2.1
As noted in Chapter 1, the distribution of Australia’s primary care workforce in outer-metropolitan, regional, and rural Australia has been a critical issue for decades. Unsurprisingly, successive governments have attempted to improve the distribution of Australia’s primary care workforce by designing policies and programs aimed at attracting primary care workers to Australia’s rural and regional locations. This chapter discusses the key issues raised regarding the distribution classification systems and the associated policies.
Division of federal and state responsibility for primary health
2.2
As outlined in Chapter 1, under the National Health Reform Agreement (NHRA) 2020-2025, the provision of primary health services in Australia is divided between the Commonwealth, state, and territory governments.
2.3
The committee heard from several inquiry participants that the current division of responsibility between the levels of government does not adequately meet the needs of non-metropolitan areas and that a more collaborative approach is required.
2.4
For example, Mr Richard Anicich AM, Chair, Rural and Remote Services, commented on the need for better cooperation at all levels of government:
The other thing that I think needs to be understood at Commonwealth and state level is that we have to move beyond passing the buck between the state and the federal governments as to who is responsible for what. So often you hear the Commonwealth say, 'We're responsible for primary care,' and the state say, 'We're responsible for tertiary care.' Health care in rural and remote areas doesn't fall neatly into one bucket or the other. So there has to be a complete rethink of that Commonwealth-state funding relationship within the health sector to come up with a more community focused level of care and management of the health issues.
2.5
Professor Richard Murray, Deputy Vice Chancellor, Division of Tropical Health and Medicine, James Cook University, also commented on a lack common goals and accountability between levels of government:
… what we suffer from now is a lack of clear objectives and accountability and a lack of connectedness across programs, particularly federally but also at the state and territory level, with a common objective in mind. I think this might perhaps be an opportunity to get a clearer lead on what some of that realignment might be to focus on actual delivery of outcomes and accountability for that.
2.6
The committee also received evidence from several local councils detailing the lengths they have taken to ensure their communities are provided with access to primary health care, as well as the programs and incentives they have developed to attract and retain health professionals in their communities.
2.7
These policies and incentives range from providing doctors with cash incentives, councils purchasing properties for doctors and their families to live in rent-free, paying the running costs to have medical centres open, and funding other items for general practitioners (GPs) such as vehicles and fuel allowances, utilities, phone bills, furniture, and equipment.
2.8
For example, in the District Council of Kimba (classified as MM6), the council has estimated that is has spent close to $2 million to improve health services in the region. This includes:
upgrading the council owned medical centre (provided free of charge to doctors);
two rent-free houses to doctors willing to relocate to the community;
provision of computers, printers, fax machines, medical equipment and office furniture; and
costs paid for practice accreditation.
2.9
The District Council of Streaky Bay, classified as MM7, also pursued this pathway and purchased the only GP clinic in the area following the retirement of a local doctor. The committee heard that without this intervention the town would have been left without access to a GP. In doing so, the council accrued the following costs:
$438 407 in staff wages, locum accommodation, and running costs;
$79 911 in restructuring and purchase costs;
approximately $100 000 on advertising; and
2.10
Streaky Bay Council also purchased land and built houses for doctors and gave a council car to locums to use during their stay. To partially fund these services, council had to raise the community's rates by one per cent.
2.11
The local councils noted that they are well placed to understand the unique health needs of their communities. However, they expressed concern that it is beyond their scope of authority to fund and provide primary health care services. They further commented that addressing these problems are within the realm federal and state responsibility.
2.12
Responding to questions regarding these concerns, Ms Penny Shakespeare, Deputy Secretary, Health Financing, Department of Health, told the committee:
We can certainly talk about how the Commonwealth tries to influence GPs to work in locations, but, under the health system that we have, general practitioners work in private practice; we don't employ them directly in the Commonwealth government. There are some GPs who are employed directly by state health services to provide primary care health services from hospitals, but I wouldn't describe it as a state government responsibility. Some certainly decide to make that investment through the public health system, but generally we operate with the private sector general practice model. That model is funded primarily by Medicare rebates, which are not direct payments to the doctors; they're patient rebates for services.
2.13
Further, the National Medical Workforce Strategy 2021-2031 (NMWS) recognises that 'understanding the whole picture requires national collaboration – from data sharing and evidence-based modelling to local and jurisdictional level planning.' This means that federal, state and territory governments must work together to improve how they support Australia’s primary care workforce.
