NSW Workers Compensation Changes from 1 October 2026
From 1 October 2026, additional changes to the NSW workers compensation scheme, impacting how treatment and rehabilitation services are approved and funded, came into effect. These reforms are designed to support evidence-based treatment, consistent decision-making and better recovery outcomes.
1. "Reasonably Necessary" Changed to "Reasonable and Necessary"
The test used by insurers to determine whether treatment and services can be funded has changed from "reasonably necessary" to "reasonable and necessary".
Insurers must now consider whether treatment:
Is primarily for the compensable injury
Is clinically justified
Is cost-effective
Represents value for money and supports recovery outcomes
This applies to medical, allied health, hospital, ambulance and workplace rehabilitation services claimed from 1 October 2026.
2. Allied Health Sessions Reduced from 8 to 4
The number of allied health consultations available without insurer approval has reduced from 8 sessions to 4 sessions.
Any treatment beyond the initial four sessions will generally require insurer approval, increasing the need for early treatment planning and clear evidence of recovery progress.
What This Means
These changes place greater emphasis on:
Early intervention and recovery planning
Evidence-based treatment
Demonstrated functional improvement
Collaboration between employers, insurers, treating practitioners and workplace rehabilitation providers
Employers can support positive outcomes by maintaining contact with injured workers, facilitating suitable duties where appropriate, and engaging workplace rehabilitation services early in the recovery process.
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