Rural health workforce

Budget Review 2018–19 Index

Amanda Biggs

A Stronger Rural Health Strategy

It is widely recognised that people in rural and remote areas of Australia experience poorer health outcomes, lower life expectancy and poorer access to health services than those living in metropolitan areas.[1] To address shortages of health workers in rural and remote areas, the Government has announced A Stronger Rural Health Strategy package and allocated funding of $83.3 million over five years from 2017–18.[2] The Government says the Strategy will deliver around an additional 3,000 specialist general practitioners (GPs) and over 3,000 nurses, as well as hundreds of allied health professionals in rural areas over ten years, for a total investment of $550 million.[3] However, it is not clear from the budget papers what specific measures count towards this total investment figure.

Rural medical workforce

A range of measures for the medical workforce are included in the package.

A Murray-Darling Medical Schools Network supporting end-to-end training for students to study medicine in the regions will be established. The network will involve seven university medical schools (subject to finalisation of contractual arrangements and the universities meeting accreditation requirements).[4] A pool of Commonwealth Supported Places (CSPs) taken from existing medical school allocations will be established. Commencing in 2021, the pool will comprise up to 60 medical CSPs to be allocated by participating universities every three years and redistributed between providers through a competitive process. This will provide flexibility to allow rural health workforce priorities to be more quickly addressed as they emerge. These priorities will be identified through a new health workforce data tool called HeaDS UPP.[5]

Thirty CSPs will be allocated in the first round to a new medical school in Orange. Universities with reduced medical CSPs will be allowed a commensurate increase to their international medical enrolments, as a transitional arrangement. $95.4 million has been earmarked to establish the network. However, no new CSPs will be funded.[6] Legislation is not required; however, the establishment of the network and pool arrangements may need to be specified in the triennial Commonwealth Grants Scheme funding agreements between the participating universities and the Commonwealth.[7]

To enhance training opportunities in rural areas, two new Junior Doctor Training programs will be introduced. The Rural Primary Care Stream will provide educational support for junior doctors to train in rural general practice. The Private Hospital Stream will provide salary support for junior doctors to work in private hospitals. Concurrent to this will be the development by the National Rural Health Commissioner of a National Rural Generalist pathway.[8] Legislation is not required.

New fee arrangements that support medical graduates to pursue additional qualifications as vocationally registered (VR) general practitioners (GPs) will be introduced.[9] Australian trained non-VR doctors who work in Modified Monash Model (MMM)[10] remoteness classification areas 2–7 will be able to claim 80 per cent of the Medicare rebate that is claimable by VR GPs, representing an increase on the Medicare rebate they can currently claim. Support will be offered to existing non-VR GPs to upgrade their qualifications. When a new non-VR GP begins the pathway to full registration (Fellowship) they will be able to claim the full Medicare rebate.[11] It is hoped that supporting non-VR GPs to attain higher qualifications in rural areas will help address the maldistribution of the medical workforce in these areas. Legislation will not be required, as changes to Medicare fees are made through legislative instrument.[12]

At the same time under a separate Home Affairs budget measure, the number of visas for overseas trained doctors (OTDs), who provide a significant proportion of Medicare-funded services in rural areas, will be capped at 2,100 per year from January 2019.[13] Although not detailed in the budget papers, media reports suggest this will result in a decrease of 200 OTDs per year.[14] As the pool of new OTD doctors declines, Medicare expenses in the form of rebates that are paid to them should also fall, resulting in estimated savings of $415.5 million over four years.[15] Savings will be used to fund health policy priorities.[16] Imposing a cap on OTDs does not require legislation.

The geographic eligibility criteria for rural bulk billing incentives will be updated. Incentives are available to doctors in designated rural and remote areas for bulk billing patients under 16 or those holding a Commonwealth concession card. The geographic eligibility criteria that are currently applied are based on out-dated population figures; these will be updated and be based on the MMM remoteness classification areas 2–7.[17] Legislation will not be required as the changes can be achieved through legislative instrument.

