Five District Health Boards are being given a push to merge some of their Primary Health Organisations (PHOs) and one has decided to scrap its only PHO altogether.
Mr Ryall criticised the 81 PHOs last year, saying there were too many bureaucrats and since then several have merged together.
Four PHOs catered to 30 percent of the population, while at the other end of the scale 41 looked after 12 percent.
PHOs are independent organisations funded by district health boards to provide primary health care services and the Government uses them to roll out subsidised services.
Mr Ryall told NZPA today he wrote to five DHBs that had not made the progress he wanted.
"I have written to these five DHB chairs to say 'can you start working with these PHOs to get them consolidated'?"
Waitemata (six PHOs), Auckland, which covers the central city (five), Northland (six), Capital Coast Health in Wellington (seven) and Hutt Valley (five) were in his sights.
Mr Ryall said some PHOs served only 4000 people while others had 300,000 on their books.
"They've got huge variation in size... The Government is saying that in primary care, as in anywhere else in the health service we need to move resources to the front line and unnecessary bureaucratic structures need to go."
He said he had visited an area where there were four PHOs operating in a relatively small community.
As the push came to find savings it was also announced that South Canterbury DHB with only one PHO in its area would be replaced by a new model.
South Canterbury decided to close down the Aoraki PHO after a number of GPs said they had lost confidence in the organisation.
A local advisory board told the DHB it would be best to set up new primary care and community services as an operating unit of the DHB and not an independent organisation.
Consultation with the community and health professionals still had to take place but the DHB chief executive said the idea had significant merit considering the area's small population.
Mr Ryall said the PHOs needed money in the budget just to keep subsidies increased to meet inflation and the money needed to be found.
In Otago-Southland nine PHOs were being merged into one and in eastern Bay of Plenty three had merged into one.
Labour's health spokeswoman Ruth Dyson said she was surprised at the letter from Mr Ryall pushing mergers on local communities but was supportive of changes where they were supported by the community.
The South Canterbury proposal had good points but would need wide input.
"The potential downside of a proposal like this is it goes back to the old days of focussing primary health care just through GPs." Ms Dyson said.
"Of course it would be really good to make sure that GPs' fees are kept down and any transfer of secondary services from the hospital to GPs, which is implied, remains free. At the moment you can go to the hospital and get a free (treatment). If that service is transferred from the Timaru hospital to the local GP will people in Timaru still be able to get that service free? In my view they have to."
Meanwhile, 24 senior doctors have written an open letter protesting at the lack of consultation over plans to merge the Otago and Southland District Health Boards.
The doctors said they had serious concerns about the plans which were announced last November.
NZPA