The Government announcement today to fund a second cochlear implant for under 18-year-olds will save each affected family up to $50,000, the National Foundation for the Deaf says.
Children and young people with profound hearing loss would now have both implants funded rather than just one, Health Minister Tony Ryall said.
"Budget 2014 is providing an extra $6.3 million over four years for a bilateral cochlear implants programme for children."
Under the current policy, children with severe to profound hearing loss in both ears receive one funded cochlear implant. The new funding would mean that from July 1 those children would receive two implants.
The National Foundation for the Deaf's chief executive Louise Carroll said the announcement was "brilliant" and would save families between $30,000 and $50,000.
"Families have been doing independent fundraising. Some families take out mortgages on their homes and do all sorts of things to get the extra money.
"So it's great what's happening; fully supportive of it."
The implant gives children with hearing loss a "functioning hearing ability", Ms Carroll said.
There is a range of reasons for profound hearing loss, including being born with it or the loss resulting from an illness or injury.
Ms Carroll hoped the Government would also provide funding for children with auditory problems where implants were not a suitable option for them, as well as money for captioning on broadcast media, which everyone with hearing difficulties could benefit from.
Southern Cochlear Implant Programme general director Neil Heslop said it was a "significant announcement".
"While the majority of children do extremely well with a single implant, the benefit of having an implant in each ear is significant.
"We know how effective cochlear implants can be and it is always a delight to see the impact they have on our patients who, literally, hear things differently for the first time in their lives in many cases."
A single implant had been the standard treatment for children with profound hearing loss, but international best practice had changed and the Ministry of Health had updated their policy, Mr Ryall said.
More than $2m of the $6.3m had been set aside to provide a funded second implant to children aged under six who had already received a single implant through the cochlear programme.
The second implant was offered only to children under six, who already had one implant, because international evidence suggested a second implant was less effective and less tolerated by older children who had used a single implant for a long period.
"Some families have already privately funded a second implant for their child. We will provide these children with free follow-up services, such as repairs, replacement speech processors and spare batteries," Mr Ryall said.
"In addition to the $6.3 million for children's bilateral cochlear implants, there will also be a one-off $1.1 million funding boost to reduce the wait list for adults requiring cochlear implants."