Older Australians could pay up to $410 more a year for top health cover under proposed cuts to the private health insurance rebate, according to our analysis.
The government last week announced plans to reduce the private health insurance discount by 4 percentage points for those aged 65-69 and by 8 percentage points for those aged 70 and over.
Proposed changes | |||
|---|---|---|---|
Max rebate | Proposed | Change | |
70 and | 32% | 24% | -8% pts |
65-69 | 28% | 24% | -4% pts |
Under 69 | 24% | 24% | No change |
Source: Minister for Health and Ageing, ATO. Rounded to the nearest percentage. Rebate amounts are for base tier incomes of $101k or less for singles and $202,000 or less for families. Rebate rates effective from 1 April 2026 to 30 June 2026.
Our analysis shows the proposed rebate cuts would add approximately $205 to the average Gold-tier hospital policy for Australians aged 65-69 and $410 annually for those aged 70 years or more. This is based on the assumption they are earning $101,000 or less.
For those with hospital and extras, the price hikes would be even higher as the rebate applies to both.
Proposed increase | ||
|---|---|---|
Age | Age | |
Gold | +$205 | +$410 |
Silver | +$93 | +$186 |
Bronze | +$66 | +$132 |
Basic | +$53 | +$105 |
Source: Canstar. Based on the avg cost of individual hospital insurance policies on Canstar’s database, excluding plus tiers. National average based on state averages weighted by proportion of hospital insured persons (APRA).
Rebate changes an extra hit on top of 1 April hospital insurance price hikes
The changes, if passed by parliament, would come on top of April premium increases, meaning some older Australians could face a double hit to their health cover costs.
When stacked with April premium increases, Australians aged 70 and over, earning $101,000 or less, could face total annual rises of up to $815.
Total increase: | |||
|---|---|---|---|
Hospital | April | Impact of | Total |
Gold | +$405 | +$410 | +$815 |
Silver | +$76 | +$186 | +$262 |
Bronze | +$26 | +$132 | +$158 |
Basic | +$31 | +$105 | +$136 |
Source: Canstar. Based on individual hospital insurance policies on Canstar’s database, excluding plus tiers. Base tier ($101k or less) government rebate for age 70 and over has been applied. Averages based on state averages, weighted by proportion of hospital insured persons (APRA).
How to combat the higher cost of cover
- Check your rebate tier: The rebate is based on age and income, so make sure your income estimate is still correct. If your income has reduced, you could be entitled to a higher rebate.
- Compare your policy regularly: Your health needs can change over time. At Canstar, you can compare your options online or speak with someone over the phone.
- Review your excess: Choosing a higher excess can reduce your premium. Just make sure it’s an amount you could comfortably afford if you needed to make a claim.
- Ask your provider for a better deal: You can negotiate with your health provider. A quick call at any time could unlock discounts of up to 12%.
Canstar’s Data Insights Director, Sally Tindall, says, “These proposed rebate changes could hit older Australians’ hip pockets at a time when the April price hikes have just landed in many people’s bank accounts.”
“It’s a potential double whammy that many older Australians won’t be able to afford, particularly those on modest fixed incomes. Some may even be forced to reconsider the level of cover they hold.
“If that’s you, stop and compare your options before you downgrade your cover, because once you do, you’ll have to re-serve any waiting periods if you decide to upgrade in the future.
“Comparing your options, and switching to a cheaper insurer offering the same level of hospital cover could be the price relief you need without having to sacrifice on what you’re insured for.”
