Become a second-tier default benefits eligible hospital

Insurers pay second-tier default benefits for private hospital treatment if they do not have an agreement with the hospital and the hospital is second-tier default benefits eligible. Hospitals must apply to be assessed and found eligible.

What are second-tier default benefits?

Generally, insurers must pay second-tier default benefits for hospital treatment if:

  • they do not have a negotiated agreement with the hospital and
  • the hospital is second-tier default benefits eligible.

Second-tier default benefits are higher than what would otherwise be payable if the hospital was not eligible.

Which hospitals can apply?

To apply to be eligible, a hospital must:

New hospitals can submit a second-tier application at the same time they apply to be declared a hospital. We will not consider the application until the hospital is declared.

How to apply

Private hospitals can apply at any time.

Read the Second-tier Default Benefits Guidelines first. The guidelines tell you what to include in your application and explain the process in detail.

To apply:

If your accreditation is first edition, you must provide a sample informed financial consent (IFC) document and procedures as part of your application.

We will tell you the outcome within 60 days of receiving a complete application and fee payment.

If you are reapplying, make sure you apply and pay the fee at least 60 days before your current eligibility expires.

When eligibility expires

Second-tier eligibility expires 60 days after a hospital’s accreditation expires.

Benefit rates

The second-tier default benefit for hospital treatment is at least 85% of the average charge for the equivalent treatment, under that insurer’s negotiated agreements for comparable private hospitals.

Comparable private hospitals are those in the same state and in the same second-tier hospital category. Each health insurer must work out second-tier default benefit rates for each category in each state and territory.

Annual review of hospital categorisation

Every year, the Department reviews the second-tier categories of all private hospitals. As part of our consultation process, we encourage all private hospitals to review the list to confirm their category is correct. This year's consultation closed on 29 June 2021. The Department thanks all the hospitals that have responded.

We publish the updated private hospital second-tier category list every year by 1 August.
Questions about the category review should be sent to the email address below.

This list only categorises private hospitals. It does not mean all the hospitals in the list are second-tier eligible. To check which hospitals are eligible, see the Commonwealth declared hospital list on the hospitals page (scroll down to the bottom).

Cost recovery

We recover the costs of assessing these applications. Find out more in our Cost Recovery Implementation Statement.

Legislation

Contact

Second-tier default benefits contact

Email us to submit applications for second-tier default benefits eligibility.

phi.hospitals [at] health.gov.au

View contact

Last updated: 
30 July 2021

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