Transition to college-led training
2.14
Another component of jurisdictional issues is the training of primary health professionals, particularly GPs. While the Federal Government has responsibility for the education and training of GPs, medical graduates spend their prevocational years training in the state hospital system.
2.15
Historically, the responsibility for training GPs has shifted between the Royal Australian College of General Practitioners (RACGP) and the Department of Health. In 2017, the Minister for Health announced that the responsibility for Commonwealth funded GP training programs, including the Australian General Practice Training (AGPT) program, would transfer from the Department of Health to the RACGP and the Australian College of Rural and Remote Medicine (ACRRM) by 2022.
2.16
The committee has received mixed evidence on the transition to college–led training. There is some consensus that the transition to college–led training is a practical reform, particularly regarding the ability for the colleges to play a greater role in the selection and management of candidates for a GP Fellowship.
2.17
However, several concerns have been raised about the transition, including: the potential impact on the number of students electing to train to be GPs, the impacts on registrars currently undertaking GP training, maintaining and establishing relationships for supervisors and communities, culturally specific training, the focus (or lack thereof) of GP training in regional, rural and remote areas, the closure of successful Regional Training Organisations (RTOs), and the ability for the colleges to successfully manage all aspects of the transition, including staffing requirements.
2.18
Northern Territory General Practice Education (NTGPE) submitted that 'the health needs of the NT are unique, reflecting its demographic, geographic and cultural diversity' and is concerned that the colleges will face challenges in delivering consistent and culturally appropriate training. NTGPE further noted that the transition has the potential to negatively impact health outcomes, particularly for the Aboriginal and Torres Strait Islander population.
2.19
Similarly, Dr Tony Sherbon, Chair of GPEx, which is a currently an RTO said that:
It's not a decision that we quite understand, but nevertheless we are working with the Department of Health and the colleges to progress that decision. We are sorely disappointed in progress. We can't see and we don't feel involved in the process. We've asked for plans and documentation that have not been provided by the colleges. We don't criticise the college or the department, but it is a complex transition process and it is delayed. As you heard from my earlier report, this not only affects the trainees and supervisors but also affects the workforce. If we don't have a smooth transition, we will affect the rural GP workforce, so it's essential that that transition is not only effected in name but is also efficient and that trainees experience a good transition process.
2.20
General Practice Training Tasmania (GPTT) believe that the transition should be paused due to the COVID-19 pandemic. GPTT expressed concerned that proceeding with the current transition timetable will damage the GP training program and reduce the number of candidates.
2.21
Similarly, Associate Professor Catrina Felton-Busch, Director, Murtupuni Centre for Rural and Remote Health, James Cook University, told the committee:
We want to point out that the current RTO AGPT delivery system works. Our concern is that there appears to been no clear reason for this major structural reform, and without this there can be no clear way of determining its success in creating a better system. The transition process highlights to us that there is no clear understanding within either the department or the colleges about what RTOs have been doing for the past 20 years. We're also concerned that there is no avenue to transfer our insights, knowledge and experience to the new system. When RTOs have raised concerns about potential problems, we've been accused of obstructing the transition. Our involvement in the transition process has been restricted to a bureaucratic level in answering questions on forms. We have one RTO representative who has observer status on the transition committee, and that observer is not allowed to speak.
2.22
The Department of Health (the Department) told the committee that transition agreements have been negotiated with the RTOs and that the RTOs are due to submit their transition outplans by 31 March 2022, which will finalise the handover of operations of the AGPT to the RACGP and ACRRM and the grant agreements with the Department. It also noted that the transition has already been deferred by one year.
Geographic classification systems
2.23
As discussed in Chapter 1, the Department of Health uses the Modified Monash Model (MMM) to classify areas on a scale from metropolitan (MM1) to very remote (MM7) and aims to distribute GPs to areas of need through the Distribution Priority Area (DPA) system. This section will discuss the issues raised regarding these two systems.
Modified Monash Model
2.24
Inquiry participants were broadly supportive of the use of the MMM, however, concerns were raised that the model continues to be a blunt tool and fails to adequately distinguish and understand local needs, community disadvantage and the real time availability of primary care services.
2.25
For example, Dr Iannuzzi said:
… I think it's a fairer ranking of the towns … I personally would still like to see the smaller inland centres ranked even higher because we are consistently finding that those towns are struggling the most... it's a no‑brainer where doctors chasing those incentives are going to go, because you can be one or two hours from Newcastle and a couple of hours from Sydney, as opposed to four or five hours from Newcastle and six hours from Sydney.
2.26
Others noted that there is an opportunity to further improve the MMM by recognising the unique circumstance of towns.
