Minister, Mark Butler. The Taskforce was established to recommend changes to health funding to better meet the demands of an ageing population and will report to the government on 13th December.

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