The Australian and Victorian Governments have completed a jointly commissioned independent review of cohealth’s general practice service model, governance and finances, following its decision to close clinics in Collingwood, Fitzroy and Kensington. The review examined service delivery, governance arrangements and financial sustainability, and considered options to support continued access to these services for the community.

The report found that cohealth provides essential services to communities with complex health and social needs, but identified significant challenges in governance, service delivery and financial sustainability. cohealth general practitioners (GPs) look after about 7,000 patients across its four clinics, almost 5,000 in the three sites slated for closure. 

The report provides 13 recommendations. Both governments are progressing a coordinated response focused on service continuity, strengthening governance and the implementation of necessary reforms. 

Key findings

• Confirmed that the GP clinics were indeed running at a loss. 
• Contrary to the views expressed publicly by cohealth – that the Medicare Benefits Schedule funding model was the main cause of the clinics’ losses, and that Medicare did not provide funding for appropriate services for the population served by cohealth – the review found that ineffective governance and management had also contributed significantly to cohealth’s financial problems. 
• The clinic losses were partly driven by cohealth’s management of GPs and clinics, the way it schedules patient appointments, and its allocation of overhead costs to clinics. 
• Nonetheless, even with the best management in the world, the three clinics would still run at a marginal loss. So, Medicare funding arrangements do indeed need to change. 

Key recommendations

• Consider new governance arrangements; strengthen governance and management arrangements and organisational culture; rebuild stronger links with local communities.
• Co-design new multidisciplinary model of care; strengthen clinical leadership and engagement
• Co-design new multidisciplinary model of care
• More support for expanded multidisciplinany teams.

This version of the document includes redacted and removed material (including appendices).