2.27
An example of how the MMM could achieve this was provided by Associate Professor Martin Jones, Department of Rural Health, University of South Australia. Professor Jones discussed how research on social and economic disadvantage should be used alongside the MMM system to better support individual community health care needs:
The thing about modified Monash is that it's a measure of location according to geographical remoteness and population size, but alongside that we can use something called [Socio-Economic Indexes for Areas] SEIFA, which in effect is a measure of social and economic disadvantage. We can actually work out, through sophisticated linking with other data sources such as [AHPRA].
2.28
Similarly, the committee was provided with examples from submitters and witnesses who did not agree with their regions' classification under the MMM. The Northern Territory Government noted a disparity in Darwin's classification as MM2 when compared to other MM2 locations with closer proximity to a metropolitan city.
2.29
The Western Australian Department of Health said that they were concerned that communities in Western Australia had been given the same classification as other towns in different states, despite these communities being more remote and experiencing greater disadvantage. They noted that Wyndham is classified as 'very remote' and is 3126 km from Perth and 943 km from Darwin, whereas towns such as White Hills in New South Wales is also classified as 'very remote' and are closer to regional centres and capital cities. White Hills is 1051 km from Sydney and 287 km from Broken Hill.
2.30
The Department of Health notes that the MMM is a 'geographic and data‑based classification system' that does not have any discretionary elements that enables the Department to change a locations' MMM classification. The categories are, however, updated after every Australian Bureau of Statistics Census, therefore every five years. The last update occurred in 2019, incorporating 2016 Census data.
2.31
In the 2022-23 Budget, the Government announced that there will be a review of the MMM and an update to the GP catchment boundaries.
Distribution Priority Area
2.32
The DPA system is used to distribute GPs to areas where there is a shortage of GP services. If an area is deemed a DPA, employers have access to a broader employment pool of doctors, as certain cohorts of GPs, such as overseas trained doctors and bonded medical students, are restricted to practice in DPA locations.
2.33
The committee heard several concerns regarding the current DPA processes. First, the DPA was criticised as a blunt tool that does not appropriately recognise local demographics. Second, the committee heard concerns about the interaction between the MMM and the DPA, and the flow-on effects from changes to a region’s MMM status.
Demographic challenges with the DPA
2.34
Several submitters told the committee that the DPA does not consider key indicators that a community may be experiencing a GP shortage. For example, practices experiencing an increased demand for services, GPs with 'closed books' and not taking new patients, and community members that travel to other areas to seek help for their medical needs.
2.35
Many inquiry participants wrote to the committee outlining the reasons as to why their region should be classified as a DPA and calling for an exemption to allow them to recruit from a bigger pool of candidates, such as bonded medical students and international medical graduates.
2.36
For example, Shoalhaven Family Medical Centers shared:
We believe that there are significant issues with how DPA catchment areas are currently classified. There is a total lack of transparency in the whole process. DPA is calculated by comparing the actual level of GP services provided to a GP catchment with the level of services the same community should receive if they were receiving benchmark level GP Services. Has anyone in the DOH thought that perhaps the benchmark has been set incorrectly or that the whole algorithm used to decide our fate is broken and collecting bad data giving bad decisions.
2.37
In September 2021, the Department of Health introduced an exceptional circumstances review process that enables practices to apply to have their catchment’s DPA status changed.
2.38
The committee heard from numerous inquiry participants that they were losing GPs due to a change in their DPA status and subsequently experiencing a shortage of doctors and recruitment difficulties. They further told the committee that they were still awaiting an outcome from their exceptional circumstances review.
2.39
Since the introduction of the DPA exceptional circumstances review process, the number of outer–metropolitan MM1 catchments classified as a DPA location has increased.
2.40
The Department of Health notes that there is a backlog of applications waiting to be assessed. As at 7 March 2022, the Distribution Working Group had received over 160 applications from practices across more than 80 catchments. Of these, 30 have been granted DPA status.
2.41
As at 29 March 2022, the Department of Health notes that there are currently more than 50 GP catchment areas under review.
DPA reliance on MMM
2.42
As noted above, the DPA and MMM systems work together. For example, inner-metropolitan MM1 areas are immediately classified as non-DPA.
2.43
In relation to how the MMM works in conjunction with the DPA, the Western Australian Department of Health submitted that localities such as Mandurah and Pinjarra are considered areas outside of Perth’s border. However, these locations had their MM classification changed from a regional centre (MM2) to a metropolitan area (MM1) resulting in overseas trained doctors not being able to work in these areas, as MM1 areas are automatically deemed non-DPA.
