Federal Health Minister Mark Butler says a “comprehensive revamp” of Medicare is needed to make local clinics viable.

Butler pins the problem on Medicare rebates being frozen or subject to modest increases.

“There’s no question that the cuts, the freezing of the Medicare rebate for six years under the former government has placed enormous financial pressure on general practice in particular, and the Medicare system more broadly,” he told the ABC.

“But there are some broader structural issues at play here.”

The minister has worked with medical and patient groups to investigate problems with Medicare, with a final report to be published within weeks and funding to flow in the federal budget.

He warns the population is growing older with more complex chronic disease.

“Frankly I think our general practice right now is in the worst shape it has been in the 40-year history of Medicare,” Butler said.

“We’re no orphans, we’re seeing this across the developed world, but there are some particular challenges here in Australia that we are determined as a new government to fix.”

He wants local doctors to work closely with nurses, allied health professionals and pharmacists.

“The system is not well designed to allow them to do that,” Butler said.

The minister also said digital connections between primary health, hospitals and aged and disability care were “not up to scratch”.

There are also significant workforce issues, with fewer medical graduates choosing general practice than ever before.

Butler said less than 14 per cent of graduates were choosing careers in the sector, down from about half of university leavers.

“If we think we’ve got a problem now getting in to see a GP, think five, 10, 15 years down the track if we’re not able to turn those numbers around,” he said.

The general practice workforce issue formed part of the report on Medicare and has been discussed at national cabinet.

Health is expected to dominate discussions when national cabinet meets again in February, with the premiers of Victoria and NSW putting forward their own policy plans to ease pressure on hospitals.

Butler said the federal government was already pumping money into strengthening Medicare, assisting rural GPs and delivering urgent care centres to take pressure off hospitals.

“But I don’t pretend there’s not more we need to do,” he said.

The minister said it would take a concerted effort from the Commonwealth in consultation with the sector and the states.

“(The states) have got a direct interest in rebuilding general practice for the benefit of their communities,” Butler said.

“But also for the viability and sustainability of their hospital systems that are under pressure from presentations that frankly could be quite adequately dealt with in the community if the general practice system was in proper shape.”

-AAP