After years of reviews and recommendations, now is the time for blended funding models to be implemented in primary care, write Dr Leigh Clarke, CEO of the Victorian Healthcare Association, and Amelia Condi, the organisation’s General Manager – Policy and Advocacy.
Leigh Clarke and Amelia Condi write:
Momentum is building for primary care reform to enable the development and implementation of blended funding models, to better support the community’s healthcare needs, and to enable greater use of multidisciplinary teams delivering wrap around, coordinated care.
The Federal Government has clearly signalled its intention for primary care reform, yet the method and timing are still to be determined.
The primary care sector has long called for changes that support closer alignment to the needs of the community they are serving.
What we need now is for Federal and State Governments, the primary care sector and communities to redesign the system together, with the same long-term view.
This process can draw upon the many reviews that have highlighted the imperatives for moving to blended funding models.
Policy recap
In 2023, the Federal Government’s Strengthening Medicare Taskforce Report set out a vision for a system where Australians are supported to be healthy and well. Blended funding models were highlighted as a prominent recommendation to support multidisciplinary models of care and improve chronic disease management.
In 2024, the Review of General Practice Incentives stepped out the opportunity for blended funding, enabling GPs to use funds flexibly to provide multidisciplinary care, based on patient needs, socio-economic status and location.
The same themes emerged in 2024 in the Scope of Practice Review, which notably provided the mandate for shifting from a 90:10 split between fee-for-service and blended payments, towards a 60:40 balance. This payment structure incentivises innovative models of care, led by rural generalists, nurses, allied health professionals and midwives.
The Working Better for Medicare Review, 2025, further reinforced this, finding that an extension of blended funding would help to address workforce supply and distribution challenges across priority areas.
The 2024 Review of After-Hours Primary Care Programs and Policy highlighted opportunities to reform practice incentives payments for after-hours care to better enable healthcare professionals to work to their full scope of practice within multidisciplinary care models.
More recently, the 2025 Primary Health Network Program review examined the PHN business model and recommended that funding processes be simplified to give PHNs flexibility to commission services tailored to community needs.
On the ground, this must be delivered as responsive approaches to community need, with timely provision of integrated and collaborative services that look beyond the current model of healthcare delivered service stream by service stream.
Victorian perspectives
In 2024, the Victorian Healthcare Association (VHA), the industry body representing Victoria’s diverse public healthcare sector, pushed for blended funding models in the Victorian Health Investment Strategy, bringing together the evidence arising from the numerous recommendations into a policy solution that would address the healthcare needs of many vulnerable Victorians.
The Strategy takes a long-term view of the investment needed in Victoria’s publicly funded healthcare system, including across both Federal and Victorian Governments. Blended funding must be stood up to enable the sustainability of primary care for vulnerable communities and people with multiple and/or complex health needs.
The recent independent review of the general practice model at cohealth highlights the challenges that are common across primary care. While all general practice providers are impacted by structural challenges in the Medicare Benefits Schedule (MBS), this is often amplified in communities experiencing higher levels of social disadvantage, such as those served by Victoria’s community health services. The review acknowledges the inflexibility of current funding models, particularly in facilitating a multidisciplinary model of care to better support patients who are vulnerable.
The VHA provided a submission to the cohealth review calling for a blended funding model that adjusts for vulnerability. In this way, blended funding would enhance the scope of health response delivered to patients with multiple and complex needs.
Building on this, the Chair of Community Health First, Anna Robinson, describes the challenge of delivering a person-centred model of care, within a historical funding structure that lacks suitable flexibility. She says: “Victoria’s community health sector have been pioneering innovative, multidisciplinary models of care for many years alongside general practice.
“This has allowed the sector to support some of the most vulnerable members of the community to address their multiple, intersecting needs and stay healthy and well in their communities.
“However, this work has occurred despite, not because of Medicare, with many organisations cross-subsidising these models through other funding streams to make person-centred care available to our communities. We know wrap around care models work, we have the solutions – we just need the funding and policy settings to catch up.”
Blended funding models, leveraging both the MBS and block funding, will enable a flexible and tailored response to healthcare.
We know that vulnerability needs support, and that complexity brings challenge. A block funding supplement would work in partnership with MBS to allow for longer appointments, mix of care and connection to the right health professionals through a multidisciplinary model.
Flexibility critical
To create a primary care system which responds to complexity and needs, funding needs to suit the care to be provided.
A one size fits all approach to in-and-out GP consultations will not work where multiple or complex issues are present. Nor will our standard referral process, placing the onus on the patient to follow up, book and attend a referred appointment sometimes weeks or months after the referral is made.
Presently, our primary care model is built upon a transactional approach to appointments, based on allocation of time per health issue.
Rates of chronic disease are rising, as are the numbers of people with multiple and complex health needs. More often, the healthcare system is seeing people with multiple and intersecting health needs, including chronic illness, mental health conditions, trauma, alcohol and other drug use and homelessness.
Medicare was designed in a different time. We know that people with complex health needs and those experiencing socio-economic disadvantage require more than episodic care.
For people with multiple or complex needs, a one-size-fits-all response will not work. Access to longer and timely appointments allows for a person to seek medical help for each of their issues, without rush or dismissal.
Longer appointment times and flexible approaches to delivery will allow for patient-doctor trust to be established, for deeper exploration of health issues and to discuss follow through and home-based care.
Additionally, a solo practitioner will not always be the right response where multiple and complex issues are at play. Funding flexibility to allow multidisciplinary teams to work with the person in a coordinated way will support better health outcomes.
The system needs to wrap around patients. A multidisciplinary model of care brings together a team who work together, at the top of their scope of practice, to leverage multiple skills in responding to patients and their health needs.
This allows for greater input and coordination to care, more timely treatment and removes the navigation complexity for patients.
Research by the Grattan Institute has shown that the multidisciplinary team model improves quality of care and health outcomes for people living with complex chronic conditions, while enabling speedier access to care and freeing up GPs for more complex care.
Moving forward
The complexity and scale of need, and the inflexibility of the MBS funding model create a difficult framework for the delivery of primary care. The system is no longer fit for purpose due to the concurrent challenge of it being built for the majority and the significant increase in health complexity and vulnerability.
An alternative model of funding must ensure people with complex, multiple healthcare needs receive the appropriate time, person-centred care and access to a multidisciplinary team. A blended funding model is key to providing primary healthcare providers with the required level of flexibility.
A move towards a blended funding models for primary care would be built on current MBS approaches, possibly allowing for coupling or grouping of multiple six-minute sessions for multiple and complex issues.
Alongside this would be a block funded component to bolster the care provision for vulnerable communities and priority cohorts. This mix creates a response which adequately adapts to the needs of a patient and the range of complexity with which they present, rather than fitting the patient into a fee schedule.
The case for reform has been made repeatedly, with policy approaches well recognised by the Federal Government and long known by the sector. The task is now turning that consensus into action.
As has been reflected in recent commentary across Croakey Health Media, there is much more work to be done if we want to build a primary care system designed around the needs of patients and communities.
Achieving this will require commitment from all levels of government, alongside investment and system readiness to support successful, long-term change.
Author details
Dr Leigh Clarke is CEO of the Victorian Healthcare Association and an experienced executive in the health sector, with a track record of leading high-performing member associations.
Amelia Condi, General Manager – Policy and Advocacy at the Victorian Healthcare Association, is an experienced executive in the health and community sector, with a track record of leading significant reform initiatives and complex programs.
See Croakey’s archive of articles on health financing and on primary healthcare
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