In its Final Report, the National Health and Hospitals Reform Commission has recommended radical change in the way health care for Aboriginal and Torres Strait Islander people is funded. The proposed National Aboriginal and Torres Strait Islander Health Authority (NATSIHA) would act as a third-party payer for all health care used by Indigenous Australians who choose to enrol.

We know that Indigenous people in cities, towns and remote areas don’t get the health care they need to the same extent as other Australians. Good care is being delivered, but not enough. Aboriginal Community-Controlled Health Services (ACCHSs) around Australia are making progress — on mother’s and babies’ health, and on better control of chronic diseases, for example. Some mainstream primary care services, and hospitals, are also improving. But progress is patchy, and doesn’t often show up in broad “headline” indicators like early death.

It’s not that we lack high-minded policy statements — there are lots of those. The challenge is to turn good intentions into effective action. Will the Commission’s approach work better than the current arrangements? There are some important facts that help in considering this question.

First, ACCHSs have done a better job than governments in many parts of the country in getting good services to Aboriginal and Torres Strait Islander people. The Commission is right to call for strong support for this sector.

Second, since Commonwealth responsibility was transferred into the health portfolio the sector is better funded, but not to the level required for equity. The Commission is correct in saying responsibility for funding should stay within health.

Third, we know that ACCHSs are funded in more complex and burdensome ways than any other part of the Australian health system. Recent research, due to be released next week, has documented high transaction costs, lack of security, and huge complexity because governments fund the sector through multiple tightly- targeted programs from several portfolios.

Finally, the involvement of both levels of government seems to lead to argument and blame. The need for extra layers and structures to coordinate action, or more often the appallingly slow rate of any action at all, are serious barriers to good program delivery — with honourable exceptions from time to time. It seems to be of little use to talk about cooperation and a “whole of government” approach — it just doesn’t happen. If the Commonwealth takes clear responsibility for funding primary health care, and increases the total pool, it could be better.

Will the proposed NATSIHA solve these problems? Well, it could. If all funding for Aboriginal health was put into one bucket, and managed by an agency that was focused only on funding Aboriginal health care, and included in its decision-making the right representation, structures and processes to ensure respect for the needs and preferences of Indigenous people and communities, yes, it could. It could fund primary health care properly, reduce complexity, build long-term relationships, share risks, and build meaningful two-way accountability. And it could bring funding for the ACCHS sector up to the needed levels.

But these are big “ifs”, and there is always risk in putting all eggs in one basket. Anyway the plan needs more work. Now is the time for some serious testing, listening, and a willingness to act on the evidence. What is needed is a real effort to ensure agreements about change are implemented, with serious intent through respectful processes.

The challenge is this — if it’s going to work, it has to be based on respect and trust for Indigenous organisations and leadership. Both the sector and governments will have to follow up on what Indigenous people have been recommending for years — co-operation between governments and communities; ‘bottom up’ involvement in services and planning; sustained consistent government support; and good governance on both sides.

This is also what the Productivity Commission (and almost everyone else) have found to work in Indigenous affairs. But these insights are almost always ignored the next time government announces a new policy. This time, the ACCHS sector is organised, skilful and ready to engage. We have to get it right.

Stephanie Bell has 15 years of experience as Director of the Central Australian Aboriginal Congress in Alice Springs. Professor Judith Dwyer, Flinders University School of Medicine, is the lead author of The Overburden Report: Contracting for Indigenous Health Services, due for release next week.