Australia's Bulk Billing Crisis: Why Medicare Is Failing and What Needs to Change
Australia's Medicare system was built on a compact: universal access to a general practitioner, with the Commonwealth covering the cost in full for patients who cannot afford to pay. That compact has been eroding for years, but the period from 2022 to 2024 marked its most visible rupture. The national bulk billing rate for GP attendances — the proportion of consultations billed at the Medicare rebate with no out-of-pocket charge to the patient — fell from approximately 88% in the June quarter of 2022 to roughly 76% by mid-2024, according to the Department of Health and Aged Care's Medicare statistics series. In raw terms, this means that for roughly one in four GP visits, Australians now pay an out-of-pocket gap. For low-income households, those with chronic disease, and those in outer regional and remote areas, the effective rate of access to gap-free primary care is considerably lower than the national average suggests.
This article examines the structural causes of the bulk billing collapse, assesses the adequacy of the Commonwealth's response — including the November 2023 triple incentive payment — and makes the case for a reform agenda proportionate to the scale of the problem.
Why Bulk Billing Is Falling: Structural Causes
Medicare Rebate Indexation Has Failed for Decades
The central cause of the bulk billing crisis is not mysterious. Medicare rebates for GP services have been indexed against a formula — the Health Insurance (General Medical Services Table) indexation mechanism — that has systematically lagged behind the actual costs of running a general practice. From 1996 to 2013, GP rebates were effectively frozen in real terms, tracking CPI at best and often falling below it. A two-year indexation freeze imposed in the 2014 federal budget (which ran until 2017) compounded the damage.
By the mid-2010s, the gap between what GPs received under Medicare and what it actually cost to deliver a consultation — wages for support staff, commercial rent, medical indemnity insurance, IT infrastructure, consumables, and the practitioner's own time — had grown to the point where bulk billing a standard Level B consultation (item 23) was economically unviable for many urban practices. As of 2025, item 23 attracts a Medicare rebate of approximately $42.85. A typical 15-minute consultation in a metropolitan practice costs the provider $65 to $90 to deliver, accounting for overhead allocation. The arithmetic of bulk billing has not worked for urban practices for well over a decade.
Rural and regional practices face additional cost pressures from workforce recruitment and retention — locum rates, above-award remuneration packages, and relocation incentives to attract GPs — that make the cost-revenue gap even wider than in capital cities.
The GP Workforce Crisis
Australia faces a structural shortage of general practitioners that will worsen over the next decade without deliberate policy intervention. The AIHW Health Workforce data series (2024) documents several converging pressures.
Workforce ageing. A substantial proportion of the existing GP workforce is approaching retirement age. The AMA's GP workforce analysis projects a net deficit of approximately 10,600 GPs by 2031 on current training and recruitment trajectories.
Training pipeline insufficiency. The number of GP registrar places through the Australian General Practice Training (AGPT) program has not kept pace with population growth. Critically, specialist training pathways in surgery, medicine, and other hospital-based disciplines continue to attract disproportionate shares of medical graduates, in part because specialist remuneration substantially exceeds GP earnings.
Burnout and exit. Australian Medical Association and Royal Australian College of General Practitioners (RACGP) surveys conducted in 2023 and 2024 document elevated rates of burnout among practising GPs. Administrative burden — chronic disease management documentation, e-prescribing compliance, MyHealth Record — combined with after-hours obligations and the financial stress of managing complex multimorbid patients under constrained appointment structures are recurring themes. An estimated 8% to 12% of active GPs report intention to reduce clinical hours or exit general practice within five years.
International medical graduate dependency. Australia relies on internationally trained doctors — International Medical Graduates (IMGs) — to fill approximately 40% to 45% of GP positions in outer regional and remote areas. Policy settings in source countries and the complexity of pathway-to-recognition processes create fragility in this supply chain.
The Urban-Rural Divide
Bulk billing rates vary dramatically by geography. Metropolitan areas — particularly inner-city and affluent suburbs — had already drifted toward mixed billing before 2022, but the decline has accelerated everywhere. In outer regional, remote, and very remote Australia, the problem is compounded by absolute workforce shortage: in some communities, there is no GP at all, let alone a bulk-billing one. The AIHW reports that the GP-to-population ratio in Very Remote Australia is approximately one-quarter of the metropolitan rate.
For patients in these areas, the out-of-pocket cost question is secondary to availability. First Nations communities in remote Australia face the most severe access deficit, a reality that sits in sharp tension with their disproportionate burden of chronic and preventable disease — cardiovascular disease, type 2 diabetes, chronic kidney disease, and respiratory conditions at rates two to four times higher than the non-Indigenous population.
