This bill is currently before Parliament.
Health, care & disability
People aged 70 and over on the lowest incomes would lose their age-based bonus.
The government says the private health insurance rebateGovernment help with private insurance premiums. — public help with insurance premiums — costs about $7.9 billion in 2025-26. It argues that older people receive more help than younger people on the same income, although older people are more likely to keep their insurance. The change is expected to reduce government spending by $2,994.7 million over four years. The government says these savings would support aged-care beds, home-care places and dementia services.
Australia’s private health insurance rebateGovernment help with private insurance premiums. had largely kept its age-based structure since higher payments for people aged 65 and over were introduced in 2004, within a community-rated system where younger members help cross-subsidise older members’ claims. In 2026 the government argued the extra subsidy was poorly targeted and announced this Bill to equalise rebates by income from 1 April 2027, a change expected to raise premiums for many older people while redirecting about $3 billion over four years to aged-care services.
The evidence pack contains no opposing speech or named opposition criticism. The government’s own analysis warns that some older people may drop or reduce their cover, lose their choice of specialist and face longer public-hospital waits. It also says private insurers and hospitals could lose some business.
Mark Butler MP introduced this bill. Supportive speeches so far have come from Labor.
Did it become law?
Not yet
Final passage
No final vote yet
The bill has not yet completed passage through Parliament.
Days since introduction
43 days
Updated 07 Aug 2026.
Meaning
People aged 70 and over on the lowest incomes would lose their age-based bonus. Their rebate would fall from about 32% to about 24%.
People aged 65 to 69 on the lowest incomes would also lose their age-based bonus. Their rebate would fall from about 28% to about 24%.
People of every age would receive the same rebate when their incomes match. Lower-income members would still receive a higher rebate than higher-income members.
Older policyholders would still receive rebates of up to 24% and pay the same policy price as younger members before rebates.
People paying for cover from 1 April 2027 would use the new rates. This includes rebates received through insurers or later through tax.
Older Australians with affected cover could pay about $250 more each year on average. Around 3.2 million people are expected to be affected.
Younger Australians would no longer need an age-discrimination exception covering the higher rebates previously given to older members.
1 Paragraphs 22‑15(1)(b) and (c) Repeal the paragraphs, substitute: (b) in respect of any days in the premium period to which paragraph (a) does not apply—the percentage of the amount of the premium, or of the amount in respect of a premium, paid or payable in respect of those days worked out as if they were days to which paragraph (a) applied. Note: Paragraph (b) means that the age of a person insured under the policy does not affect the percentage that applies in working out the PHIIB’s share of the PHII benefit.Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) introduced text
1 Paragraphs 22‑15(1)(b) and (c) Repeal the paragraphs, substitute: (b) in respect of any days in the premium period to which paragraph (a) does not apply—the percentage of the amount of the premium, or of the amount in respect of a premium, paid or payable in respect of those days worked out as if they were days to which paragraph (a) applied. Note: Paragraph (b) means that the age of a person insured under the policy does not affect the percentage that applies in working out the PHIIB’s share of the PHII benefit.Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) introduced text
1 Paragraphs 22‑15(1)(b) and (c) Repeal the paragraphs, substitute: (b) in respect of any days in the premium period to which paragraph (a) does not apply—the percentage of the amount of the premium, or of the amount in respect of a premium, paid or payable in respect of those days worked out as if they were days to which paragraph (a) applied. Note: Paragraph (b) means that the age of a person insured under the policy does not affect the percentage that applies in working out the PHIIB’s share of the PHII benefit. 2 Subsections 22‑15(2), (3) and (4) Omit “each percentage specified in subPrivate Health Insurance Amendment (Modernising the Private Health Insurance Rebate) introduced text
The bill will implement the rebate change by amending Part 2-2 of the Private Health Insurance Act 2007 so the rebate calculation applies in the same way for people aged 65 and above as it does for those aged under 65. The bill will also make a technical amendment to the Age Discrimination Act 2004, removing a reference to an exemption previously required for the discriminatory operation of those higher rebates for older Australians, protecting the Commonwealth, as they did at the time, from legal action from younger Australians based on the obvious differential treatment based on age. WhileSecond reading speech
7 Application provision The amendments of the Private Health Insurance Act 2007 made by this Part apply in relation to amounts of premium, and amounts in respect of premium, that are paid on or after 1 April 2027 in respect of days that are on or after that date.Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) introduced text
The change will impact approximately 3.2 million people aged 65 and over who have a taxable income below the rebate cut-off. It's expected the average increased premium for those impacted older Australians will be around $250 per year—or less than $1 per day. For some older Australians who choose more expensive policies, that increase may be higher.Second reading speech
Age Discrimination Act 2004 8 Schedule 2 (table item 9A, column headed “Provision(s)”) Omit “, 22‑25”.Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) introduced text
Context
Australia’s private health insurance rebateGovernment help with private insurance premiums. had largely kept its age-based structure since higher payments for people aged 65 and over were introduced in 2004, within a community-rated system where younger members help cross-subsidise older members’ claims. In 2026 the government argued the extra subsidy was poorly targeted and announced this Bill to equalise rebates by income from 1 April 2027, a change expected to raise premiums for many older people while redirecting about $3 billion over four years to aged-care services.
