Private health insurers to resume paying single room rates

Private health insurers will resume paying single room rates when their members use the public system, the NSW Government has announced.

The announcement follows months of negotiations, with all 53 private health funds in NSW set to pay single room rates from 1 January 2025.

This means the state government will not need to increase the health insurance levy (HIL) in order to recover costs. The decision of some funds to stop paying the single room rate had been costing the public health system $140 million a year.

The state government passed legislation in October, mirroring the approach taken by then-Treasurer Mike Baird when private health funds first stopped paying the correct room rate in 2013.

The legislation allowed for the government to cost recover through an increase to the HIL, which could be enacted if funds did not resume paying the single room rate.

The government said it will continue working with insurers on improved data sharing to increase transparency for private patients who use single rooms in the public system.

NSW Health Minister Ryan Park said, “This agreement means private funds resume paying their fair share and our public hospitals are better off.

“We said we’d work with funds to resolve this and that’s what we did.”

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