44,000 Australians Over 65 Could Lose Private Health Insurance — What You Need to Know
44,000 Australians Over 65 Could Lose Private Health Insurance — What You Need to Know
A significant change buried in this week’s Federal Budget could affect hundreds of thousands of older Australians with private health insurance. The government has removed the age-based uplift in the private health insurance rebate for people over 65 — and experts are warning the consequences could be serious. Here’s exactly what’s happening, who it affects, and what you should do right now.
What Changed?
For many years Australians over 65 received a higher private health insurance rebate than younger Australians. This recognised that older people use health insurance more and helped make premiums more affordable for retirees on fixed incomes.
The 2026 Federal Budget has removed this age based uplift, bringing the rebate for Australians over 65 in line with the standard 24% rebate received by younger Australians. Facebook
In simple terms — if you’re over 65 and have private health insurance, your government rebate is going down. That means your out of pocket premium cost is going up.
How Many People Are Affected?
The Government expects around 44,000 older Australians to drop their private health insurance as a result of this change. The measure is forecast to save $11 billion from 2025-26 to 2036-37. Facebook
That’s a significant number of people who will decide the increased cost is no longer worth it — and it raises serious questions about what happens to their healthcare access as a result.
How Much Will It Cost You?
The exact impact depends on your current policy, your age, and your income level. However as a general guide:
- People aged 65 to 69 currently receive a 32% rebate — this will drop to 24%
- People aged 70 and over currently receive a 35% rebate — this will drop to 24%
The difference between a 35% rebate and a 24% rebate on a typical couples hospital policy costing $4,000 per year is approximately $440 per year in additional out of pocket costs.
For retirees on fixed incomes this is not a trivial amount.
What Should You Do Right Now?
Step 1 — Find out your current rebate Contact your private health insurer and ask them exactly what rebate you currently receive and what your new premium will be under the changes.
Step 2 — Compare your options Before cancelling your policy or accepting a higher premium use a free comparison tool to check whether a better value policy exists:
Step 3 — Consider your healthcare needs carefully Before dropping private health insurance entirely think carefully about:
- How long is the public hospital waiting list for treatments you might need — joint replacements, cataracts, cardiac procedures
- Do you have ongoing health conditions that benefit from private cover
- What extras cover do you use regularly — dental, optical, physiotherapy
Dropping cover to save money in the short term can be very costly if you need elective surgery and face a long public waiting list.
Step 4 — Talk to a financial adviser If you’re unsure whether private health insurance still makes financial sense for your situation a financial adviser can help you weigh up the costs and benefits in the context of your overall retirement income.
The Bigger Picture
For many retirees this budget has delivered a mixed result. Some measures help with everyday expenses and travel. Others like this change could increase costs for retirees with private health insurance.
The private health insurance change is particularly concerning because it comes at a time when healthcare costs are already rising and many retirees are feeling the pressure of increased living costs across the board. Facebook
The Bottom Line
If you have private health insurance and you’re over 65 you need to take action now — not wait for your renewal notice to arrive. Contact your insurer, understand exactly how the change affects your premium, and compare your options before making any decisions.
The worst thing you can do is either blindly accept a higher premium without shopping around or cancel your cover without fully understanding the consequences.
Share this with every Australian over 65 you know who has private health insurance — this change affects hundreds of thousands of people and most don’t know about it yet. Join The Good Years Club on Facebook for breaking news and information that matters to Australians over 60.
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