State and territory leaders are no closer to addressing the $80 billion gap in federal funding for health and education, as tax reform options remain open to investigation.

Premiers and chief ministers are facing a March deadline for agreement on tax reform, which they are hoping can address funding shortfalls in the health system.

Queensland Premier Annastacia Palaszczuk described it as the nation's "number one priority" following discussions with Prime Minister Malcolm Turnbull in Sydney today.

"The single-most important issue to families out there is the rising cost of health care," Ms Palaszczuk said.

"The modelling must be presented at that next meeting. There must be a clear path forward about how we are going to address this fundamental issue for families across our nation."

But NSW Premier Mike Baird said an interim solution may be necessary, "if we can't get there in the long term".

Victorian Premier Daniel Andrews said fellow COAG leaders would strive to come to an agreement over health funding in coming months.

"I don't think we can overstate just how important an agreement that is," Mr Andrews said.

"The acknowledgment as well that this is our number one challenge and it's one that each and every one of us must step up and properly respond to."

Mr Turnbull told reporters that no consensus had been reached in regards to a "path forward" on tax reform.

State and territory Labor leaders have previously stated that they would not stand in the way of a Goods and Services Tax hike if the Federal Government took it to an election and won a mandate.

COAG leaders also noted work on medicinal cannabis and agreed to an update at their next meeting.