2.44
Moreover, outer-metropolitan communities reported to the committee that their non-DPA classification has caused a shortage of GPs, as existing medical practices are unable to service these growing populations and face challenges attracting GPs. Mr Andrew Cohen, Chief Executive Officer, ForHealth, commented on the effect of losing DPA in low socioeconomic areas:
There is greater need in many of the lowest socioeconomic areas in outer metropolitan cities with mass populations. These areas were previously part of the DPA system, which was previously [District of Workforce Shortage]. That allowed them to take international doctors, but they've been systematically removed from the DPA system, really, since 2017. The result in these locations is acute shortages and losses of GPs, a 30 per cent drop in after-hours services, extreme wait times in our centres—often of three to four hours—and very distressed local emergency departments, where the number of category four and five cases is growing literally 30 to 40 per cent year on year.
2.45
This issue was also raised by Aboriginal Community Controlled Health Organisations (ACCHOs) in New South Wales where outer-metropolitan locations have been reclassified as MM1 and immediately lost their DPA status as a result. For example, the Aboriginal Health and Medical Research Council NSW submitted that the current DPA classification system ignores the socioeconomic disadvantage where outer-metropolitan ACCHOs operate, and as a result, these areas are experiencing significant workforce shortages.
2.46
Several inquiry participants also raised concerns regarding the 'blanket' nature of DPA status. This refers to areas being either DPA or non-DPA and issues around how this system can effectively balance GPs between outer‑metropolitan, regional, and rural locations.
2.47
For example, the majority of South Australia is MM5–7 and automatically a DPA. This means that areas experiencing a critical GP shortage are hidden within a singular, far too broad classification.
2.48
Similarly, Chinchilla, a small rural community (MM4) in Queensland, has a population of just under 6000 people. It is serviced by two pharmacies, one general practice, a hospital, and a visiting Indigenous health service (3 days each month). The medical practice does not bulk-bill, and currently has five doctors. The hospital has an emergency department which has 1.2 FTE doctors. Despite being in a DPA, Chinchilla Community Centre reported that recruitment of a GP can take over 12 months.
Policies aimed at improving the distribution of the primary health workforce
2.49
The Department of Health has stated that its goal is to better distribute the primary health care workforce. It has a range of policies designed to support, attract, and retain primary health professionals in outer-metropolitan, regional, rural, and remote areas. These policies are often linked to the geographic classification and incentive payments that increase with levels of remoteness.
2.50
Dr Brendan Murphy, Secretary, Department of Health acknowledged the challenges of achieving this goal:
To achieve maximum benefit to the community, the medical workforce must be geographically well distributed and have the appropriate mix of medical specialties in each location. Currently this optimal distribution and service mix is not consistently achieved across Australia, resulting in service gaps and inefficiencies, and potentially impacting on the quality of patient care and the working life of Australia’s doctors.
2.51
As noted in Chapter 1, the National Medical Workforce Strategy 2021–2031 (NMWS) acknowledges that the 'optimal' service mix is not consistently achieved across Australia. Furthermore, the NMWS does not define what the optimal distribution of Australia's medical workforce will look like nor does it set how this would be achieved. Several inquiry participants raised that the doctor numbers used by government does not reflect what frontline workers are experiencing.
2.52
The following section discusses several core concerns raised regarding specific efforts to improve the composition and distribution of primary health professionals.
Stronger Rural Health Strategy
2.53
Inquiry participants supported the objectives of the Stronger Rural Health Strategy (SRHS); however, they raised several concerns including: a lack of consistency across programs, incentive payments being too low and not appropriately targeted to health practitioners, barriers to accessing the programs, a lack of awareness of the various incentives, and the effectiveness of the programs.
2.54
For example, the District Council of Kimba highlighted:
Initiatives proposed in the Stronger Rural Health Strategy somewhat fails to meet the mark given smaller communities inability to provide the supervision some of these initiatives require. A number of these mechanisms are also long-term solutions which do not address the current and urgent needs of communities such as Kimba.
2.55
The committee heard that the SRHS does not address maldistribution issues and the incentives offered are insufficient to encourage GPs into areas of greatest need.
2.56
Submitters also noted that there is a gap in the SRHS in terms of other incentives, such as access to quality housing, that have an influence on the decision for primary health practitioners to move to regional, rural and remote areas. These concerns are discussed in greater detail in Chapter 3.
