GP fees won't increase for 12 months under new proposal, Labour says it locks problem in place

The document said Health NZ had agreed to boost primary care funding by $120.6 million in 2026/27.

Photo: Unsplash / Getty Images

The cost of a doctor's visit won't increase in the next year under a proposed new policy.

The changes have been revealed in an in-principle agreement between Health NZ and the primary care sector.

The document, seen by RNZ, would see GP fees frozen until 1 July 2027.

It said that recognised the importance of maintaining affordable and accessible healthcare services, considering New Zealanders' ongoing struggle with the cost of living.

The plan was conditional on consultation with contract providers, primary health organisations and Māori providers, as well as due diligence on a new GP funding model.

The document said Health NZ had agreed to boost primary care funding by $120.6 million in 2026/27.

Of that, $45.8 million would increase capitation rates - GPs' funding - by just over 3 percent to cover cost pressures like inflation.

It also included another $30.4 million to further increase capitation rates by 2.84 percent "to fund fees stability" over the next year.

That meant the cost of a doctor's appointment for the next year would remain at today's cost.

Practices that had planned fee increases could do so in future years, but not in the next 12 months, it said.

GPs could apply to Health NZ for an exception to the policy if they would be forced to close or reduce services, or if they needed to raise money for investments like new buildings to allow them to take on more patients.

The document said Health NZ agreed to change the rural funding framework, which would see more practices classified as rural, making them eligible for extra funding.

Others could be shifted to an urban classification, but would be able to make a case to retain the extra money.

President of the Royal College of GPs Dr Luke Bradford explained an uplift was offered each year.

"It's not always an uplift that keeps up with inflation," he said.

But this increase would bump funding for GPs across the board - by how much, would depend on their population's demographic makeup.

"It's more if you've got older patients, or if you're very rural, or if you've got patients with lots of comorbidities," he said.

"We've been calling for that, so that's a good thing because it better understands the demands on general practice faced by different patient groups. But because it's variable across your practice population, it means that some practices aren't going up by as much."

The offer was good in that it would keep fees the same for patients - "but that will have different impacts on different practices in terms of sustainability".

Proposed overhaul of GP funding model

The change to capitation and rural funding could see some practices get more money, while others would lose out, the document said.

Capitation is how the government funds GPs, giving clinics a fixed amount per patient each year, taking into account their age and sex.

Simeon Brown welcomes the in-principle agreement.

Photo: RNZ / Mark Papalii

Health Minister Simeon Brown announced last year that model would be updated for the first time in two decades, to better reflect patients' needs.

The document revealed the revised formula that would be in place from 1 July.

As well as age and sex, it would consider any comorbidities, deprivation, and a premium for very rural practices.

It noted some providers wanted ethnicity included, but that was not accepted because it was outside Cabinet policy settings.

Health NZ agreed on "transitional funding" to support practices that would be worse off due to the changes.

It said 14 percent of practices would need that to bring them up to current funding levels, and 39 percent would need it to smooth over the combined impact of all the changes.

The transitional funding amounted to $26.8 million in 2026/27.

Health NZ said the overall funding increase was "significant" and aimed to ease cost pressures on patients while strengthening frontline services.

"The funding proposals ... are currently out for general practice feedback with agreements expected to be confirmed before the end of June," said its funding director Martin Hefford.

Minister pleased, opposition says government's locking in high fees

Health Minister Simeon Brown welcomed the in-principle agreement.

"Improving access to primary care is a key government priority, as we know the greatest challenge for patients is simply being able to get a timely GP appointment.

"It is encouraging to see these important negotiations continuing to make progress," he said.

He looked forward to the "successful conclusion" of the negotiations, he said, adding that the government had delivered record investment into the health sector.

Labour says this plan isn't the solution to high fees.

Photo: RNZ / Samuel Rillstone

But Labour's health spokesperson Dr Ayesha Verrall said National had no plan to bring GP fees down.

"A one-year freeze doesn't solve the problem, it locks it in place," she said.

"Clinics shouldn't have to choose between putting up patient fees and absorbing rising costs. This has led to reduced services, longer wait times, and practices that are closed to new enrolments."

Labour was campaigning on a policy which would give every New Zealander three free GP visits each year.

Verrall said it would also introduce an independent pricing authority that would manage GP funding.

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