The Triple Incentive Payment: Necessary but Insufficient
In November 2023, the Albanese government introduced a substantial restructuring of bulk billing incentives, colloquially termed the "triple incentive payment." Under the revised schedule, GPs who bulk bill concession card holders (Commonwealth Seniors Health Card, Healthcare Card, Pension Concession Card) and children under 16 receive an additional incentive loading on top of the base rebate — tripled from the previous rate. In major cities, the incentive loading for a Level B consultation for a concession card holder increased from approximately $6.60 to $20.65. In outer regional and remote areas, the loading is higher still.
The policy intent is clear: protect bulk billing access for the most economically vulnerable patients, conceding that universal bulk billing for the general population is no longer achievable under current rebate structures, while using targeted incentives to maintain access for those least able to pay gaps.
The response from the GP sector has been mixed. A subset of previously non-bulk-billing practices reinstated bulk billing for concession patients. The national bulk billing rate for concession card holders stabilised and in some measures ticked upward from mid-2024. These are genuine, if partial, successes.
However, the triple incentive does not address several structural problems. First, it does not apply to non-concession adults — the working poor, casually employed, or those who narrowly miss concession thresholds are left without targeted protection. Second, the incentive loading for metropolitan practices, while larger in dollar terms than before, still falls short of bridging the true cost-revenue gap for many practices. Third, and most fundamentally, the incentive payment is a patch on an indexation failure: it compensates for a rebate that remains too low, rather than fixing the underlying rebate level. The RACGP and AMA have both made clear that the triple incentive, while welcome, is not a substitute for systematic rebate reform.
Out-of-Pocket Costs: Who Bears the Burden
The Australian Bureau of Statistics Patient Experiences survey and the AIHW Australia's Health series document the distributional consequences of out-of-pocket healthcare costs. In 2022-23, approximately 12.4% of Australians reported delaying or avoiding seeing a GP due to cost — up from approximately 7.6% in 2019-20. The rate among the lowest income quintile is approximately three times that of the highest income quintile.
Cost-related avoidance of primary care is not clinically neutral. Delayed GP presentation is associated with later-stage cancer diagnosis, uncontrolled hypertension and diabetes presenting as acute cardiovascular events, untreated mental health conditions escalating to crisis, and preventable hospitalisations. Each of these outcomes is costlier to the system — via emergency presentations, inpatient admissions, and intensive care — than the avoided GP consultation would have been.
The downstream fiscal consequence of bulk billing erosion is therefore not a saving. It is a cost shift from a lower-cost setting (primary care) to a higher-cost setting (emergency department and inpatient hospital), with the burden transferred from the Commonwealth (which funds Medicare) to states and territories (which fund public hospitals). For a fuller treatment of how preventive health investment can reduce this cost shift, see our separate policy analysis.
Addressing mental health Medicare gaps is a closely related challenge: cost-related avoidance of mental health care in primary care has similar downstream consequences, and any serious bulk billing reform must account for the intersection between GP access and mental health service demand.
What Other Countries Do: International Comparators
The United Kingdom's NHS
The National Health Service model eliminates co-payments for GP visits entirely. GPs in England, Scotland, Wales, and Northern Ireland are independent contractors who hold NHS contracts under which they provide defined primary medical services to registered patients free at the point of care. The GP receives capitation payments (per-patient per-year) plus activity-based payments for specific services. Patients pay nothing for a GP consultation.
The NHS model has its own profound structural challenges — chronic GP shortages, long wait times in many areas, and a workforce crisis broadly analogous to Australia's — but out-of-pocket cost is not a barrier to primary care access in the way it has become in Australia. The lesson is not that Australia should replicate the NHS, but that universal access to gap-free primary care is achievable when the public payer covers the full cost of service delivery at a realistic rate.
Canada
Canada's provincial health insurance systems (supplemented by federal transfers under the Canada Health Transfer) cover medically necessary physician services without user charges. Provinces negotiate fees with provincial medical associations, producing fee schedules that — while imperfect — are revisited more frequently than Australia's MBS. Canada also has GP shortage problems, particularly in rural and remote provinces, and has invested substantially in nurse practitioner scope expansion and team-based primary care models as demand-management strategies.
The Canadian comparison is instructive on two points: team-based primary care genuinely reduces per-capita GP demand, and provincial fee negotiation cycles keep rebates closer to real costs than Australia's centralised, infrequently indexed MBS schedule.
