Mowbray Medical is turning away more than 20 patients a day and is no longer offering mixed billing, as the result of what it claims has been a "persistent lack of government support".
One of only two health centres servicing Launceston's northern suburbs, the practice ceased offering mixed billing payments from June 1.
Practice manager Jo Bean said the change came after months of uncertainty around federal funding models, resulting in the service no longer being viable.
"There was a lot of hesitation around the changes coming through from the government, which they weren't being clear about," she said.
"We just couldn't wait and see what those changes were and what that would mean for us.
"We had to sit down and reconsider how things were to pan out in the future, to enable us to look after the community up here moving forward, and the best way we could do that and still be a viable business."
Mixed billing practices offer medical consultations and examinations for a set fee, with a percentage of patients to be bulk billed.
Previously, Mowbray Medical offered bulk billing to all concession card holders across the board.
However, bulk billing is now only available for children under 16, pensioners aged 65 and older, care plans for patients with chronic conditions and Medicare approved health assessments.
With one full-time GP and two part-time registras, the practice reached capacity with just over 3500 patients active on its database, and is no longer accepting new patients.
It has also been trying to recruit an additional GP, with no success.
Ms Bean said the centre felt pressured into the changes, despite engaging with state and federal politicians.
"Unfortunately we felt forced, by not being able to get a doctor and the limited support," she said.
"We had to make a decision ... but it wasn't the nicest decision to make."
Ms Bean said when she raised the issues with then health minister Michael Ferguson, he suggested sending additional patients to the emergency department.
"One of his solutions was, 'you could just send them to the hospital'," she said.
"But do you know what it costs the government to see a patient through DEM, as opposed to supporting and seeing a person through a medical centre. That was just ridiculous."
Bass Liberal MHR Bridget Archer, who met with Ms Bean in June, said she was addressing the concerns and those raised by other GPs - including working with federal Health Minister Greg Hunt ahead of an upcoming Tasmanian visit.
"A forum where the minister can meet with Mowbray Medical and others in the health field to discuss the issues they are facing is on the table as part of the proposed visit," she said.
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