New research has revealed the immense potential of private virtual hospitals to transform healthcare delivery in Australia.
Conducted by Wesley Research Institute and led by Dr OIivia Fisher, the study explores how these “hospitals without walls” can safely and effectively provide hospital-level care in patients’ homes, combining telehealth consultations, remote monitoring, and hybrid care approaches.
41% of the 12.1 million hospital admissions in Australia in 2022-23 were in private hospitals. Many patients, particularly those in rural and remote Australia, must travel vast geographical distances to access private hospital care.
“A virtual hospital model offers an innovative way to bridge this distance while maintaining safety and quality,” said Dr Olivia Fisher, Wesley Research Institute Senior Research Fellow and Virtual Hospitals and Healthcare Program Lead.
The study, published in Nature’s Scientific Reports, and commissioned by UnitingCare Queensland, highlighted the potential for virtual hospitals to significantly improve timely access to healthcare across the whole of Australia.
Read the Publication
Fisher, O.J., Grogan, C., Barron, A., Kanagarajah, S., Smith, S-E., Smith, I. & McGrath, K. (2025) Considerations for establishment of a private virtual hospital identified using an implementation science approach. Scientific Reports 15, 3660. https://doi.org/10.1038/s41598-025-85965-5
The research also identified the broader benefits of virtual hospitals, including a reduced risk of hospital-acquired infections and the ability for patients to recover in a familiar, comfortable environment.
“For patients, being at home means staying connected with their community, sleeping in their own bed, eating food they actually like, and avoiding the constant disruptions of a hospital setting,” Dr Fisher said.
However, the study also highlighted the limitations of virtual hospitals, emphasising that only a specific subset of patients is suitable for this model of care.“Virtual hospitals are not a one-size-fits-all solution. They are most appropriate for patients with specific conditions where hospital care can safely be delivered at home, and this must be carefully assessed on a case-by-case basis.”
“Patients requiring urgent, complex or highly specialised care will continue to need traditional hospital settings.”
Research has shown that well-designed virtual hospitals have clinical and mortality outcomes that are equivalent to or better than traditional hospitals. Safe and effective virtual hospitals are operating around the world right now, freeing up beds and alleviating strain on overburdened traditional hospitals.
However, the research emphasised that systemic barriers remain the most significant challenge to implementing private virtual hospitals in Australia. Medicare restrictions currently prevent medical specialists from billing for telehealth consultations with admitted patients, which has a huge impact on the viability of private virtual hospitals in Australia.
“A medical specialist can claim a Medicare item number for a face-to-face consultation with an admitted patient, or a telehealth consultation with an outpatient, but not a telehealth consultation with an admitted patient.
“This means that virtual hospital patients would either have to pay out of pocket to see their doctor, which is not possible for many people, or doctors would have to give their time for free. We cannot expect doctors to work for free,” said Dr Fisher.
The researchers argue that without proper remuneration, the model becomes unsustainable, and patients are left without access to a viable alternative to traditional hospital care.
Changing just one line in the Medicare legislation would remove the biggest obstacle to private virtual hospitals and allow this innovation to thrive.
Dr Olivia Fisher
The authors call on the Federal Government to change the Health Insurance Act (Health Insurance Determination 2021) to enable medical specialists to claim for a telehealth consultation with a patient admitted to a virtual hospital.
We hope this research not only improves healthcare access but spurs on our community to rethink how we care for people in a way that best supports their comfort, safety and individual needs. Virtual hospitals represent the future of healthcare, but we need the support of policymakers and healthcare providers to make this vision a reality.
Dr Olivia Fisher