The number of Australians accessing superannuation to fund medical costs has risen substantially in recent years with the majority of applications related to weight loss surgery.
The Treasury report on the early release of superannuation benefits shows the total amount subject to early release from superannuation accounts has risen from $42 million in 2000-01 to around $290 million in 2016-17.
According to Treasury, this represents just over 0.01 per cent of funds held in the superannuation system.
Medical treatment and related transport accounted for 72 per cent of funds approved for release. Mortgage payments represented 18 per cent.
"Release on medical grounds has increased by around $205 million over the period since 2000-01, which is nearly a five-fold increase compared to all other grounds of compassionate release, which have increased by around $43 million over the same period," said the Treasury report.
The average amount of superannuation approved for early release per application on medical grounds has risen from $9,000 in 2010-11 to around $14,000 in 2016-17.
The rise in the number of applications relate to out-of-pocket expenses associated with weight loss surgery. A smaller proportion is attributable to assisted reproductive treatment (ART).
"In the period July to September 2016, around 56 per cent of approved medical ground applications were for bariatric surgery (1,857 applications) and around 7 per cent were for ART (239 applications). Most commonly, funds to pay for bariatric surgery are accessed on the basis that the surgery will treat a life threatening illness, or alleviate acute or chronic pain. This clinical determination is made by the treating surgeon."
Treasury is seeking feedback on the report, including what medical conditions should qualify for early release, such as dental.