The bulk-billing boost should be the start of something bigger

The package, which was quickly matched by the Opposition, includes $7.9 billion over four years to promote bulk-billing. Bonus payments for bulk-billing will expand from children and concession card holders to all patients. The government will pay clinics 12.5% more if they bulk bill all their services. And hundreds more GPs will be trained each year.

These major investments should increase bulk-billing, which has fallen sharply since the pre-pandemic high of 86% in 2019. Last year, only 78% of GP services were bulk-billed, and it was much less for people without concession cards.

Taking action on GP fees is an important step, because a growing number of people are skipping or delaying care due to cost. In 2023-24, it was 1.5 million people – a million more than just five years earlier.

But this spending won’t fix primary care’s underlying problems. Whoever wins the imminent election — whether Labor or the Coalition, majority or minority — should build on this announcement with broader primary care reform.

Australia’s health challenges have changed a lot since Medicare was introduced half a century ago. As our population ages, most of our illness now comes from ongoing chronic conditions, rather than one-off illnesses or injuries. Six in every 10 Australians now have a chronic disease, such as cardiovascular disease, diabetes, or dementia.

But our primary care system is stuck in the old world, with fee-for-service payments that are based on GPs’ time, not the complexity of patients’ conditions or their need for ongoing management.

Two things need to change: who provides care, and how they’re paid. That’s what three separate expert reviews ordered by the federal government have found, and what Grattan Institute research has shown.

Most health systems similar to Australia’s use so-called blended funding for primary care. The bulk of a clinic’s funding is for managing on-going care of patients, with extra funding to care for sicker patients with more complex needs. That funding sits alongside a payment for each visit or service.

More flexible funding means practices can deliver care in different ways, including by employing teams of health professionals. Many countries have much bigger, broader general practice teams than we do in Australia, with more nurses, psychologists, pharmacists, and other health workers.

A bigger, broader team means patients can get more advice on how to manage their health, and it frees up GPs to focus on more complex aspects of care.

The new funding didn’t push in those directions. We will see a change in who pays for care, with the government picking up more of the tab and patients less. But we won’t see a change in how care is paid for, or who delivers it.

Almost the entire package was about GPs. A postgraduate training package for 400 nurses was dwarfed by expansion of GP training that will take trainee numbers well beyond record levels. The new bulk-billing incentives multiply existing fee-for-service payments, entrenching the current model.

While the changes won’t tackle some crucial underlying problems, they do include an important foundation that whoever wins the election should build on.

The new practice payment for bulk-billing clinics introduces some flexibility into the system. It is still based on fee-for-service payment, but is new funding that could potentially be used to employ a broader range of workers.

It should be taken much further. Clinics should be able to choose to receive an even bigger practice payment, adjusted for their patient profile. In return, fee-for-service payments would be lower. In line with the expert reviews that the government has commissioned, those clinics would also get more funding to improve quality of care.

A bigger practice payment could support a broader workforce, more prevention, and more effort on improving care. That way, a big spend to reduce fees could be built into a reform that improves the quality and value of care. That should stop the pain for good.