Rising rates of Indigenous suicide and self-harm have prompted calls for a new approach to mental healthcare where cultural and clinical care are balanced.

New approaches to mental healthcare have been called for in a report showing rising rates of Indigenous suicide.

The Australian Institute of Health and Welfare has on Tuesday released an update on the progress of Indigenous Australian health.

While there has been progress in some areas such as a reduction in smoking rates and ultimately cardiovascular disease deaths, other areas have gone backwards.

There was a 49 per cent increase in the suicide rate from 2006 to 2018.

The hospitalisation rate for self-harm more than doubled for Indigenous females and increased 81 per cent for males.

AIHW points out that while some areas of mental healthcare have improved, there remains a lack of clinical psychologists in remote areas of Australia.

The report calls for a balance of culturally led and clinical care.

"New approaches are needed that acknowledge disempowerment, cultural losses, racism, and how the cumulative, stressful effect of entrenched poverty and disadvantage adversely affect Indigenous mental health," the report says.

"Key responses needed are the healing of trauma in a culturally appropriate context in a way that includes families and communities as well as individuals."

Telehealth is flagged as an option but the report also notes the lack of accessible and affordable internet in some areas, as highlighted by the coronavirus pandemic.

AIHW spokesman Fadwa Al-Yaman says changes are needed outside of the health sector for improvements to occur.

"Achieving better health outcomes requires a whole-of-government approach, working in partnership with Aboriginal and Torres Strait Islander people," Dr Al-Yaman said.

Mental health and substance use disorders are responsible for 14 per cent of the gap with non-Indigenous Australians.

Three out of 10 people who needed healthcare in 2017 to 2018 didn't get it, with barriers including cost, unavailable services as well as travel distance and waiting times.

The employment rate for Indigenous people aged between 15 to 64 didn't change over the decade to 2018, staying at just under half.

The update also shows the number of Aboriginal and Torres Strait Islander children in out-of-home care and the adult imprisonment rate has increased.

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