2.57
The Department of Health has acknowledged the difficulty with assessing and evaluating the impact of workforce programs and initiatives. The Department's Workforce Division looked at a range of statistics and found:
The incentives and policies to increase rural and remote work by GPs have not led to equitable provision of services across the country. It could be concluded that these incentives are ineffective, but it is likely that the maldistribution would be much worse if these policies were not in place. Work is needed on what other policies and quantum of incentives could redress the current imbalance.
Location restricted practice
2.58
A primary policy lever to influence the supply and distribution of primary health care professionals is to restrict where some doctors can practice. The aim being to encourage these practitioners to relocate to outer-metropolitan, regional, and rural areas.
International medical graduates
2.59
International medical graduates are subject to a 'ten-year moratorium' under Section 19(2) of the Health Insurance Act 1973. These doctors must work in a DPA to provide services eligible for Medicare rebates.
2.60
Several submitters raised concerns about Australia's ongoing reliance on overseas trained doctors to fill workforce shortages, particularly in rural and remote areas. The committee also heard that the current use of international medical graduates is considered a short-term and unstainable solution, with overseas trained doctors often moving away from these areas once their service obligations have finished, and this contributes to perpetual workforce shortages.
2.61
The committee also heard that those international medical graduates and overseas trained doctors face barriers in moving to rural areas due to lengthy and overly complex approval processes. This included the requirements for specific programs such as the Visas for GPs programs, where in order to recruit international medical graduates, employers must obtain a Health Workforce Certificate from a Rural Workforce Agency.
2.62
Several inquiry participants raised concerns about the registration process and the overly complicated supervision requirements as barriers to being able to hire these doctors to fill shortages.
2.63
For example, Ms Liz Hunter, Chief Executive Officer, Westgate Health Co‑operative, told the committee that:
We know of at least—I could name them—two international GPs who are sitting at home right now who would come and work with us in a heartbeat, but they cannot get through the maze of the system. They just can't get through…two great female GPs sitting at home not working at all in Melbourne right now.
2.64
Dr Gerard Quigley told the committee that recruiting from overseas was the only option for Lower Eyre Family Practice. Moreover, the recruitment process took three years to complete from when the doctor saw the advertisement to them landing in Australia.
2.65
The committee also heard from several international medical graduates and overseas trained doctors regarding their views on the ten-year moratorium. For example, Dr Shamila Beattie spoke of her experience:
I can tell you that, if you're coming from the [United Kingdom] in particular, going rural is scary. It is not something that a lot of [United Kingdom] GPs feel comfortable with, because we're not used to that environment. We were never trained in that environment. There may be a few exceptions, but most places in the UK are not anywhere near the rural environment. There are always people around. There are always services around. Working in the bush, being so remote and cut off from other medical facilities, was never something I would have considered.
2.66
In contrast, Mr Mark Burdack, Chief Executive Officer, Rural and Remote Medical Services, told the committee of what motivated a trained doctor to stay and remain in a remote town (MM6):
I've got this wonderful doctor on staff. He's absolutely fantastic. He used to work over in Bourke. He is a fantastic doctor. I went up to him one day—it was in the middle of the drought, and we were standing there looking at a river without any water running through it—and I said, 'Why on earth are you here?' He'd been there for four years and he wanted to stay for a very long time. And I said: 'What's your driver? I need to understand this.' He said, 'Mark, when I came to Australia, I went to the cities and I was looking up all the time. It was so alien to me, because I came from a village in Egypt where I had arid landscapes, where it was hot,' and there he was. He felt comfortable; he was welcomed in that community in a way that you wouldn't get in a metropolitan area, because they genuinely wanted his services and he responded in kind by providing very high-quality care.
2.67
It was emphasised to the committee that these doctors play an important role in the provision of services in communities and it is important to ensure that when these doctors are recruited to rural areas they are supported and feel comfortable in the rural environment.
2.68
Professor Gary Rogers, Dean, School of Medicine, Deakin University spoke of how international medical students studying in Australia are more likely to work in rural areas than domestic medical students, but that international students are precluded from participating in Commonwealth funded programs such as the Rural Health Multidisciplinary Training program which is specifically designed to provide opportunities for medical students to train in rural locations.
2.69
The NMWS acknowledges the benefits of self-sufficiency, and the challenge of a continued reliance on international medical graduates, particularly during a pandemic or mass health emergency. The NMWS has developed a goal for Australia to have a domestic medical workforce that is of sufficient size and capability to meet the needs of all Australian communities. However, it is important to note that it is not clear how many GPs are required to ensure national self-sufficiency.
