Agencies that recruit doctors for rural areas will be given financial incentives to hire Australian doctors over foreign-trained ones.
Assistant Health Minister David Gillespie has announced a three-year, $93 million funding agreement for the Rural Workforce Agency program, which is tasked with attracting, recruiting and supporting medical staff in rural and remote communities.
But unlike previous funding arrangements, which provided $11 million to agencies that had an overseas-doctor recruitment strategy to meet the shortfall in rural areas, agencies will be discouraged from hiring foreign-trained doctors.
Instead, funding will be directed towards hiring Australian doctors and ensuring the doctor is the right fit for the community.
"This redesign is to change the focus away from retaining overseas-trained doctors to fill gaps and getting home-grown and rurally experienced Australian graduates into these places," Dr Gillespie told AAP.
"If you just hop off the bus or hop off the plane and work in a regional area that you're not used to, you need support to get your roots into that community.
"We've got to embed these professionals into these communities and we want the agencies to be involved in that."
The new direction attempts to solve two problems - official figures suggest Australia is headed for a doctor oversupply of 7000 by 2030, yet rural communities still suffer from a doctor drought.
Overseas-trained doctors have typically been hired to go to rural and remote communities where it is hard to attract Australian doctors, but there have been concerns some foreign doctors are doing only the minimum time required before moving to metropolitan areas.
It comes as the federal government seeks advice on whether to curb the influx of foreign-trained doctors, with Dr Gillespie labelling the status quo "unsustainable".
On Friday, the minister met an advisory group set up in 2016 to assess whether Australia should roll back measures implemented in the 1990s to deal with a doctor shortage, such as bringing in more overseas-trained doctors and increasing medical student places.
The National Medical Training Advisory Network is due to provide its final report to the minister within weeks.
It will also advise on how to redistribute medical schools and training places to address the rural doctor shortage, with evidence suggesting that if doctors do most of their training in a rural community, they are more likely to want to make a life there.
Dr Ewen McPhee, president of the Rural Doctors Association of Australia, says overseas-trained doctors placed in rural communities are often under-resourced, under-supported and lack the skills required for the job.
"They come from different cultures ... they're often shoved out here because it's the only way they're going to get a job," he said.
"We simply have a massive reliance on international medical graduates to fill positions in rural and remote Australia because our own domestic graduates won't.
"We have more medical students than we've ever had before - it's time we saw a return on that investment."
