The Independent Health and Aged Care Pricing Authority (IHACPA) has released the Pricing Framework for Australian Public Hospital Services 2026-27 following public consultation.
Updated annually, the pricing framework outlines the policy and evidence used to inform the development of the national efficient price (NEP) and national efficient cost (NEC) determinations. The determinations will be published in March 2026 and used to calculate Australian Government funding for public hospital services for the 2026-27 financial year.
IHACPA received 30 submissions to its consultation paper from stakeholders including state and territory governments, professional health organisations and the private health sector. The accompanying consultation report summarises the feedback received and IHACPA's responses, outlining how this input informed the development of the pricing framework.
Each year, developing a sustainable pricing model for public hospital services requires robust consultation, data analysis and stakeholder engagement. The 2026-27 pricing framework continues to build on this foundation to ensure funding is fair, evidence-based and responsive to the evolving needs of the healthcare system.
IHACPA Chair, Mr David Tune AO PSM
Key highlights in this year's pricing framework
Classification updates
For the National Efficient Price Determination 2026-27, admitted acute care will be priced using the Australian Refined Diagnosis Related Groups Version 12.0. Refinements to better reflect clinical practice and resource use include new groupings for maternal care, a new group for organ donation after death and new principles for consistent grouping of intervention based episodes of care. Furthermore, Tier 2 Version 10.0 will introduce new classes for hospital based, non-admitted voluntary assisted dying services.
Coronavirus disease 2019 (COVID-19) temporary measures
IHACPA intends to remove the temporary measures introduced to account for the impact of COVID-19 on public hospital service delivery. These temporary measures are no longer required as activity and cost data used for the NEP already reflect how the pandemic affected hospital services. COVID-19 will instead be considered a risk factor in the safety and quality pricing adjustments, where it is statistically relevant.
Pricing model refinements
IHACPA will commence a review of the Indigenous adjustment, patient residential and treatment remoteness area adjustments and smaller state and territory price weights used in the calculation of the NEP and NEC.
Virtual care integration
Following the Virtual Care Project, IHACPA has revised its pricing guidelines to support best practice care across all modalities, including virtual care. Work is underway to improve emergency virtual care data collection and classification.
Data quality and transparency
IHACPA has recommenced the annual Independent Financial Review of the National Hospital Cost Data Collection to ensure the data remains robust and fit for purpose.