Other medical workforce measures include:

  • changing the return of service obligations for medical students under bonded medical training programs by introducing an optional three year bonded period (down from six years)[18] and
  • streamlining GP training arrangements provided through the Royal Australian College of General Practitioners and the Australian College of Rural and Remote Medicine for GPs to gain vocational recognition and providing 100 additional vocational training places through the Australian General Practice Training Program from 1 January 2021.[19]

Nursing and allied health workforce

The package includes a number of measures to support the nursing and allied health workforces, in recognition that rural areas also experience shortages of these health professionals.

A new Workforce Incentive Program will be established from 1 July 2019, which will provide targeted incentives for general practices to employ allied health professionals and targeted incentives for doctors to practise in non-metropolitan areas. Existing GP, nursing and allied health incentive programs will be replaced with the new Workforce Incentive Program. Eligible practices who employ allied health professionals can receive incentive payments up to $125,000 per year, with a rural loading for those in MMM classification areas 3–7. Doctors located in MMM classification areas 3–7 areas may receive a maximum payment of up to $60,000. Around 5,000 practices and more than 7,000 doctors are expected to be eligible for the payments.[20]

The role of nursing in team-based and multidisciplinary primary care service settings will be enhanced through continued funding to the Australian Primary Health Care Nurses Association, which helps nurses to deliver care in primary care settings. An independent review of the nursing curricula and pathways into nursing will be conducted.[21]

Support for Aboriginal and Torres Strait Islander health professional organisations will continue through increasing investment in Aboriginal and Torres Strait Islander Health Professional Organisations of around $1.6 million a year. In addition, a new primary care funding model will be implemented from 1 July 2019, in consultation with the Indigenous health sector.[22]

Stakeholder reaction

Most stakeholders have been generally supportive of the package. The Rural Doctors Association of Australia (RDAA) and the National Rural Health Alliance (NHRA) both welcomed the Strategy. The RDAA described it as ‘a multi-pronged approach to supporting improved medical workforce distribution to rural and remote Australia’.[23] The NHRA welcomed funding ‘to help fill the health workforce gaps’ and described the new Workforce Incentive Program as the ‘first step in increasing very low numbers of allied health workers in rural and remote areas’.[24] The Australian Medical Association (AMA) also welcomed the Strategy.[25]

For several years, there have been calls including from some in the National Party, to establish a Murray Darling Basin Medical School.[26] These calls have faced opposition from some medical groups, including the AMA, who argue that there is an oversupply of medical graduates[27] and the Australian Medical Students Association (AMSA) who argued that increasing the number of medical graduates would mean a higher number missing out on limited internship placements.[28] In announcing the Murray-Darling medical schools network, the Government appears to have addressed some of these concerns by agreeing to not increase the total number of medical CSPs available overall. The AMA described the decision to ‘reject the proposal for a stand-alone Murray Darling Medical School in favour of network’ as ‘a better approach’.[29] The AMSA Rural Health group also expressed ‘cautious optimism’ over the announcement.[30]

In relation to the visa changes for OTDs, Dr Michael Gannon, President of the AMA has reportedly questioned whether the savings will be achievable, as other medical providers will still be available to provide the services no longer provided by OTDs.[31]

[1].         Australian Institute of Health and Welfare (AIHW), ‘Rural & remote Australians: overview’, AIHW website.

[2].         Australian Government, Budget measures: budget paper no. 2: 2018–19, pp. 106–107.

[3].         Department of Health (DoH), ‘Stronger Rural Health Strategy–delivering high quality care’, Budget 2018–19 Fact Sheet, 8 May 2018.

[4].         The universities involved include the University of NSW (Wagga Wagga), University of Sydney (Dubbo), Charles Sturt University/Western Sydney University (Orange), Monash University (Bendigo, Mildura), University of Melbourne/La Trobe University (Shepparton, Bendigo, Wodonga).

[5].         DoH, ‘Stronger Rural Health – Teaching – Train in the regions, stay in the regions’, Budget 2018–19 Fact Sheet, 8 May 2018.

[6].         Ibid.

[7].         Department of Education, ‘Commonwealth Grants Scheme’, website. The agreements are made under the Higher Education Support Act 2003.

