Australia’s veterans’ healthcare system is facing growing scrutiny over the way medicinal cannabis is prescribed and supplied, with authorities moving to strengthen safeguards around a rapidly expanding market.

The Department of Veterans’ Affairs (DVA) says it has identified concerning commercial practices involving some cannabis businesses, particularly vertically integrated models where companies can have links between prescribing, supplying and selling medicinal products.

The government has also changed the veterans’ medicinal cannabis framework, restricting funded access to specific conditions including chronic pain, chemotherapy-related nausea, palliative care, anorexia, certain neurological conditions and epilepsy. The changes are designed to ensure taxpayer-funded treatment is directed towards medicines considered clinically appropriate and supported by evidence.

Regulators have separately increased scrutiny of the sector. The Therapeutic Goods Administration has commenced proceedings against providers over alleged unlawful advertising of medicinal cannabis to veterans, adding pressure on companies operating in the rapidly expanding market.

DVA has also raised concerns about the way some businesses market directly to veterans. Authorities have pointed to social media campaigns, persistent sales approaches and subscription-style arrangements that could limit consumer choice or obscure commercial relationships.

The financial implications are significant. Government expenditure on veterans’ medicinal cannabis is projected to reach $125 million in 2025–26, compared with $36 million two years earlier. That represents an increase of almost 250 per cent, placing greater attention on whether public funding is delivering appropriate clinical outcomes.

The debate also highlights the challenge of balancing access with oversight. Veterans advocates argue that some former service personnel have experienced meaningful relief from medicinal cannabis and should not lose access because of misconduct by individual providers.

However, the government says stronger controls are necessary to prevent vulnerable veterans from being commercially targeted and to ensure public money is not driving unnecessary treatment.

The issue now sits at the intersection of veterans’ welfare, healthcare regulation and taxpayer accountability, with authorities under pressure to protect access while preventing exploitation.