But what has made matters even more delicate for Health Minister Sussan Ley is that the founder and owner of Primary Health Care is Edmund Bateman, a BRW rich-lister and at times the biggest individual donor to the Liberal Party. The medico mogul, who built an empire of 71 medical centres and more than 250 pathology labs and imaging centres, has regularly donated up to $250,000 a year to the Liberals, reports say. With the trademark dispute up in the air, 31 government-run medical offices across Australia have been told to operate under the acronym "PHN" rather than the longer Primary Health Network. An email sent to bosses at Medicare Locals on Monday night – less than 48 hours before their July 1 launch – addresses confusion over "naming and branding issues". "As you may be aware, there is currently litigation in the Federal Court by Primary Health Care Ltd in relation to its trademark applications to register the terms 'Primary Health Care' and 'Primary Health Care Limited'," wrote Sharon Appleyard, assistant secretary, Primary Health Networks Branch.

"In addition, Primary Health Network Pty Ltd, a subsidiary of Primary Health Care Ltd, has recently applied to register the trademark 'Primary Health Network'. With this in mind, if you choose to use 'primary health network' in your name you should seek independent legal advice. "The Department of Health expects that from 1 July 2015 you will refer to the name of your PHN in any communications as a combination of the geographical location and the term 'PHN'. We request that in the meantime any expenditure on signage is not undertaken and that production of stationery, reports and promotional material is minimised until the department provides its advice on branding." Within hours one of the Medicare Locals in Tasmania alerted clients that its website would be suspended on July 1 until the "Australian government advises of branding to be applied". PHNs have had a troubled start. During a leader's debate with Kevin Rudd, the then opposition leader Tony Abbott contradicted previous equivocal statements by his health spokesman, Peter Dutton, to insist: "We are not shutting any Medical Locals". But after a post-election review, conducted by former Commonwealth chief medical officer John Horvath, the government decided to scrap 61 Medicare Locals and replace them with 31 PHNs, aligned with state-run hospitals.

The offices, which once employed about 3000 people but will shrink under the new, smaller system, handle some purchasing functions and co-ordinate front-line health services in areas and spearhead programs like targeted pushes to reduce smoking and diabetes rates in high-risk areas. Ms Ley's office on Tuesday referred questions to the Health Department. In a statement, the Health Department said: "Advice has been provided to PHNs in relation to naming. Development and branding guidelines are currently under way and PHNs will be advised as soon as they are available." Opposition health spokeswoman Catherine King said: "This is a complete debacle. "The Abbott government has wasted over $100 million on this process, and can't even get the name right, This has been a bungled at every step of the way.

"The tenders were badly delayed, then rewritten at the last minute, and even this month, many were not finalised. And now, 36 hours before the system is supposed to start, they can't even use the name." A spokeswoman for Primary Health Care Ltd declined to comment. The government's Medicare rebate freeze begins on July 1. It is forecast to save the Commonwealth $1.3 billion over fours years but the Australian Medical Association has warned it will force some doctors to stop bulk billing and recoup an extra $8 per visit from patients by 2018.