Federal Budget May 2024-25: Health & aged care

This Budget prioritises funding for health and aged care, with a focus on ensuring, in the words of the Treasurer, a “stronger Medicare in every community” and a “dignified retirement for older Australians”.  Key measures include additional funding to strengthen both the Medicare system and Australia’s ‘care economy’ with respect to older Australians.

Strengthening health and Medicare

The Government has committed funding of:

• $3.4 billion over 5 years from 2023-24 for new and amended listings on the Pharmaceutical Benefits Scheme (PBS) and the Repatriation Pharmaceutical Benefits Scheme (RPBS), providing eligible patients with significant savings on treatment costs.
• $2.8 billion over 3 years from 2023-24 to strengthen Medicare and to enhance Australia’s health system, including a $1.2 billion package to address pressures on the health system which provides:
  • $882.2 million to assist older Australians in avoiding hospital admission, being discharged from hospital earlier and improving their transition out of hospital;
  • $227.0 million to deliver an additional 29 Medicare Urgent Care Clinics and to enhance support for regional and remote clinics;
  • $90.0 million to address health workforce shortages by making it simpler and quicker for international health practitioners to work in Australia.
• $1.8 billion over 3 years from 2023-24 to support additional frontline staff at Services Australia;
• $1.4 billion over 13 years from 2024-25 to continue to invest in life-saving medical research in Australia through the Medical Research Future Fund, including:
  • $377.5 million to translate research outcomes into medical practice;
  • $329.6 million for patient centred research including emerging priorities in areas such as women’s health, innovative treatments, clinical trials and more advanced healthcare;
  • $269.6 million for medical researchers to make breakthrough discoveries, develop their skills and progress their careers in Australia.
• $1.2 billion over 5 years from 2023-24 to strengthen Medicare by supporting earlier discharge from hospital for older Australians, improving access to essential services, modernising Australia’s digital health infrastructure and ensuring the integrity and compliance of Medicare. Funding to support older Australians through earlier discharge from hospital includes:
  • $610.4 million over 4 years from 2024–25 for states and territories to invest in initiatives that address long stay older patient challenges, unique to each jurisdiction;
  • $190.0 million over 3 years from 2025–26 for the extension and redesign of the Commonwealth’s Transition Care Programme to provide short-term care of up to 12 weeks for older people after a hospital stay.
• $888.1 million over 8 years from 2024-25 for mental health services, including:
  • $588.5 million to establish a national low intensity digital mental health service that is free of charge and free of need for referral;
  • $71.7 million over 4 years from 2024–25 to provide ‘wrap around care’ for people with severe and/or complex needs in primary care settings, through design and delivery of mental health multidisciplinary services.
• $895.6 million over four years from 2024–25 to ensure the Medicare Benefits Schedule (MBS) remains clinically appropriate and reflects modern medical practices;
• $825.7 million to ensure Australians can access testing for and vaccinations against COVID-19;
• $631.1 million over 4 years from 2024–25 to support access to life-saving vaccines, including:
  • $490.0 million over 4 years from 2024–25 to continue the National COVID-19 Vaccine Program;
  • $82.5 million over three years from 2025–26 to ensure ongoing joint responsibility with states and territories for vaccination programs.
• $514.8 million over 4 years from 2024-25 to support preventive health initiatives, including:
  • $303.9 million over 2 years from 2024–25 to ensure the National Medical Stockpile can continue to respond to health emergencies and improve pandemic preparedness;
  • $55.3 million over 3 years from 2024–25 to maintain the National Critical Care and Trauma Response Centre which is Australia’s centre of excellence for health disaster response;
  • $41.6 million over 2 years from 2024–25 to continue support for the Good Sports Program, an alcohol management program for community sporting clubs, alcohol and drugs treatment services in areas of identified need, and support services in remote and rural regions.
• $468.7 million over 5 years from 2023-24 to support people with disability and to “get the NDIS back on track”.

Strengthening aged care

• The Government has committed $2.2 billion over 5 years from 2023-24 to improve Australia’s aged care system and deliver key aged care reforms, including:
  • $1.2 billion over 5 years from 2023-24 for the sustainment of critical aged care digital systems, supporting the introduction of the new Aged Care Act from 1 July 2025;
  • $531.1 million in 2024-25 to release 24,100 additional home care packages;
  • $174.5 million over 2 years from 2024-25 to fund the ICT infrastructure required to implement the new ‘Support at Home Program’ and Single Assessment System from 1 July 2025;
  • $65.6 million over 4 years from 2024–25 to attract and retain aged care workers, collect more reliable data, and improve the outcomes for people receiving aged care services through existing aged care workforce programs.

Health workforce

• The Government will provide $116.2 million over five years from 2023–24 to strengthen and support the health workforce. Funding includes:
  • $90.0 million over three years from 2023–24 to fund the implementation of the health related recommendations of the Independent review of Australia’s regulatory settings relating to overseas health practitioners (the Kruk Review) to grow and support the health workforce. This funding is a component of the $1.2 billion package of Strengthening Medicare measures agreed at National Cabinet in December 2023 and has been developed in consultation with the states and territories;
  • $17.4 million in 2024–25 to extend the General Practice Incentive Fund until 30 June 2025 to improve access to primary care in thin markets;
  • $4.7 million over five years from 2023–24 for the Northern Territory Medical Program to increase the number of First Nations medical practitioners and to address recruitment and retention challenges in the Northern Territory; and
  • $4.0 million over four years from 2024–25 to the Australian Indigenous Doctors’ Association to continue to support First Nations doctors to become medical specialists.
• The Government will also extend existing single employer model trials until 31 December 2028 to help attract and retain general practitioners (GPs) in areas of workforce need.

Cheaper medicines

• As part of the Government’s initiative to ease cost of living pressures, it has committed to:
  • finalising the new Eighth Community Pharmacy Agreement, supported by up to an additional $3 billion in funding. This will provide cheaper medicines, improve patient health outcomes and secure a strong community pharmacy sector;
  • a 1-year freeze on the maximum PBS patient co-payment for everyone with a Medicare card and a 5-year freeze for pensioners and concession cardholders;
  • ensuring no pensioner or concession cardholder will pay more than $7.70 (plus any applicable manufacturer premiums) in PBS patient co-payments for up to 5 years, even as payments rise in line with inflation.