New data reveals that health insurers disbursed a record $9.4 billion for hospital claims exceeding $10,000 in 2024. According to the 2025 Annual Hospital High Claims Report, the number of such claims reached 453,259, marking a significant increase of 10%, or 40,771 more claims than the previous year. This surge highlights the growing financial burden of hospital care on health funds, with high claims constituting more than half (50.4%) of all hospital benefits paid out in the year.
Mental Health and Young Adults Drive High Claims
Among the notable trends, claims related to mental health services saw a 13% increase for individuals aged 65 and older, totaling 6,816 claims. This category accounted for $147.7 million in benefits, with depressive disorders being the most common reason for these claims. Additionally, young adults under the age of 30 experienced 22,032 claims exceeding $10,000, a rise of 3.4% from 2023 and 13% compared to pre-pandemic levels in 2019.
Neonatal care emerged as another significant contributor to high claims, with health insurers disbursing $43.3 million for newborns requiring extensive treatment. Notably, one in three high claims for individuals aged 18 to 30 involved mental health treatment, with 70% of those claims attributed to female patients. The average hospital stay for these episodes was 26 days, underscoring the serious nature of the conditions treated.
Serious Health Conditions Lead to Massive Claims
The report also highlights that over 1,000 patients were hospitalized for serious conditions, resulting in claims exceeding $100,000 each. These conditions included coronary artery disease, severe infections, cancers, diabetes, schizophrenia, and complications from spinal fusions. One particularly striking case involved a patient whose hospital treatment for severe mitral valve disease culminated in a claim of $697,267. This patient spent 2.7 months in hospital care, requiring a tracheostomy and ventilation support due to complications.
Dr. Rachel David, CEO of the Private Health Insurance Association (PHA), commented on the report, emphasizing the vital role that private health insurance plays in providing essential care. “The record amount paid out for members’ hospital high claims highlights the real and tangible value members are receiving from their private health cover when they or their loved ones need it most,” Dr. David stated.
She further noted that this financial support alleviates considerable pressure from the public health system, enabling more Australians to access timely care. The continued growth in health fund membership reflects the increasing recognition of the benefits of private health coverage in Australia.
Hospital claims are categorized as ‘high’ when the total insurer benefit for a hospital episode exceeds $10,000. The 2025 Annual Hospital High Claims Report utilizes anonymized data from PHA member funds, detailing hospital claims paid for Australians with health insurance. This report offers insights into the demographics of claimants, including gender, age group, duration of hospital stays, and whether care was received in public or private facilities.
