Tonight’s federal budget locked in the much-needed additional funding for public hospitals announced by the prime minister in January, but there’s little else in it to address the critical issues facing Australia’s health system.
Australian Medical Association President Dr Danielle McMullen said the additional $25 billion for the next National Health Reform Agreement was very welcome but it still leaves a funding gap, and other opportunities to tackle healthcare system problems had been missed.
“We are pleased our long-running Clear the Hospital Logjam campaign has helped bring about this extra $25 billion for the new health reform agreement but as the 2026 AMA Public Hospital Report Card shows, it may not be enough,” Dr McMullen said.
“Our modelling shows a remaining gap of at least $9.6 billion — a gap that must be bridged if the cycle of crisis our public hospitals are in is to be broken.
“We are also pleased to see $120.9 million set aside to support the role of general practice in the early identification of children with development delay or neurodevelopmental difference through a Medicare funded three-year-old health assessment and expanded Comprehensive Health Assessment Program. It will be critical for all governments to ensure that appropriate support for eligible children is available on GP referral.”
But Dr McMullen said the budget provides little else to celebrate.
“While we welcome a commitment to undertake consultation on private health reform, cuts to the Private Health Insurance Rebate for people who are 65 years and over are likely to see older Australians on modest incomes drop or downgrade their cover and this may put more pressure on the public hospital system,” Dr McMullen said.
“The trend of people paying more for less when it comes to private health insurance cannot continue if we are serious about protecting our healthcare system. Our proposal of a minimum 90 per cent pay-out ratio would help to address the growing imbalance we’re seeing."
The need for a Private Health System Authority is becoming increasingly urgent to drive reform and support a more sustainable private health system, Dr McMullen said.
“The budget also neglects much needed reforms in primary care to ensure Australians can get the care they need, ignoring our costed recommendations that would put the system on a sustainable footing is a missed opportunity.”
Dr McMullen said that while the government has made the decision in this budget to cement the role of urgent care centres in our health system, further refinement of the model is needed to ensure that UCCs have much stronger links back to a patient’s usual GP and avoid fragmenting care.
“Urgent care centres don’t provide the structural reform to Medicare that’s needed and interventions to support bulk billing in discrete geographic areas are not long-term fixes. We need meaningful reform and funding that improves after-hours access to GPs and modernises Medicare, so it reflects the complex contemporary care needs of an ageing population.
“Again, we have put forward a costed, structured and detailed reform proposal at a very modest cost to restructure GP items, and we have time and time again pointed out the lack of funding indexation to see non-GP specialists. This budget locks in another year of substandard indexation that will leave the rebate further behind in a high inflation environment. The time for delay is over — it's time to modernise Medicare.”
The AMA has previously released detailed proposals for an Independent Health Workforce Planning Agency to provide independent advice on our future medical workforce needs as well as for a significant lift specialist training places. At a time when some patients are struggling to access specialist medical care, these investments could have made a real difference for patients.
Another key measure missing from the budget is the introduction of a tax on sugary drinks — a proven public health initiative that has worked in jurisdictions around the globe.
“Decisions taken today about healthcare can leave a legacy that shapes the health of our communities for many, many years to come. Our recommended tax on sugary beverages is a win/win for everyone as it would reduce annual sugar consumption by about 2kg per person, raise around $3.6 billion in four years, and improve public health across Australia.”