Bonded medical programs
2.70
As mentioned in Chapter 1, bonded medical programs provide students with a Commonwealth Supported Place at an Australian university in return for a commitment to work in eligible regional, rural, and remote areas (known as the Return of Service Obligation).
2.71
The committee received evidence that bonded medical programs were ineffective, have low participation rates, and are associated with lower retention after the period of service.
2.72
Inquiry participants also suggested that those who sign up to bonded medical programs do not intend to practice rurally and use it as a mechanism to secure a position in medical school. For example, Rural and Remote Services submitted that:
We have funded more Bonded Medical Places (BMP) despite an independent report finding that for many BMP recipients view the program as a "low cost or interest free loan that can relatively easily be repaid once fully qualified" without a requirement to engage in the return of service obligation in a rural or remote town.
2.73
Similarly, Dr Hamish Meldrum, Co-founder, Ochre Health, said:
… but I've asked rurally bonded students questions like: 'What made you want to go rural?' and they kind of don't even understand the question. I have to repeat myself a couple of times. Then they laugh at me and say: 'No. Nobody wants to go rural. We just put down that we want to be rurally bonded students so that we can get into medical school.' They think the question I asked them is quite hilarious: 'Why do you want to go rural?’
2.74
Reviews have been conducted into the two legacy bonded medical programs (the Medical Rural Bonded Scholarship Scheme and the Bonded Medical Places). The 2013 review of Australian government health workforce programs (Mason Review) examined both schemes in depth. It found that there was a lack of evidence that the Medical Rural Bonded Scholarship Scheme resulted in longer term positive connections to rural life and provided 'questionable utility' for a program that was expensive and administratively burdensome.
2.75
For the Bonded Medical Places scheme, the Mason Review found that as of February 2013 only one participant had commenced their return of service obligation and three participants have bought out of the scheme. It also noted that the 'Department [of Health] was not currently able to adequately monitor and report on completion of [return to service obligation] requirements while graduates are undertaking vocational training'.
2.76
A separate report conducted by KPMG in 2020 raised concerns about bonded medical programs and the quality of the data surrounding these programs. This report found that in 2017, less than one per cent of the 9976 rurally bonded students had completed their return of service obligations. Additionally, five per cent of participants had either withdrawn, breached or terminated their programs, or had deceased.
2.77
This report notes that due to the issues with the current data and studies '…little can be ascertained in terms of effectiveness for such strategies' and recommended that 'focus should be placed on selecting the student who chooses to participate in rural training as opposed to bonded pathway approaches which have demonstrated limited effectiveness on retention.'
2.78
Further, the committee heard that there is frustration for medical practices as there is no long-term commitment when engaging a bonded student. Submitters also noted that employers are unaware of individuals on bonded programs, and they cannot directly contact bonded doctors for recruitment.
2.79
The Department of Health noted that in total (including the new Bonded Medical Program), there have been 13 521 participants, 597 participants or 4.4 per cent have completed their return-of-service obligations and 779 participants (5.7 per cent) have withdrawn from the program. There are 12 145 remaining active participants and of those 6904 (56.8 per cent) are still studying.
Medicare rebate freeze
2.80
Another factor contributing to a decline in GPs is the Medicare rebate 'freeze'. The Commonwealth Government provides most of the income for general practitioners through Medicare as a fee for service payment via the Medicare Benefits Schedule (MBS).
2.81
A 'freeze' on increases to Medicare rebates was first introduced in the 2013‑14 Budget. The freeze meant that Medicare rebates did not increase annually at an indexed rate between 2013 and 2017, which effectively resulted in GPs not receiving a pay increase for their services. The Government committed in the 2017–18 budget to a 'phased re-introduction of indexation of MBS rebates.'
2.82
Inquiry participants argued that while the costs to provide general practice care increase year on year, successive governments have not matched these increases in patient rebates. Several submitters noted the growing gap between the cost of providing care and the Medicare rebate has had a significant impact on general practice sustainability.
2.83
The RACGP reports the 'cumulative value of lost indexation for general practice MBS rebates is estimated to be over $1.5 billion and growing.'
2.84
Inquiry participants noted the Medicare rebate 'freeze' impacted on the viability of their practices and resulted in GPs not being appropriately remunerated for their time and expertise. Further that these current conditions act as a deterrent to those wanting to enter the profession and contributed to the view that general practice is not a valued career.
