The Australian federal government has approved an average increase of 4.41% in private health insurance premiums from 1 April 2026.
A media release issued by the Ministry of Health, Ageing and Disability said the approved increase for 2026 is moderately higher than last year’s increase of 3.73% and reflects the rising costs of providing medical and hospital services, which jumped by 5% during the last financial year.
The release said the government will provide A$7.9bn ($5.3bn) this year to Australian policyholders in the form of private health insurance rebates after it reintroduced indexation of the rebate threshold in 2024.
In the 12 months to 30 September 2025, insurers paid out increased benefits of more than A$26.7bn in health, medical and extras benefits.
This year’s premium rise also reflects increasing wage bills and securing the viability of private hospitals. As a result, the hospital benefits ratio increased to 85.9% in September 2025 – up from a low of 83% in 2022-23. It is projected to increase further, to 87% for the 12 months from 1 April 2026.
Australian Health Minister Mark Butler said, “The Government understands the pressure health insurance premium changes put on Australians and decisions about private health insurance premiums must put consumers first.
“This premium round has been guided by my commitment to maintain the value of private health insurance for Australians, while making sure the sector plays its part in supporting private hospitals facing rising costs and significant challenges.”
Mr Butler added, “This year’s decision reinforces that premium increases must be backed by clear evidence and contribute to system-wide improvements, not just insurer balance sheets. Australians deserve transparency, fair pricing and confidence their premiums are being directed where they are needed most.”
“I expect private health insurers and hospitals to work hard to bring down costs and keep future price increases to a minimum.”