The health reform commission has backed the Rudd government's plan for suburban super clinics to deliver primary health care, federal Health Minister Nicola Roxon says.
And the government will consider taking over hospitals if the states don't lift their game.
In its draft report, the National Health and Hospitals Reform Commission says the federal government should take control of key elements of the health system.
It urges the creation of one-stop health shops, where patients can access general practitioners, chemists, diagnostic services and allied health professionals.
Ms Roxon says the report backs the government's interest in strengthening the frontline of primary health care, so people can access care in their own communities rather than always going to hospital.
"What the report makes clear is that the direction that we flagged prior to the last election, with the GP super clinics, is something that our system needs," Ms Roxon told ABC Radio.
"It talks about comprehensive primary care centres, probably expanding our idea of super clinics even further."
Ms Roxon said the report was a directions paper only which would spark public debate.
But, she stressed, "the convenience of patients absolutely requires that we look at this direction closely".
As for the possibility of taking over the nation's hospitals, the health minister said, the government's position remained the same as when it was elected in late 2007.
"By the middle of this year, if we are not convinced that the states want to be partners in reforming our hospital services we would consider going back to the public (and) asking whether they wanted us to take over financial control of the hospitals."