2017-2018 rural health budget summary


Overall, the health Budget has been generally well received. However, it contains very little that is rural specific.

Some measures will be of benefit to people living in rural and remote Australia, and to service providers – for example, the staged removal of the Medicare freeze. Other non-health-specific measures, such as significant investment in regional infrastructure, will boost economic growth and job opportunities for rural Australia, with consequent flow-on effects in terms of the social determinants of health.

But unfortunately rural health, including Aboriginal and Torres Strait Islander health, gets almost no attention in the Budget and this is a glaring omission.

A long-term commitment is still needed for a national rural and remote health plan that can identify concrete, on-the-ground building blocks, including funding models, to bridge the divide in health outcomes for people living outside the major cities of Australia.

Specific measures

Medicare Benefits freeze

The Government will take an incremental approach to lifting the indexation freeze on Medicare rebates, commencing with bulk-billed incentives for GP consultations from 1 July this year; standard GP consultations and other specialist attendances from 1 July 2018; specialist procedures and allied health from 1 July 2019; and targeted diagnostic imaging services from 1 July 2020.

While it would have been preferable to have the freeze lifted in full immediately, this is a welcome move, which should assist people in rural and remote communities who rely on bulk billing.  However, the continuation of the freeze in other areas until as far away as July 2020 could see other out-of-pocket costs rise, and the freeze continues indefinitely for diagnostic imaging, placing further pressure on out-of-pocket costs.

Health Care Homes

There will be a phased introduction of Health Care Homes, with the model to begin from 1 October 2017 for up to 20 Health Care Homes, and the other 180 to begin from 1 December.  This delay will provide practices with further time to prepare for implementation and will also enable Aboriginal and Torres Strait Islander people enrolled in Health Care Homes to claim Indigenous health assessments through Medicare, in addition to the Health Care Home claiming the bundled payment attached to this initiative.

The Government will also invest $30 million with community pharmacies to incorporate medication management programs within Health Care Homes.

Practice Incentive Program

The Government will proceed with reform of the Practice Incentive Program (PIP) arrangements with introduction of a Quality Improvement PIP (QIPIP).  However, implementation has been delayed by 12 months and will now commence on 1 May 2018.

The Indigenous Health Incentive and Procedural GP Practice Incentive will continue to be paid separately and not collapsed into the new QIPIP.  This is a welcome move and follows public advocacy by the Alliance and the Rural Doctors Association of Australia (RDAA).

To quote RDAA President, Dr Ewen McPhee, "This will mean that only general practices that are actively providing Indigenous healthcare and/or procedural GP services to their communities will continue to have access to the important funding support provided under these specific areas of the PIP.”

Mental health

The Government has committed $80 million over four years for psychosocial support services for people with severe mental illness who are not eligible for support under the National Disability Insurance Scheme (NDIS). This is a very welcome move and addresses a looming problem being encountered in implementation of the NDIS.

Many people with a severe mental illness who have relied on community based psychosocial supports (eg. Day to Day Living, Personal Helpers and Mentors Program, Partners in Recovery) have been in danger of losing these supports as funding from existing programs transitions into the NDIS but they are found to be ineligible for the NDIS.  This funding will be provided outside of the NDIS but will be contingent on matching funding from the states and territories in accordance with the COAG agreement on continuity of support for existing clients.

The Government also re-announced funding of $9.1 million over four years to enable Australians who live in rural and regional Australia to access psychologists via telehealth. This initiative was originally announced on 19 April. While it is a relatively small amount of funding, it is a welcome initiative.

Medical Research Future Fund – Regional Benefits

One of the less publicised initiatives in the Budget was the announcement of the first disbursements of $65.9 million from the Medical Research Future Fund (MRFF). These funds will be provided for eight strategic programs, with a particular focus on regional Australia.

This includes $20 million for preventive health and research translation projects including support for Advanced Health and Research Translation Centres and new Centres for Innovation in Regional Health.

It is understood the locations of the Regional Innovation Centres will be announced in the near future.

The rationale for this focus on regional research includes recognition of the unique challenges faced by rural and remote Australia, and the impact of location on health care access and outcomes.

A brief on this initiative is attached.

Primary Health Networks – After Hours

Funding of $145 million over four years has been confirmed for Primary Health Networks (PHNs) to continue their central role in ensuring local access to after-hours primary health services and maintain continuity of existing services.

PHNs were provided with funding for 2015-16 and 2016-17 to implement innovative and locally tailored after-hours solutions based on community need. Given the success of the after hours initiatives, this funding confirms they will continue to carry out this role.

There will be further changes (and associated savings) to the Health Information, Advice and Counselling Services Network (HIACSN) program (nurse-led telephone triage) and the Primary Health Collaboration and Complex Condition (PHCCC) program. The HIACSN program will continue to provide nurse triage, after-hours general practice, and pregnancy, birth and baby call services. The PHCCC program will be redesigned but will ensure coordinated care will continue for people with complex and chronic conditions.

The impact of these changes will be an area for further follow up by the Alliance.

Primary Health Networks – Palliative Care

The Government is introducing a new program called Greater choice for At Home Palliative Care with funding of $8.3 million over four years. Funds will be made available to a first wave of PHNs (about 10) to provide care coordination and support to people needing palliative care services in their local communities.

This responds to a need to provide support at home for people requiring palliative care, and their families and carers, and has the potential to be of benefit for people in rural Australia who often have to travel away from home for these services.

The future

In his presentation to the Budget lockup (attached), Minister Greg Hunt announced that the second wave of reform would include a focus on strengthening mental health, particularly in rural areas, as well as a workforce strategy which would look at issues of distribution.

The Minister announced that the third wave of reform would include strengthening primary health care through building on the transformative nature of Primary Health Networks, and strengthening preventive care, with particular focus on Indigenous health.




Health Budget at a glance

Fact sheets



Mental health, preventive health and sport

Medical research

Health Minister’s media releases

Guaranteeing Medicare and improving access to medicines for Australians

Guaranteeing vital services for Australia’s world class health system

Budget papers

Health portfolio budget statements 2017-18