Higher rebate for older Australians introduced
The Howard government increased private health insurance rebateGovernment help with private insurance premiums. rates for people aged 65 and over, creating the age-based advantage the Bill would later remove.
Hansard ↗Government announces plan to end age-based rebate advantage
Mark Butler announced that older Australians would receive the same income-tested rebate as younger policyholders, with average annual premiumThe price paid for insurance cover. increases estimated at about $240 and 44,000 people expected to leave private cover.
ABC News ↗Older Australians warn of higher premiums and hospital pressure
Older policyholders expressed concern about reduced rebates, while advocates warned that people leaving private insurance could increase pressure on public hospitals.
ABC News ↗Mark Butler MP introduces the bill
Mark Butler MP formally presented the Bill in the House of Representatives and opened its parliamentary consideration.
Parliamentary timeline ↗Equalised rebate rules scheduled to begin
The higher rebate for people aged 65 and over is scheduled to end, leaving rebate rates determined by income while preserving existing income tiers and indexationRegular adjustment to reflect changing prices or wages. and generating expected savings for aged-care services.
Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) explanatory memorandum ↗Legislative route
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
Introduced and read a first time
A minister or sponsoring member moved the second reading, opening the main debate on the bill's purpose and principles.
Second reading moved
Referred to Committee (25/06/2026): Senate Community Affairs Legislation Committee; Report due 07/10/2026
Report due 07 Oct 2026
APH bill page notesKey criticism
The evidence pack contains no opposing speech or named opposition criticism. The government’s own analysis warns that some older people may drop or reduce their cover, lose their choice of specialist and face longer public-hospital waits. It also says private insurers and hospitals could lose some business.
The government estimates about 44,000 fewer people aged 65 and over would be insured by 2028-29 than under current settings. It says this is a 0.4% reduction from the expected level and that the effect on hospital admissions should be small.
Affordability for older Australians
Critics argue that treating older policyholders like younger people ignores why the age-based rebate was introduced: many over-65s are pensioners or live on modest fixed retirement incomes. They warn that higher premiums could push some to downgrade or abandon private cover.
Risk of downgrading cover
Private health insurance industry reporting warned that mounting costs could cause large numbers of Australians to downgrade their policies, adding to concerns about the effect of this change on older members’ ability to retain comprehensive cover.
Further sources
Votes
No recorded votes have been found yet for this bill.
Parliamentary debate
Start here — lead voices
Mark Butler supports the bill, saying it removes an unfair age-based rebate difference while keeping means-tested support and redirecting $3 billion in savings to aged care.
Read in Hansard ↗All speeches by bloc
1 speaker · 1 support
“Although the rebate change is not expected to have a substantial impact on private hospitals, the government does recognise that some private hospitals are experiencing ongoing viability concerns. We are considering a range of reform options identified in consultation with the sector to modernise private health and to better support the public-private health system that has made Australia's health system one of the best in the world. I commend the bill to the House.”Read the full speech in Hansard ↗
Record
House · Introduced and read a first time
Introduced
The bill was formally presented to the chamber and read a first time, which starts its parliamentary journey.
House · Second reading moved
Second reading opened
A minister or sponsoring member moved the second reading, opening the main debate on the bill's purpose and principles.
Senate Community Affairs Legislation Committee
Report due 07 Oct 2026
Referred to Committee (25 June 2026): Senate Community Affairs Legislation Committee; Report due 7 Oct 2026
APH bill page notes