Record $1.46 billion Pulled from Australian Superannuation for Medical Bills Amid Regulator Crackdown
Australians withdrew a record $1.46 billion from their superannuation on compassionate grounds in 2025-26, mostly for medical expenses, prompting regulators to warn against predatory practices.
In the 2025-26 financial year, Australians accessed a historic $1.46 billion from their retirement savings under compassionate-release rules, with roughly $1.42 billion spent on medical care, especially dental work. The number of approved applications fell slightly to about 65,000, but the overall outflow rose 220 percent since 2018-19. Regulators, including the Australian Tax Office and the Australian Health Practitioner Regulation Agency, say some dentists and other practitioners are using aggressive online marketing to persuade patients to withdraw super for non-essential procedures, such as cosmetic dentistry.
Over the past year, the ATO imposed $1.5 million in fines on offending providers, including a $30,000 penalty for a falsified medical report. Consumer advocates are calling for a ban on advertising that promotes early super withdrawals, while the government says it will monitor the issue and consider further safeguards.
Why it matters
Mass withdrawals erode retirement savings and expose vulnerable Australians to predatory health-care practices.
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