2.85
An example of issues around the suitability of Medicare rebates that GPs access, was provided by Dr Jerome Muir Wilson, General Practitioner, Launceston Medical Centre:
For a 19-minute consult with me, you get paid $39. For a 19-minute consult with a kidney specialist, Medicare pays $110 for their first appointment. So we're already behind. I think it's got to come back to the fundamental Medicare schedule. Ninety per cent of what we do is a level 3. That could go up and go up incrementally with rural areas. If we're oversubscribed in the capital cities, that could stay where it is, but we could heavily go up in the rural areas. That's the one thing that I think we need to do. It's not just unfreezing for seven years or five years or going up by [Consumer Price Index]. It's a substantial increase.
2.86
Witnesses told the committee that the Australian Medical Association (AMA) provides suggested fees for services and that the Medicare rebate has failed to keep up with the expectations of the medical community and stated that general practitioners should charge over $80 for a standard level B consult, whereas the Medicare rebate is $39.10.
2.87
Submitters and witnesses suggested that the Medicare rebates would need to be doubled or tripled to have any substantial impact on GP income. It was also suggested that if pay rates were to be used as a recruitment strategy, an 80 per cent increase in GP income would be required.
2.88
Submitters also commented on the Rural Bulk Billing Incentive (rBBi) which provides an increased level of Medicare funding in line with the increased level of remoteness according to MMM category and is designed to incentivise practitioners to work in MM2–7 locations.
2.89
The committee received evidence that the rBBi is not adequate to cover practice costs. As explained by Dr Aniello Iannuzzi:
… It sounds really great when you say '190 per cent' or '160 per cent', but we're talking about 190 per cent of $6—big whoop! That's not going to make any difference at all to running a business—sorry. If you were going to apply that 190 per cent to the $39 rebate, maybe we would be getting somewhere.
2.90
The Department of Health said that the scaling of the rBBi is designed to better recognise the higher costs, smaller patient populations, increased complexity in patient care and the greater burden of responsibility that rural and remote doctors face in those communities.
2.91
In discussing the current Medicare rebate statistics and the issue of GP income generally, Ms Penny Shakespeare, Deputy Secretary, Health Financing, Department of Health, said:
… Medicare statistics at a global level show increasing government investment in GP non-referred attendances. There has been a five per cent increase in benefits paid for GP services just in the last year. Tax office data shows that GPs are routinely amongst the top 10 occupations by average taxable income. There don't seem to be too many indicators that GPs are not able to derive income from Medicare.
2.92
Despite the view of the Department of Health, the committee heard that the Medicare rebates are still too low, even with the resumption of indexation. Inquiry participants told the committee that many practices are closing due to financial pressures.
Committee view
2.93
The committee recognises that the distribution of primary health professionals throughout Australia is a long standing and complex issue; however, it is not appropriate that Australians living in outer-metropolitan, regional, and rural areas are suffering the consequences of this maldistribution.
2.94
The committee supports the Government's objective to improve the distribution of the primary health workforce beyond metropolitan areas and notes that a significant amount of funding provided, and the programs have been developed to address maldistribution. However, the committee is concerned that these policies are failing to assist communities with an immediate need for primary health care workers.
Division of responsibility
2.95
The committee recognises that the responsibility for health care is multi‑jurisdictional. However, it is clear to the committee that the current division between federal, state and territory governments is failing to recognise and meet the needs of communities. Inquiry participants noted that neither the federal or the state governments have taken proper responsibility for the provision of GPs and other primary health professionals.
2.96
The committee was overwhelmed by the evidence received from local councils about the work they are undertaking to ensure their communities have access to basic health services. It commends these councils for their dedication and tireless work to improve the health outcomes of their communities.
2.97
The committee is gravely concerned that local councils have been left to fill the gaps caused by a lack of federal and state responsibility to provide primary health services. Local councils should not have to fundraise or impose rate increases on their communities to support these services.
2.98
The committee recommends that the Federal Government further investigates the provision and distribution of general practitioners in rural and regional Australia.
Classification systems
2.99
The committee notes that the MMM is broadly supported by inquiry participants and that the work of the Department of Health in developing the DPA system is a step in the right direction to better distribute GPs to non‑metropolitan areas.
2.100
Although the committee notes that the DPA calculation takes into consideration the gender and age demographics, and the socio-economic status of patients living in an area, the committee remains concerned that the models are a blunt instrument. The committee is of the preliminary view that these systems require more sophisticated elements to determine a region's level of need.
