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Objectives: To review the effectiveness of chronic disease management interventions for physical health problems in the primary care setting, and to identify policy options for implementing successful interventions in Australian primary care. Methods: We conducted a systematic review with qualitative data synthesis, using the Chronic Care Model as a framework for analysis between January 1990 and February 2006. Interventions were classified according to which elements were addressed: community resources, health care organisation, self-management support, delivery system design, decision support and/or clinical information systems. Our major findings were discussed with policymakers and key stakeholders in relation to current and emerging health policy in Australia. Results: The interventions most likely to be effective in the context of Australian primary care were engaging primary care in self-management support through education and training for general practitioners and practice nurses, and including self-management support in care plans linked to multidisciplinary team support. The current Practice Incentives Payment and Service Incentives Payment programs could be improved and simplified to encourage guideline-based chronic disease management, integrating incentives so that individual patients are not managed as if they had a series of separate chronic diseases. The use of chronic disease registers should be extended across a range of chronic illnesses and used to facilitate audit for quality improvement. Training should focus on clear roles and responsibilities of the team members. Conclusion: The Chronic Care Model provides a useful framework for understanding the impact of chronic disease management interventions and highlights the gaps in evidence. Consultation with stakeholders and policymakers is valuable in shaping policy options to support the implementation of the National Chronic Disease Strategy in primary care.