[8].         DoH, ‘Stronger Rural Health –Training–improving access to training in rural areas and the private sector through junior doctor training’, Budget 2018–19 Fact Sheet, 8 May 2018.

[9].         VR GPs complete a three year training program that allows them to pursue a career as a specialist general practitioner. Royal Australian College of GPs, ‘Becoming a GP in Australia,’ webpage.

[10].      The Modified Monash Model (MMM) is a new geographical classification system, using up-to-date population data, which the Government is using to address the maldistribution of medical services across Australia. DoH, ‘Modified Monash Model’, webpage. A searchable map of MMM locations is available via this DoctorConnect website.

[11].      DoH, ‘Stronger Rural Health – Training – improved access to Australian trained general practitioners and quality care’, Budget 2018–19 Fact Sheet, 8 May 2018. Currently, rebates for non-VR GPs are considerably lower than for VR GPs.

[12].      Health Insurance (General Medical Services Table) Regulations 2017.

[13].      Budget measures: budget paper no. 2: 2018–19, p. 134.

[14].      ‘Australia to let in fewer overseas doctors, in one of biggest budget savings’, The Guardian (Australia), 8 May 2018; S Parnell, ‘Junior medics’ reason to go bush’, The Australian, 9 May 2018.

[15].      OTDs who work in a District of Workforce Shortage are exempt from the Section 19AB restrictions of the Health Insurance Act 1973, which prohibits OTDs from accessing a Medicare provider number. See Department of Human Services (DHS), ‘Medicare provider number for overseas trained doctors and foreign graduates’, DHS website. The difference between the Medicare rebate for exempt OTDs and the 80% of the fee that non-VR GPs will be able to claim appears to constitute most of the savings.

[16].      Budget measures: budget paper no. 2: 2018–19, p. 134. This measure constitutes the largest saving in this year’s budget. See Australian Government, Budget Overview, p. 36.

[17].      DoH, ‘Stronger Rural Health—Recruitment and retention—supporting rural and remote areas through improved targeting of rural bulk billing incentives’, Budget 2018–19 Fact Sheet, 8 May 2018.

[18].      DoH, ‘Stronger Rural Health —Recruitment and retention—addressing doctor shortages across rural and remote areas by strengthening bonded program ’, Budget 2018–19 Fact Sheet, 8 May 2018.

[19].      DoH, ‘Stronger Rural Health—Training—streamlining general practice training to produce Australian trained general practitioners where they are needed’, Budget 2018–19 Fact Sheet, 8 May 2018. See also, Budget measures: budget paper no. 2: 2018–19, p. 107.

[20].      DoH, ‘Stronger Rural Health—Recruitment and retention—Workforce Incentive Program’, Budget 2018–19 Fact Sheet, 8 May 2018.

[21].      DoH, ‘Stronger Rural Health—Recruitment and retentions—strengthening the role of the nursing workforce’, Budget 2018–19 Fact Sheet, 8 May 2018.

[22].      M McCormack (Deputy Prime Minister) and J McVeigh (Minister for Regional Development, Territories and Local Government), Regional Australia—A stronger economy delivering stronger regions, ministerial budget statement, 2018, p. 92.

[23].      Rural Doctors Association of Australia (RDAA), ‘Budget delivers for rural health’, media release, 8 May 2018.

[24].      National Rural Health Alliance, Rural health budget $$ welcome but not enough, media release, 8 May 2018.

[25].      Australian Medical Association (AMA), ‘AMA welcomes 'Stronger Rural Health Strategy'’, media release, 9 May 2018.

[26].      J Dewar, ‘Regional unis face ‘triple whammy’’, The Australian, 24 May 2017; ‘Regional taxation key to growth’, Central Western Daily, 30 June 2016.

[27].      S Parnell, ‘More doctors not the answer’, The Australian, 4 May 2018.

[28].      Ibid.

[29].      AMA, ‘AMA welcomes 'stronger rural health strategy'’, op. cit.

[30].      AMSA Rural Health, ‘Budget: rural health in focus, media release, 10 May 2018.

[31].      N Evans, ‘Visa saving questioned by doctors’, West Australian, 10 May 2018.


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