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Objective: To evaluate the effectiveness and health costs of a new primary care service delivery model (the Optimising Primary Care Management of Knee Osteoarthritis [PARTNER] model) to improve health outcomes for patients with knee osteoarthritis (OA) compared to usual care. Methods: This study was a 2‐arm, cluster, superiority, randomized controlled trial with randomization at the general practice level, undertaken in Victoria and New South Wales, Australia. We aimed to recruit 44 practices and 572 patients age ≥45 years with knee pain for >3 months. Professional development opportunities on best practice OA care were provided to intervention group general practitioners (GPs). All recruited patients had an initial GP visit to confirm knee OA diagnosis. Control patients continued usual GP care, and intervention patients were referred to a centralized care support team (CST) for 12‐months. Via telehealth, the CST provided OA education and an agreed OA action plan focused on muscle strengthening, physical activity, and weight management. Primary outcomes were patient self‐reported change in knee pain (Numerical Rating Scale [range 0–10; higher score = worse]) and physical function (Knee Injury and Osteoarthritis Outcome Score activities of daily living subscale [range 0–100; higher score = better] at 12 months. Health care cost outcomes included costs of medical visits and prescription medications over the 12‐month period. Results: Recruitment targets were not reached. A total of 38 practices and 217 patients were recruited. The intervention improved pain by 0.8 of 10 points (95% confidence interval [95% CI] 0.2, 1.4) and function by 6.5 of 100 points (95% CI 2.3, 10.7), more than usual care at 12 months. Total costs of medical visits and prescriptions were $3,940 (Australian) for the intervention group versus $4,161 for usual care. This difference was not statistically significant. Conclusion: The PARTNER model improved knee pain and function more than usual GP care. The magnitude of improvement is unlikely to be clinically meaningful for pain but is uncertain for function. [ABSTRACT FROM AUTHOR]