Australians who live in regional and remote areas are getting sicker more often and waiting longer to see a doctor than their city counterparts, a study has found.

While the health of Australians is improving in many areas, there is still a big gap based on where you live, according to the latest report on healthcare from the Council of Australian Governments reform council.

It shows the rate of potentially preventable hospital admissions due to chronic illness in very remote areas was almost 2.5 times that of big cities.

About one in three people living outside cities reported longer than acceptable waiting times to see a GP. A year earlier, those numbers were about one in five.

There are also increases across the board in waiting times to see medical specialists.

Incentives to get doctors to move to remote areas were inadequate, the Rural Doctors Association of Australia said.

The Australian Institute of Health and Welfare 2008 report found the number of medical practitioners was rising, but not in the right places. At the time of the report there were 335 doctors per 100,000 in big cities, compared with just 135 in very remote Australia.

Small town doctors often act in several capacities - as the local GP, a hospital's visiting medical officer (VMO) and the after-hours responder. It's a big job with no extra support or return, says former president of the rural doctors association, Dr Paul Mara.

"If you can get paid far more by being a specialist or by being an emergency medicine specialist and not having to work the hours... then why would you want to go and work in those areas where the responsibility is arguably much higher and the workload is much higher?" he said.

The government provides incentive payments for doctors to go to regional areas, but the current classification process was hugely flawed, Mara said.

"The government classifies Moree the same as Townsville. The doctors in Moree are working 24 hours a day, seven days a week, providing hospital-based services, and high-risk, high-responsibility, very intensive services," Mara said.

"And they're getting the same incentive-based pay as the doctors in Townsville are."

The government has agreed to a new classification scheme which should improve the distribution of incentive payments for rural doctors, health minister Tanya Plibersek announced last Friday. The payments received a $20 million increase in the federal budget.

Plibersek's announcement also included an agreement to develop the rural training pathway for medical graduates.

Charles Sturt University in Bathurst, NSW, is hoping to open two medical schools in the regional centres of Wagga Wagga and Orange. The two schools would train up to 80 doctors, in the hope that doctors who train in rural areas will stay there to practise.

The university already offers other health disciplines, and statistics from these courses strongly suggested the location of training influenced the decision of where to work, said CSU's director of corporate affairs Mark Burdack.

"More than 70% of our on-campus health students are from rural areas, and more than 80% of those go back to rural employment," he said.

Big city universities took on about 20% of their medical students from rural areas, but only about 10% returned to rural practice, Burdack said.

"People in rural areas have high levels of chronic disease and that's a direct result of people not getting access to primary health care services like GPs who can identify emerging conditions early on and take measures to reduce the likelihood of that becoming a chronic disease down the track," he said.

Medical courses are the only tertiary education courses for which universities are required to gain federal approval, as the government seeks to manage the medical workforce through the number of students.

But the Australian Medical Association opposes the bid for the new regional schools, voicing "deep concerns" about the effect they would have on the shortage of medical training places, as those places are paid for and provided by the department of health, not universities.

Dr Will Milford, chairman of the AMA's Council of Doctors in Training, told Guardian Australia there was "good evidence" that rural clinical schools were part of the solution to the regional doctor crisis, but funding just one fragment of the medical training pipeline would create bottlenecks in other areas - such as internships.

"Until sufficient funding exists to train current graduates of medical schools, we are opposed to the opening of new medical schools," Milford said. "There's no point having a rural clinical school unless you can commit to training everyone that graduates from it, and as yet we haven't that seen that sort of commitment."