AAPi has received a post-federal budget debrief from the DVA to confirm further details beyond what was released on Budget night. This includes one of the most significant changes to veteran psychology funding in decades: a major increase to DVA allied health schedule fees from 1 July 2027, backed by a $169.7 million investment over five years. DVA described this as the largest investment in allied health provider fees in decades, aimed at improving access for veterans while addressing longstanding concerns around remuneration for providers.
DVA has confirmed substantial increases to psychology schedule fees.
For example, the current fee for a 50+ minute psychology consultation in rooms (item US14) is currently $163.40 and will increase to $260 from 1 July 2027.
DVA has indicated that all allied health fees will increase, although the detailed fee schedule has not yet been released. At this stage, DVA advised that the full schedule is likely to become available closer to the commencement date of the changes in July 2027.
For many psychologists providing care to veterans, DVA fees have been a longstanding concern. This has been a continued area of AAPi advocacy.
Importantly, DVA indicated this is not simply a fee increase exercise. Officials stated they see this reform as an opportunity to address a range of historical issues with DVA arrangements, including:
- Improving and simplifying travel arrangements and out-of-room service delivery
- Addressing longstanding administrative and schedule concerns raised by providers over many years
- Streamlining aspects of DVA fee schedules to better reflect contemporary practice
This will be a key time to resolve many of the issues professions have raised for years and AAPi will have extended consultation over the next 3–6 months. We look forward to working with members on this important area.
We also received further information on the pricing caps. The new arrangements include a proposed $5,000 annual limit on allied health spending under Veteran Card arrangements, commencing 1 July 2027.
- Open Arms services are NOT included in the cap - DVA confirmed that mental health care provided through Open Arms sits outside the $5,000 limit and will not count toward veterans’ annual cap.
- Medical services are NOT included - The cap applies to eligible allied health services only and does not include medical, dental, optical or hearing services.
- Most veterans are not expected to be affected - DVA modelling suggests around 90% of veterans currently spend below the proposed cap, even when anticipated fee increases are factored in. Average annual expenditure was reported to be approximately $3,000 per veteran. AAPi will be working on advocating for clear and easy processes for exemptions to the cap where there is genuine need.
AAPi welcomes acknowledgement that psychology fees have required review and that broader DVA processes need improvement. There appears to be genuine openness from DVA to revisit longstanding concerns affecting psychologists delivering veteran care.
However, AAPi is concerned about the potential unintended consequence of a single cap across both mental and physical health needs, particularly for veterans with complex presentations, chronic pain, PTSD, rehabilitation needs, and comorbid conditions. During the consultation, concerns were raised that veterans should not be placed in a position where they need to choose between accessing psychological care or physical health supports. DVA acknowledged this concern, and we will continue this advocacy.
AAPi will be advocating for consideration of:
- Separate annual caps for mental health and physical health supports, to reduce the risk that veterans with complex needs are forced to prioritise one area of care over another
- Clear exemption pathways for veterans with higher or ongoing support needs
- Arrangements that recognise chronic and comorbid conditions as well as acute presentations
- Transparent systems so veterans can easily monitor remaining allocations
- Final fee schedules and administrative processes that support sustainable psychology service delivery
What happens next?
DVA has committed to a robust consultation process over the next 3–6 months with peak bodies and professions. AAPi intends to engage closely in these discussions to advocate for reforms that support both:
- Fair, timely access to psychological care for veterans, and
- Sustainable funding arrangements that appropriately recognise psychologists’ expertise and the complexity of veteran mental health care.
This reform represents one of the most significant opportunities in years to address longstanding DVA issues. AAPi will continue working to ensure psychologists’ experiences and veterans’ needs remain central to the conversation.