Health Ministers Turn Down Federal Funding Amidst Crisis of 3,000 Elderly Patients Awaiting Care

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State and territory health ministers warn more than 3,000 older Australians are languishing in hospital beds with nowhere else to go while awaiting placement in aged care.

The figure came as ministers rejected the latest funding offer from the federal government to prop up the nation’s overstretched public hospital system.

After a meeting with federal Health Minister Mark Butler on Friday, all parties emphasized their willingness to continue negotiations.

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Butler expressed optimism, suggesting that a deal might be reached by Christmas.

He warned the clock was ticking, with the effective deadline being before the South Australian government goes into caretaker mode in late February.

“If we haven’t struck a deal by then, it becomes very difficult to put in place new hospital funding arrangements before July 1,” Butler said.

“All jurisdictions are ‘eyes wide open’ that the runway is getting shorter and shorter.”

States and territories insisted the federal government stick to a 2023 agreement that the Commonwealth would increase its share of public hospital funding to 42.5 per cent by 2030 and 45 per cent by 2035.

Butler could not confirm the numbers of aged Australians awaiting federal placements who were in hospital but acknowledged the pressures on both the aged care and hospital systems.

“We’re right at the beginning of a very big surge in demand for aged care, because the oldest of the Baby Boomers have turned 80 this year, my dad included,” he said.

Discussions behind the scenes remained positive.

“Everyone’s doing their darnedest, despite the political rhetoric, to come to an agreement as quickly as we can,” he said.

This week, Albanese sent letters to state and territory leaders offering a $1 billion top-up of the additional $20 billion already on the table, as well as $2 billion extra to address older patients staying in hospital for extended periods.

State and territory leaders have said the money on the table falls tens of billions of dollars short of what is needed.

In a statement ahead of the meeting, the Northern Territory government said it would continue to push for its fair share of federal health funding.

“Right now, the NT gets the worst deal in the nation — we receive the lowest health funding contribution rate in the country at only 31.8 per cent,” NT Health Minister Steve Edgington said.

“Hitting even the national average would mean another $200 million for territory patients.”

Western Australia Premier Roger Cook said the deal on the table was insufficient but he was keen to engage constructively with the federal government.

Labor placed health at the centre of its federal election campaign earlier in 2025, promising to inject more money into strained systems.

A report commissioned by the states and territories found up to one in 10 public hospital beds were being taken by stranded patients needing alternative accommodation in aged care and disability support.

Australian Medical Association president Danielle McMullen said patients would be the ultimate victims of any funding impasse.

“This failure condemns Australian patients to longer waits, greater suffering and worsening access to care due to inadequate funding and government inaction.”