The NSW Auditor-General says not enough is being done to provide indigenous people in NSW with adequate mental health care before they end up in hospital.

More needs to be done to provide indigenous people in NSW with adequate mental health care before they end up at crisis point in hospital, the state's auditor-general has found.

The auditor was tasPoor ked with assessing the effectiveness of NSW Health's planning and coordination of mental health services for indigenous patients.

"NSW Health is not targeting sufficient resources to support Aboriginal mental health patients to stay well at home and avoid hospitalisation," Margaret Crawford wrote in the report handed down on Thursday.

The report said Aboriginal people are over-represented in mental health-related emergency department presentations, despite making up just under three per cent of the state's population.

As well, across the state, they account for 11 per cent of presentations, but in rural and regional areas they made up 21 per cent.

Ms Crawford wrote that NSW Health did not have a clear picture of the mental health service use patterns of indigenous people that presented to hospitals at crisis point.

She also noted there was no oversight to ensure community mental health facilities were placed where most needed, and that the last over-arching Aboriginal mental health policy from the department expired almost a decade ago.

Ms Crawford recommended the department improve its data collection on patterns of mental health service use, and implement an Aboriginal mental health policy framework.