Military Rehabilitation and Compensation Amendment (Veterans' Allied Health Care) Bill 2026
Senator KOVACIC (New South Wales) (15:51): I move: That this bill be now read a second time. I seek leave to table an explanatory memorandum relating to the bill. Leave granted.
Senator KOVACIC: I table the explanatory memorandum. I seek leave to have the second reading speech incorporated in Hansard. Leave granted.
The speech read as follows— This bill rests on a simple principle—that a Veteran's health care should be determined by clinical need, not by an arbitrary dollar figure. In the 2026-27 Budget, the Albanese Labor government announced a $5,000 annual monetary limit on Department of Veterans' Affairs funded allied health care from 1 July 2027. DVA's own material called it what it was "a cap".
Veterans requiring care above $5,000 would need to apply for additional funding. After veterans, families, providers and advocates raised the alarm, on the 31st of August, the language changed. The cap was no longer an "annual monetary limit", it had now become a "review threshold".
Changing the words does not change the effect. When a veteran approaches a $5,000 spend on allied health, the Government proposes yet another approval process. The allied health provider would prepare a treatment request.
The veteran's usual GP would review the proposal. And then it would be up for DVA to decide whether care above the threshold would be funded. Our Veterans deserve a guarantee, in law, that they will not be the ones to suffer to fix Labor's budget.
If, as Labor claims, the $5,000 is only an administrative marker with no effect on treatment, there is no reason for it to trigger additional approval. If it is designed to reduce care, or to save money, the Government should say so. The Budget papers expose this in black and white.
The Government is investing $169.7 million over five years to lift allied health provider fees, and this increase is overdue and supported. For too long, inadequate DVA fees have made it harder for practitioners, particularly in regional Australia, to continue treating Veteran Card holders. Yet the Government paired this investment with savings of $748 million over three years from the "Annual Monetary Limit" or cap, followed by $340.2 million every year on an ongoing basis.
Those figures are not the footprint of a harmless administrative check, they show the measure is expected to materially reduce expenditure on Veterans' allied health care. DVA estimates around one in ten Veteran Card holders may exceed the threshold after provider fees increase. These are not necessarily people receiving inappropriate care.
They are Veterans living with complex and chronic service related conditions. A Veteran may need physiotherapy and psychology, exercise physiology and podiatry, occupational therapy or speech pathology. Everyone understands that many will reach $5,000 quickly, especially once fees rise.
The consequences will be felt especially in regional, rural and remote communities. Veterans outside the capitals already face fewer participating providers, longer travel distances and limited alternatives when a clinician closes their books or stops accepting DVA rates. An extra approval process is not a minor inconvenience when the next suitable provider may be hours away.
An interruption in treatment can mean lost mobility, unmanaged pain, deteriorating mental health and a much harder road back to independence. This bill does not oppose clinical oversight. It does not protect fraud, duplication, unsafe treatment or inappropriate servicing and DVA must be able to act where there is genuine evidence of those things.
This bill rejects using expenditure as a proxy for clinical need. The bill prevents the Veterans' treatment framework from imposing a cap on the total cost of allied health treatment provided over a week, month, year or any other period. It prevents a Veteran being required to pay a co-contribution or gap.
It also prevents additional review, evidence or paperwork being demanded solely or substantially because aggregate expenditure is approaching, has reached or exceeded, or is likely to reach or exceed a specified amount, and it prevents treatment being delayed, suspended, discontinued or refused for the same expenditure-based reason. The protections extend across the principal statutory pathways under which Veterans receive treatment or compensation for treatment.
The definition of allied health in this Bill is inclusive so that the protection is not defeated because a recognised profession is omitted from a closed list or because services evolve over time. The Senate has already demonstrated that this principle commands support as demonstrated by the Senate agreeing to amendments to the Statute Update Bill 2026 protecting Veterans' allied health care from expenditure caps and expenditure-triggered barriers.
This bill is dedicated to providing a durable vehicle to place that protection squarely in the Veterans' treatment framework. There should be no aggregate monetary cap, and no additional review or evidentiary hurdle triggered solely or substantially by expenditure. The Government still has time to abandon the measure.
The detailed arrangements have not been finalised and consultation is underway, however this is the right time for the Parliament to establish a statutory guardrail before Veterans and providers are forced to reorganise care around a policy intended to extract hundreds of millions of dollars in savings. Our nation asks extraordinary things of the men and women who serve it.
When service leaves a person with injury or illness, the Commonwealth's obligation is not discharged when an app or accounting system reaches $5,000. Veterans should not have to watch a running total and wonder whether their next appointment will trigger another approval process. Their clinicians should not have to plan care around a budget threshold and regional Veterans should not bear an even heavier burden simply because alternatives are scarce.
Clinical need must come first. I commend the bill. Senator KOVACIC: I seek leave to continue my remarks later.
Leave granted; debate adjourned.