What the 2026–27 Federal Budget May Mean for Veterans and Their Families

The Budget provides a further $583.4 million to implement Royal Commission recommendations, together with $169.7 million for changes to allied health services used by veterans.

Most of the allied health changes will begin on 1 July 2027. Veterans who regularly receive treatment funded by the Department of Veterans’ Affairs, commonly known as DVA, may benefit from understanding what is expected to change.

Higher fees for allied health providers

From 1 July 2027, DVA will increase the fees paid to allied health professionals who treat Veteran Card holders. The funding will provide $169.7 million over five years, with ongoing funding of $58.8 million each year after that.

The change follows concerns that the current payment rates can make it difficult for some providers to offer treatment under DVA arrangements. Higher fees may encourage more professionals to accept Veteran Cards, which could improve access to services and provide veterans with more choice when looking for an appropriate provider.

The fee increases will apply to a broad range of allied health services such as physiotherapy, psychology, exercise physiology, occupational therapy, podiatry, dietetics, social work and speech therapy. They will not apply to dental, optical or hearing services, or treatment provided by doctors and medical specialists.

Fewer referral renewals

The current Treatment Cycle will also end on 1 July 2027.

Under the present arrangements, an allied health referral generally covers up to 12 appointments or remains valid for 12months, depending on which point is reached first. A veteran may then need to return to their doctor for another referral before treatment can continue.

Once the Treatment Cycle is removed, veterans maybe able to receive more than 12 allied health sessions without needing a new referral simply because the cycle has ended. This change may reduce paperwork, unnecessary medical appointments and avoidable interruptions to ongoing treatment.

A new $5,000 yearly threshold

The Budget will introduce a $5,000 annual threshold for allied health services covered by the new arrangements. The threshold will apply during each financial year from 1 July 2027.

However, reaching $5,000 is not intended to mean that a veteran’s treatment must automatically stop.

DVA has stated that it will be able to fund services above the threshold where there is a demonstrated clinical need. This may be particularly important for veterans with serious injuries, complex conditions or ongoing treatment requirements.

The detailed process for requesting further treatment has not yet been finalised. DVA will consult with veterans, their families, healthcare providers and ex-service organisations about how the new arrangements should operate. Consultation is expected to begin in August 2026.

The $5,000 threshold will not apply to every service funded by DVA and veterans should take care to confirm whether a service is covered.

Treatment while a claim is being decided

The Budget also provides $3.4 million over two years to extend the Provisional Access to Medical Treatment program, known as PAMT, until 31 December 2027.

PAMT allows eligible veterans to access DVA-funded medical and allied health treatment for 20 commonly claimed conditions while they wait for DVA to decide whether it accepts responsibility for their claim.

This can help prevent veterans from having to delay necessary care while their claims are still being assessed.

What should veterans do now?

The main allied health changes will not begin until 1 July 2027.

Veterans who receive regular or higher-cost allied health treatment may find it helpful to keep copies of their referrals, clinical reports and treatment plans. Clear medical records may become important if further treatment needs to be approved after the yearly threshold has been reached.

Veterans and their families should follow future DVA updates and remain informed, as DVA releases more information about the approval process. The practical impact of the changes will become clearer as the new arrangements are developed in consultation with the veteran community.

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This article provides general information only and does not constitute legal advice.

Please do not hesitate to contact Veterans First Legal if you would like to discuss you will and succession planning arrangements.