Why Most Australian GPs Already Run Their Own Business

Short answer

Most Australian GPs are not employees of the clinics they work in. They are independent contractors, effectively running their own small business, who pay the practice a service fee to use a consulting room. Many GPs do not think of their work this way day to day, but the structure of how they are paid confirms it.

How does the room-rental model actually work?

In a typical practice, a GP bills Medicare and patients directly for each consultation. The practice then takes a service fee out of those billings, usually somewhere between 25 and 40 percent, to cover the cost of the consulting room, reception staff, nursing support, and equipment. The GP keeps the remainder, which industry sources put at roughly 60 to 75 percent of billings depending on experience and the specific arrangement.

This is functionally a rent arrangement. The GP is the business. The clinic is the landlord, and the service fee is the rent, dressed up in medical industry language.

Why does this matter for how many patients a GP sees?

A standard short Medicare consultation (Level B) attracts a rebate of around $42.85. Once the practice's service fee is taken out, the room needs a certain volume of consultations passing through it each hour to be worthwhile for both the practice and the GP. This is part of why bulk-billing clinics commonly run at 4 to 6 consultations an hour.

The GP is not necessarily choosing to rush patients. The economics of the room they are renting are doing that for them.

Are GPs employees or business owners?

Most Fellowed GPs in Australia work as contractors, sometimes described as sole traders. They are responsible for their own tax and superannuation arrangements, choose their own billing approach within practice policy, and do not receive paid leave the way an employee would. In every meaningful sense, they are already operating as an independent business inside someone else's building.