People suffering severe mental illnesses will be able to access Medicare benefits for drug and alcohol addiction services as part of treatment programs tailored to their conditions.
Health Minister Sussan Ley said on Wednesday that the government would subsidise "complex care services" that health professionals recommended for people with severe mental illnesses. She said this would go beyond psychological services to include mental health nursing, drug and alcohol services, vocational assistance, peer support and care coordination support.
People with mental illnesses are currently only eligible for Medicare benefits for up to 10 psychology sessions, if their GP places them on a mental health plan.
"Just like any other chronic disease, mental illness is often complex and requires access to multiple health professionals and support services to address it properly," Ms Ley said on Wednesday.
"Experts recognise many patients with severe or complex mental health needs would benefit from an integrated health care package tailored to their individual needs and that's what we're delivering."
Ms Ley is expected to deliver the government's long-awaited response to the National Mental Health Commission's review of Australia's mental health services on Thursday.
The review, released last November, said the mental health system was inconsistent, did not deliver proven successful outcomes and did not present the government with value for money, with "too many" mentally ill people suffering more as a result of their treatment and avoidable involuntary seclusion and restraints.
Among its 25 recommendations, the commission said the government should divert at least $1 billion of federal funding from acute hospitals to community-based mental health services. Most federal funds for mental health were spent on acute care, it said, which could be "indicators of system failure" rather than prevention and early intervention.
Ms Ley said the tailored mental health plans would become available through primary health care networks over the next three years, with trial locations to be announced by July.
Ms Ley said using primary health networks would improve support for people in regional areas, who were less able to access timely psychological services than those in major cities.
She estimated that between 4 and 5 million Australians suffered a mental health issue each year. Mental illness was the third largest chronic disease in Australia, behind cancer and cardiovascular disease.