Specific Reforms the Coalition Endorses
1. Systematic Rebate Restoration and Indexation Reform
The base Medicare rebate for standard GP attendances must be increased to close the cost-revenue gap that has accumulated over decades of underindexation. The RACGP has modelled a minimum 15% to 20% increase in Level A and Level B item rebates as the threshold at which bulk billing becomes economically viable for urban practices without targeted incentives. The Commonwealth should then transition to a rebate indexation mechanism tied to a General Practice Cost Index — a weighted basket of practice running costs including wage growth, commercial rent, indemnity premiums, and IT overhead — rather than CPI, which understates practice cost inflation.
2. Nurse Practitioner Scope Expansion
Australia has approximately 8,000 nurse practitioners but significantly restricts their prescribing authority and Medicare billing rights compared to Canada, New Zealand, and the United Kingdom. Expanding nurse practitioner scope — particularly for managing well-controlled chronic conditions (hypertension, type 2 diabetes, asthma, lipid management), mental health first-contact care, and preventive health assessments — would increase effective primary care capacity without requiring additional GPs. The RACGP and Australian College of Nurse Practitioners reached a joint position in 2024 supporting collaborative team-based models with expanded nurse practitioner billing rights; the Commonwealth has not yet moved to implement it at scale.
3. Telehealth Permanency and Expansion
The COVID-19 pandemic produced a rapid expansion of Medicare-rebated telehealth for GP consultations. The evidence base for telehealth in managing chronic disease, mental health, and follow-up care is now substantial. Making telehealth permanently available — including for initial consultations where clinically appropriate — reduces travel and time costs for patients in outer regional and remote areas, increases effective appointment capacity for practices, and supports after-hours access. The telehealth rebate parity question (ensuring telehealth consultations attract the same rebate as face-to-face for equivalent consultation length and complexity) must also be resolved.
4. GP Training Pipeline Investment
The Commonwealth should expand AGPT places by a minimum of 1,500 per year for the next five years, with specific loading for training positions in outer regional and remote areas. Reducing the medical graduate debt burden (through Commonwealth-funded medical school scholarships conditional on GP training) and improving GP specialty pay relativities relative to hospital-based specialists are both necessary to shift the graduate career incentive structure. The rural generalist pipeline — combining GP training with procedural skills in obstetrics, anaesthetics, and emergency medicine for rural posting — should receive dedicated Commonwealth investment.
5. PBS Access to Weight Management Medicines
PBS access to weight management medicines is directly connected to the bulk billing debate: effective weight management reduces the chronic disease burden that drives GP consultation demand. GLP-1 receptor agonists listed on the PBS at accessible co-payment levels reduce the downstream primary care and hospital load from obesity-related cardiovascular disease, type 2 diabetes, and sleep apnoea — conditions that collectively account for a substantial share of GP consultations. The policy case for PBS listing is thus not only a matter of direct patient access; it is a system-level demand management argument.
6. Prevention Investment as Demand Management
Ultimately, the bulk billing debate is a downstream symptom of a health system that underinvests in prevention. A population with lower rates of preventable chronic disease requires fewer GP consultations, which reduces the demand load on a constrained workforce and makes universal bulk billing more fiscally achievable. The prevention investment package outlined in our preventive health investment analysis — expanded allied health access, metabolic screening, lifestyle prescription programs, and a re-established national prevention agency — is a necessary complement to rebate and workforce reform.
The Path Forward
Australia's bulk billing crisis did not emerge suddenly. It is the cumulative product of decades of rebate underindexation, a GP workforce pipeline that has not kept pace with population growth and ageing, and a political culture that has treated Medicare as a headline commitment while systematically underinvesting in the inputs that make it functional.
The triple incentive payment stabilised part of the problem for the most economically vulnerable patients. It is not a solution. A genuine solution requires: rebate restoration and a credible indexation mechanism; GP training pipeline expansion; expanded nurse practitioner and allied health roles in team-based primary care; permanent telehealth infrastructure; and sustained investment in prevention to manage long-run demand. These are not cheap. Collectively, the rebate restoration alone would cost approximately $2.5 billion to $3.5 billion per year in additional Commonwealth expenditure. But the alternative — continuing the cost shift to emergency departments and inpatient hospitals, at rates per episode three to eight times higher than a GP consultation — is fiscally and clinically worse.
The Coalition for Better Health's position is that restoring the Medicare compact requires the Commonwealth to treat GP rebate adequacy as a first-order fiscal commitment, not a residual claim on whatever the budget can absorb after acute care priorities are met.
This analysis represents the Coalition for Better Health's policy advocacy position, based on publicly available data from AIHW, the Department of Health, and parliamentary submissions.