National Cabinet met in Sydney today and reached a landmark agreement to deliver record funding to state and territory hospitals and secure the future of the NDIS.
These reforms will ensure Australians can continue to access world class health care and disability supports.
It prioritises investment in our precious public health system and builds on the Commonwealth’s measures to strengthen Medicare.
Hospital funding
Today’s agreement reaffirms a shared commitment to delivering safe, high-quality health and disability services for all Australians. It is a major step forward in addressing growing pressures on our health and aged care systems and the NDIS, ensuring their sustainable delivery into the future.
As part of this deal, the Commonwealth will provide $25 billion in additional funding for public hospitals. This is three times more additional funding for public hospitals than under the last 5 year agreement. Commonwealth funding for state-run public hospitals will reach a record $219.6 billion from 2026-27 to 2030-31.
The funding includes the Commonwealth share of estimated hospital activity from 2026-27 to 2030-31 of $24.4 billion through the National Health Reform Agreement hospital base funding and over $600 million in further Commonwealth investment in the public hospital system.
The Commonwealth will continue to help states take pressure off their hospitals by delivering 137 Medicare Urgent Care Clinics, record investment to expand the bulk billing incentive for all Australians, 92 Medicare Mental Health Clinics, 1800Medicare, cheaper medicines for every Australian and delivering the best aged care for older Australians.
Disability reforms
National Cabinet has acknowledged the need for continuing reforms to secure the future of the NDIS, ensuring it is sustainable and can continue to provide life changing support to future generations of Australians with disability.
Building on this momentum, National Cabinet has agreed to additional reforms including:
- Adjusting state and territory NDIS contribution escalation rates to be in line with actual scheme growth, capped at 8 per cent, from 1 July 2028 with a review point in 2030-31.
- Working together to target annual cost increases to 5 to 6 per cent.
- $2 billion, matched by states, to deliver Thriving Kids, the first phase of Foundational Supports, with the Commonwealth providing $1.4 billion of its contribution to support states to help their kids thrive.
The national model of Thriving Kids has been informed by the Thriving Kids Advisory Group led by Minister Butler and Professor Oberklaid OAM, and the Parliamentary Inquiry led by Dr Mike Freelander and Dr Monique Ryan.
The Commonwealth has listened to stakeholders including parents, health professionals, disability advocates, educators and states. To ensure states and territories have enough time to implement Thriving Kids the roll out will now commence on 1 October 2026, with full implementation by 1 January 2028.
Children with permanent and significant disability, including those with developmental delay and/or autism with high support needs, will continue to be eligible for the NDIS.
From 1 October 2026, children with developmental delay and/or autism with low to moderate support needs will start to access support through Thriving Kids. Thriving Kids will be fully rolled out by 1 January 2028.
Children aged 8 and under enrolled in the NDIS prior to 1 January 2028 with developmental delay and/or autism with low to moderate support needs will be subject to the usual reassessment criteria in place prior to 1 January 2028.
The Commonwealth, states and territories will continue to finalise the national and local services to be delivered to support children and their families in each jurisdiction.
The National Health Reform Agreement Addendum is more than hospital funding. This new Addendum has key reforms embedded throughout to make Australia’s hospital and health care system more effective, efficient and equitable.
Australia has world-leading health and disability support services. The decisions taken by National Cabinet today will further strengthen our health system and secure the future of the NDIS.
This media statement has been agreed by First Ministers and serves as a record of meeting outcomes.