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InPsych 2011 | Vol 33

October | Issue 5

Professional practice

Medicare Locals and the changing primary health care landscape

In response to the challenges facing the Australian health system, in 2007 the Australian Government committed to a major health reform agenda by establishing three significant reform initiatives through the National Health and Hospitals Reform Commission, the National Primary Health Care Strategy Taskforce, and the National Preventative Health Taskforce. In 2010 the most extensive reforms to the Australian health system since the introduction of Medicare were announced. Under the reforms, a new primary health care system will be established involving a national network of primary health care organisations throughout Australia, called Medicare Locals. Through the Council of Australian Governments' National Health and Hospitals Network Agreement, the Medicare Locals will work together with Local Hospital Networks to form a National Health and Hospitals Network to deliver more integrated, locally responsive and flexible health services with the aim to improve consumers’ pathway through the health system.

Implementation of the health reforms is likely to affect psychologists in a number of ways. This article details the planned changes in the delivery of primary health care through the Medicare Locals network, provides information on the potential impacts and opportunities for psychologists, and highlights APS advocacy to ensure that psychologists are well placed to support coordinated and high quality evidence-based care through the new structure.

What we know about Medicare Locals

How they will function

Medicare Locals will be independent primary health care organisations formed from the existing Divisions of General Practice in partnership with other local organisations. As the fundholders for primary health care, Medical Locals will have significant power to determine which services are funded and who delivers them. During transition, Divisions of General Practice will need to build and extend their structures and relationships in order to be well placed to work with State-funded services and other organisations involved in primary health care at the local, regional, and State level.

The aim is for Medicare Locals to support health professionals and improve primary health care delivery through coordinating, planning, and, where gaps are identified, delivering a range of services to meet the needs of the communities in which they are based. Whilst most Medicare Locals will be evolving from Divisions of General Practice, their responsibility will be expanded to connect with the entire primary health care network, to coordinate care across the spectrum of health of the population they serve.

Each Medicare Local will need to adapt to unique challenges in order to best coordinate services appropriate to the specific population groups, health needs, and geographic and demographic make-up of its community. To provide better integrated care in a system that is easier for patients to navigate, Medicare Locals will need to meaningfully engage and partner with existing organisations, local communities, health professionals, and service providers including GPs, and allied health professionals.

Where they will be located

Medicare Locals will be located across Australia, totalling 62 nationwide. The boundaries for Medicare Locals have been determined through consideration of factors including alignment to Local Hospital Networks, population, and patient referral patterns. The planned network of Medicare Locals is indicated on the map.

The implementation of Medicare Locals is being conducted in three stages. The first 19 Medicare Locals commenced functioning in July 2011 and are located in the ACT (1), New South Wales (4), Victoria (4), South Australia (2), Queensland (5), Western Australia (2) and Tasmania (1). The second tranche of approximately 15 Medicare Locals will commence from January 2012 and the remaining 28 Medicare Locals are to be operational by July 2012.

Medicare Locals and psychologists

The integrated health care model of Medicare Locals will potentially provide significant opportunities for psychologists to collaborate with local health professionals on team-based health care and increase community access to effective psychological treatments. As Medicare Locals grow and adapt to meet the needs of the local community, there may also be opportunities for psychologists to support health prevention programs, early intervention strategies, chronic disease management and community-based mental health care. By promoting connections with Local Hospital Networks, communities, health professionals, and service providers, Medicare Locals will also support psychologists’ work within existing government initiatives including the Access to Allied Psychological Services (ATAPS) and Better Access initiatives.

Introducing a new network of organisations into an already complex web of governance, planning and service delivery is also likely to present a range of challenges. With Medicare Locals planning and making decisions for funding of primary health care in the local area, there is potential for health care provision to move toward a managed care model where consumer choice of provider may be reduced. Further, provider determination of referrals and pathways of care may be constrained. Finally, the capped nature of funding may also lead to restrictions in service provision. To best manage these potential challenges, it is critical that Medicare Locals develop into well informed, well connected and high functioning organisations. Balanced, fair and effective governance arrangements will be essential for Medicare Locals to perform their expected roles and functions, and to manage provision of the most efficient, effective and appropriate care to the community.

APS advocacy in the establishment of Medicare Locals

Whilst the APS supports the overall aims of introducing Medicare Locals, and the current transition of Divisions of General Practice to Medicare Locals, there will be several challenges during transition and beyond. It is vital that the governance arrangements of Medicare Locals reflect broad primary health care and a range of clinical expertise, and encourage active community engagement. Enabling a range of health professionals to apply their knowledge and skills to inform the strategic directions and decision making of Medicare Locals will support providers in the local area to contribute their professional expertise to deliver the best health outcomes for the community.

Since the announcement of the introduction of Medicare Locals, the APS has advocated for broad stakeholder involvement in representative, accountable and transparent governance structures. To ensure that Medicare Locals support psychologists in their critical role in delivery of primary health care, and that communities can benefit from full access to psychological as well as medical services, the APS has argued it is critical that psychologists are involved in governance, planning, implementation and sustainability of Medicare Locals.

The APS has promoted the essential contribution of psychologists in strengthening health policies and programs and addressing the critical workforce demands, and lobbied for involvement of psychologists in taskforces, working groups, boards and other decision making structures. Psychologists involved in the governance of Medicare Locals will have the opportunity to identify gaps in services at the local level, and contribute to developing innovative models of service provision to address these needs. In areas where psychologists clearly have the appropriate expertise, the role of psychology can be promoted. Creation of new services will provide opportunities for the discipline and profession of psychology to have increased involvement in delivery of care.

The APS has also advocated for the role of psychologists in the reforms through discussions with government, development of a number of submissions, and participation in stakeholder groups. Participation in the reform process has also been strengthened through the APS membership of Allied Health Professions Australia as well as the National Primary Health Care Partnership, whose membership represents over 100,000 frontline health professionals working in the primary health care sector. In addition, the APS Executive Director is a member of the National Transition Advisory Committee run by the Australian General Practice Network, which is overseeing the transition of the Divisions of General Practice into Medicare Locals.

The APS will continue to advocate for the contribution of psychological expertise and effective psychological interventions in supporting Medicare Locals to drive and strengthen primary health care delivery to meet the changing health needs of the Australian community. At the local level, the APS is aiming to work with Branches and the group of APS Strategic Leaders to help represent psychologists as the new Medicare Locals are established. To ensure psychologists are able to contribute their professional expertise to support the best health outcomes, psychologists are urged to participate at the local level and engage in Medicare Local processes and structures.

Where to find more information

The APS will ensure that members are kept informed of important developments in the health reform process and the implementation of Medicare Locals. Further information on health reform and Medicare Locals can be found at the Australian Government Department of Health and Ageing website (www.yourhealth.gov.au). The Australian General Practice Network website also provides information about the transition to Medicare Locals (www.agpg.org.au).


Disclaimer: Published in InPsych on October 2011. The APS aims to ensure that information published in InPsych is current and accurate at the time of publication. Changes after publication may affect the accuracy of this information. Readers are responsible for ascertaining the currency and completeness of information they rely on, which is particularly important for government initiatives, legislation or best-practice principles which are open to amendment. The information provided in InPsych does not replace obtaining appropriate professional and/or legal advice.