Perhaps the only person in the mental health world who was genuinely surprised by the choice of Pat McGorry as Australian of the year was McGorry himself. Even though he has been at the forefront of international clinical research and health services developments for young people, he has never expected to be so openly praised for his work. After all, mental health rarely attracts the accolades afforded cancer specialists, infectious diseases breakthroughs or other “miracles” in medical research.

In fact, such has been the extent of the neglect of his work in Australia, we are all indeed fortunate to still have him residing on these shores. The international offers to relocate to more friendly (and very well-resourced) academic centres are frequent and continuing.

When the neglect of McGorry’s work is combined with the openly hostile professional and bureaucratic responses to its implications, it is very surprising that he still remains so enthusiastic about the possibility of bringing about real change in this country. For 20 years, McGorry has been the champion of early intervention in psychiatry and a severe critic of the standard late-intervention systems available to most young people.

As demonstrated by his uncompromising responses to questions about the adverse impacts of immigration detention centres, McGorry is not a person who panders to the short-term political agendas of others.

While his innovative model of youth mental health services has now been widely adopted in North America, Canada, the United Kingdom and Western Europe, sadly, it remains largely neglected in this country.

At one level, this sorry state of affairs can be explained by a combination of poor advice to successive state and national governments, gross under-investment in mental health services and research, bureaucratic and professional resistance to change and perpetuation of the simplistic fee-for-service national financing systems. At another level, it is a more searing indictment of the way in which the Australian health-care system is unable to respond to genuine innovations in the delivery of out-of-hospital services.

Fundamentally, our federal-state health system architecture is incapable of rolling out the style of client-centric health services McGorry has described. While there are innovative programs such as the new Headspace youth services under development, they do represent a fundamental departure from the status quo. In reality, they will not be sustained unless there is a basic shift away from the current funding of on the one hand non-responsive state-based services and on the other private providers who are paid for each service they deliver.

We desperately need funding methods that openly support collaborative care in mental health, and in general health more broadly. We need to entice those community-based clinical and social service providers that respond to the genuine needs of young people to occupy the central ground. Most young people with mental health or substance abuse problems do not need hospital-based systems. They do need access to highly qualified clinical staff early in the course of their illness. Those staff need to be working in active partnership with other general health services and dedicated education and employment services.

Successive state and national governments failed to roll out McGorry’s more specialised early intervention in psychosis models. The Rudd government will repeat this pattern of neglect unless it is prepared to go down reform paths that were well beyond its predecessors. The Australian government would need to directly fund such a national program, oversee its functions and quality at a national level and incorporate the acute care and clinical services currently locked up in the dysfunctional state-based mental health systems.

Additionally, a really brave government would need to confront the aberrant work practices of private providers (notably private psychiatrists and psychologists), the outmoded clinical training approaches of the specialist colleges (psychiatry, physicians and general practice) and other professional groups (notably the Australian Psychological Society and the University sector) and the discriminatory payment systems underpinned by Medicare, the private health insurers and the state governments.

These sweeping reforms cannot be limited to mental health — they have much greater implications for general health reform. In the absence of one national level of health financing, and an ongoing system of national accountability, little real change will be achieved. For most of us, more talk of co-operative federalism in health will leave us languishing where we currently are — namely at 32nd place on the WHO-developed international league table for health system performance.

Tinkering with the current community mental health system or limited enhancements of the community sector (both favoured strategies of previous national and state health ministers) will now not be sufficient. Long-term, large and nationally based investments in new services, service integration and sustained clinical and health services research (long neglected by the NHMRC and the Australian government) are urgently required.

Fortunately, in Pat McGorry, we now have an Australian of the Year who is willing to call a spade a shovel. If the Rudd government drops the ball on health reform, and specifically on mental health reform, we can now expect a more robust and sustained community backlash.

Ian Hickie is executive director of the Brain and Mind Research Institute at the University of Sydney