It is ‘hard to see’ how the Coalition would ever back the bill, said the Opposition health spokesperson.
The fate of the government’s $3 billion private health insurance rebate cut now sits “firmly in the court of the Australian Greens”, according to shadow health minister Senator Anne Ruston, who says the Coalition has been in direct talks with Greens senators about the legislation.
Senator Ruston told The Medical Republic‘s sister publication Health Services Daily today that she remained “very, very hopeful” that the Private Health Insurance Amendment (Modernising the Private Health Insurance Rebate) Bill 2026 could be stopped after both the Coalition and Greens dissented from a Senate committee report recommending it be passed unchanged.
“The ball sits firmly in the court of the Australian Greens,” she said.
“I would be incredibly surprised and incredibly disappointed if the Australian Greens did not stand by the potentially 1.5 million pensioners who are going to be impacted by this.”
Senator Ruston confirmed the Coalition had spoken directly to the Greens about the legislation.
“We’ve spoken a lot of times to the Greens, and I think there is a great concern amongst most of the members of the Greens that I’ve spoken to, including Jordon Steele-John and Penny Allman-Payne, that the government has completely and utterly misread the impact it’s likely to have on lower-income older Australians, particularly pensioners,” she said.
The Greens’ dissenting report stopped short of committing the party to voting against the legislation, instead saying it had “serious concerns about the Bill in its current form”.
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Senator Ruston said it remained to be seen whether the government could negotiate amendments that would make the legislation acceptable to the Greens.
However, she said it was “hard to see” any amendments that would persuade the Coalition to support the bill.
“We think it’s a complete false economy,” she said.
“It’s just basically a cost shift from the federal government to the states and territories. It’s nothing more.
“Quite frankly, no matter which way you cut and dice this bill, there seems to be no way you could turn it into a net positive. You just can’t.”
The political fight comes as new government data show Australians are already moving away from top-tier private hospital cover towards cheaper policies and higher excesses, amid scrutiny of the government’s failure to model how many older Australians will downgrade their insurance under the planned rebate changes.
Department of Health, Disability and Ageing private health insurance data show the total number of hospital treatment policies increased from 6.13 million in June 2025 to 6.27 million in June 2026, an increase of about 2.2%.
But the number of Gold hospital policies fell by almost 118,000 over the same period, from 1.86 million to 1.74 million – a fall of 6.3%.
Silver policies increased by about 126,000 to 2.41 million, Bronze policies rose by almost 92,000 to 1.41 million, and Basic policies increased by about 37,000 to 716,000.
There has also been a sharp increase in policies carrying the highest standard excess.
The number of hospital policies with a $750 individual or $1500 couple/family excess increased from about 1.16 million in June 2025 to almost 1.4 million in June this year – an increase of about 21%.
At the same time, the number of policies with no excess fell from about 806,000 to 756,000.
The data do not establish why consumers are changing their level of cover or excess, but the shift towards lower tiers and higher excesses comes as the government faces criticism for failing to model how its rebate changes could affect the type of cover held by older Australians.
Senator Ruston described that omission as “really shameful”.
“They didn’t even bother to model the number of people who are likely to downgrade,” she said.
“All they came up with was a number of what they believe would be the number of people who would drop their private health insurance altogether, and we know most likely initial response will be downgrading.”
The bill would remove the additional age-based rebate currently available to people aged 65 and over from 1 April 2027, while retaining income testing.
Around 3.2 million older Australians are expected to be affected, with the government estimating an average additional premium cost of about $250 a year.
New survey results from COTA Australia have meanwhile found one in three older Australians surveyed said they would cancel or change their private health insurance if the additional age-based rebate was removed.
The survey of 1332 COTA Australia supporters aged over 65 found almost half would keep their existing cover, including 34.2% who said their most likely response would be to cut spending elsewhere to afford it.
Asked where they would consider cutting spending if they retained their insurance and premiums increased, 54.7% nominated at least one health or aged-care expense, 41.2% nominated food or groceries and 26.3% nominated energy costs.
More than two-thirds – 68.1% – said they would consider reducing social activities or interactions, while just 6.8% said they would not cut spending elsewhere.
COTA Australia chief executive Patricia Sparrow said retaining private health insurance should not be mistaken for being able to afford higher premiums.
“Older people are telling us they want to keep their private health insurance, but many are looking at some incredibly difficult sacrifices to do so,” Ms Sparrow said.
“People should not have to cut back on groceries, medicines, dental care, physiotherapy, GP appointments, or their power bills, just to find the money to keep their health insurance.
“Our survey’s evidence that some older people could be forced to choose between one essential and another is just devastating.”
The findings add to questions over a gap in the government’s modelling of the impact of removing the age-based rebate.
Departmental modelling predicts about 44,000 fewer older Australians will hold private health insurance by 2028-29 than would have done so if the existing rebate arrangements remained.
However, the government’s Impact Analysis modelled the number of people expected to abandon private health insurance completely, rather than how many might remain insured but downgrade their level of cover.
Coalition senators seized on the omission in their dissenting report to the Senate inquiry into the bill, saying the analysis “failed to analyse the number of older Australians who would downgrade their cover and, therefore, the consequences of those downgrades”.
They pointed to modelling by Catholic Health Australia estimating one in five affected people aged over 65 would change their level of cover.
“Catholic Health Australia, which undertook its own substantial modelling, estimated one in five affected over-65s will change their level of cover, vastly more than the one-in-75 assumed by the Government, with about 665,000 downgrades to occur over the first three years of full operation,” the Coalition dissenting report said.
The Greens have also raised the prospect of people downgrading their insurance, with health spokesperson Senator Jordon Steele-John today saying higher costs could force people to drop or reduce their cover.
“The committee heard that higher private health insurance costs could force people to drop their cover or downgrade it,” Senator Steele-John said.
“That means more people could end up relying on public hospitals, which are already under the pump and have long waiting lists.”
Greens older people spokesperson Senator Penny Allman-Payne said the additional cost could be “back-breaking” for pensioners and part-pensioners.
“Older people across Australia are already forced to make impossible choices about groceries, heating and cooling, medicines and other essentials,” she said.
“Driving up the cost of their private health insurance is just another kick in the guts that could have devastating consequences for their health, independence and quality of life.”
The Labor-led Senate committee recommended the bill be passed unchanged, saying departmental modelling showed private health insurance participation would continue to grow despite the changes, although more slowly than under existing rebate arrangements.
The bill is expected to save the Commonwealth almost $3 billion, with the government arguing the savings will help fund aged-care reforms and ultimately relieve pressure on public hospitals by addressing delayed discharge.