2.101
The committee notes that in the 2022-23 Budget, the Government announced that there will be a review of the MMM. The committee recommends that this review take into consideration other demographic factors and that the review is open to the public for consultation.
2.102
The committee recommends that the Government’s review of the Modified Monash Model is open to public consultation, including from communities themselves, and is progressed as a matter of priority.
2.103
The committee acknowledges the development of the exceptional circumstances review process for DPA status determinations; however, the committee highlights that this process was only established in September 2021 despite many communities seeking access to location restricted medical practitioners prior to this time.
2.104
Further, it is concerning that there is a significant backlog of applications that have yet to be assessed. As the outcomes of these reviews will determine if communities can recruit GPs from a greater pool of applicants to fill critical workforce shortages it is imperative that the Department of Health and the Distribution Working Group clear the backlog of applications.
2.105
The committee recommends that the Department of Health and the Distribution Working Group assess the outstanding exceptional circumstances review applications as a matter of priority.
The transition to college-led training
2.106
The committee supports the rationale for the transition to college-led training; however, it is concerned that there has been a lack of communication between the Department of Health, RACGP, ACRRM and the RTOs. The committee shares the concerns of inquiry participants that successful RTOs will close, and that knowledge of unique educational and training needs of regional, rural and remote communities will be lost.
2.107
The committee highlights the risk that if the transition is poorly managed this could have the potential for less medical graduates to pursue a career as a GP.
2.108
The committee is greatly concerned that the transition is not being appropriately communicated to key stakeholders and is at risk of being mismanaged. It is vital that the Department of Health clarify what is happening with the transition.
2.109
The committee recognises that there is an advisory committee for the transition to college-led training, however, it is deeply concerned to hear that the RTOs do not feel involved in the process and that their views are not being heard. The committee urges the Department of Health to listen to the concerns of RTOs and fully engage with the RTOs to ensure a smooth transition occurs.
Policy effectiveness
2.110
The committee is also concerned about the effectiveness of the Government’s current programs, including those under the Stronger Rural Health Strategy.
2.111
The committee is troubled that there appears to be no standardised national benchmarks for the 'optimal' level of distribution of primary health professionals. It is unclear how the success of programs can be measured without clear benchmarks. These benchmarks should take into account an area's socioeconomic status, alongside other demographic factors.
2.112
The committee recommends that the Department of Health develops benchmarks for the optimal distribution of primary health professionals.
2.113
The committee also observes that the programs under the SRHS appeared siloed and fail to work with one another. While reviews of programs within the strategy have been conducted, a review of the whole strategy has not occurred.
2.114
The committee recommends that the Department of Health conducts a comprehensive and wholistic review of the Stronger Rural Health Strategy and that performance benchmarks be established to assess the effectiveness of the overall strategy and of its programs.
Location restricted practice
2.115
The committee is concerned about the use of international medical graduates and bonded medical students as a mechanism to fill workforce shortages in non-metropolitan areas. The committee echoes the views of inquiry participants that this is a short-term solution to a long-term problem.
2.116
The committee recognises the crucial work of international medical graduates in providing health services to Australians. However, the committee is worried about successive governments' ongoing reliance on international medical graduates to fill shortages in non-metropolitan areas. The committee considers having an agreed definition of national self-sufficiency will be a key part of any plan to transition away from a reliance on international medical graduates.
2.117
The committee also received overwhelming evidence which showed that bonded medical programs do not achieve their purported goals and that only a small proportion of bonded medical graduates complete their return of service obligation.
2.118
The committee is of the preliminary view that bonded medical programs are ineffective and should cease taking new applicants.
Medicare rebate freeze
2.119
The committee is deeply concerned to hear the current wage structure and renumeration for GPs does not recognise their skill and expertise, nor provide appropriate renumeration for their services.
2.120
The committee considers the current rate of Medicare as a disincentive for those considering a career as a GP.
2.121
The committee notes that the Government’s decision to now allow for indexation on Medicare rebates will not address the now deeply entrenched financial problems facing providers of primary health services. The issues related to the viability of practices appear to be exacerbated in non‑metropolitan areas.
2.122
The committee supports the use of location-based incentive payments, such as the rBBi, as recognition that GPs operating in non-metropolitan areas experience difficulties in service viability due to the small population size in these communities. However, the scaled rates do not appropriately compensate existing regional, rural and remote GPs nor encourage GPs to move to and practice in these areas.
2.123
The committee recommends that the Federal Government investigates substantially increasing the Medicare rebates for all levels of general practice consultations, as well as other general practice funding options.