Australian Politicians Promise Billions for Healthcare

Medicare, Australia’s national health insurance scheme, is set for its biggest boost in funding since its creation half a century ago, as both major political parties promise billions ahead of this year’s federal election.

The incumbent Labor government, led by Prime Minister Anthony Albanese, announced an AU$8.5 billion (US$5.4 billion) commitment to increase access to free primary healthcare and boost the general practitioner (GP) and nursing workforce. The same day as Labor’s announcement, the opposition Liberal/National Coalition made a similar AU$9 billion commitment.

Either commitment would represent the single biggest investment in Medicare since its inception. As one of the first major announcements of the election cycle, preceding even the announcement of a date for the election, it’s a signal of how critical the issue of healthcare access is perceived to be.

“The government, luckily, has realized that we’re now at a tipping point as to whether this is going to become a sustainable healthcare system or not,” Ginita Oberoi, MD, a GP in Ulverstone, Tasmania, told Medscape Medical News. “This investment is very welcome, and we’re hoping to see that both our governments are talking about this and making this front and center of their campaigns.”

Australia’s Medicare system uses a fee-for-service model, in which healthcare professionals, including GPs, set their own fees for the services they provide, and patients claim rebates from the government for those services.

The rebates vary according to the duration, complexity, and type of consultation. They range from AU$42.85 (US$27.16) for a 6- to 20-minute standard consultation to AU$122.15 (US$77.42) for a 40- to 60-minute consultation.

If the practitioner’s fee is the same as the rebate that the government pays, then the consultation is free. This situation, which is called bulk billing, provides universal primary healthcare. There are also separate financial incentives designed to encourage GPs to bulk-bill certain groups, including patients aged under 16 years, pensioners, and patients receiving government support.

The rebate amount is supposed to increase annually in line with wages and consumer price indices. However, in 2013, the Labor government froze the Medicare rebate, and that freeze remained in place until 2020. Even after it was lifted and the rebate amount was once again indexed each year, it was not increased to compensate for the value lost during the pause.

As a result of that lag and recent cost-of-living increases, an increasing number of GPs have raised their fees to well above the rebate amount, and patients must pay the difference. Bulk-billing rates have declined significantly from a peak of 89% of GP consultations in 2020 to 78% in 2024.

Labor’s aim with the funding boost is to ensure that 90% of all GP consultations are bulk-billed. It hopes to achieve this goal by expanding the bulk-billing incentive to cover all Australians so that every bulk-billed consultation will attract the additional incentive amount. The party has also promised another 12.5% of the rebate on top of that, paid on every consultation in practices where all patients are bulk-billed for every visit.

The idea behind this measure is to give patients some certainty, said Stephen Duckett, PhD, honorary professor at the University of Melbourne, Melbourne. “At the moment, if you walk into a general practice, you don’t know whether you’re going to be bulk-billed or not,” he told Medscape Medical News. “It’s not only about financial barriers to access and more people getting bulk-billed, but it’s also about restoring dignity and certainty to that interaction.”

Labor’s announcement also included funding for 2000 new GP trainees by 2028 and 400 nursing scholarships.

While organizations like The Royal Australian College of General Practitioners, Melbourne, have applauded the scale and intention of the promised funding, they have also questioned why the underlying rebate amounts weren’t increased, arguing that the baseline rebates are still too low to cover the cost of patient care.

“It would be a simple matter for them, if they were genuine…to basically say we’re just going to raise everybody’s rebates to $69 because if we hadn’t frozen the rebate back in 2013 and then ongoing, that would be the corrected rate of the rebate now,” said Imaan Joshi, MD, a specialist GP in Sydney. Instead, the funding is “a carrot with a whole lot of sticks,” Joshi told Medscape Medical News.

That lack of change to the underlying rebates and the bulk-billing bonus could also encourage shorter consultations and higher churn rates, Oberoi said. “This incentivization of bulk billing is going to provide a perverse incentive for doctors to see more patients faster, and that, unfortunately, is not what is matching the disease profile of Australians now,” she said.

Duckett acknowledged that the funding promises, however significant, don’t fix everything. “Cost of living is obviously on everybody’s lips,” he said. “This is one of the best ways the government can address cost-of-living issues in healthcare, so it’s really important in that regard.”

Oberoi, Duckett, and Joshi reported having no relevant financial relationships.

Bianca Nogrady is a freelance health journalist based in Sydney.