With the discussions and negotiations between the state's largest private hospital and providers of healthcare insurance falling apart, over a thousand patients now face being charged extra fees.

It has been reported that Medibank Private has refused to pay a hike, which is speculated to be about 3%, to St Vincent's Private and The Mater Hospitals in order to effectively cover a patient's stay at the hospitals.

The talks failed to garner any results and broke down on Christmas, despite the fact that all other major health funds had been alright with the increase.

With the development, up-to 3,000 patients every year could now be forced to shell out "substantial" payments to pay the bill, which is generally taken care of by Medibank.

"They are targeting the most vulnerable. The sickest of the sick from all over this state. We often treat people with acute conditions who have to stay longer. The costs of healthcare have gone up. We do not expect healthcare providers to cover all the costs but there is an understanding that each year there is an increase", said St Vincent's Hospital Chief Executive Officer Steven Rubik, while confirming the breakdown of the talks.

An official confirmation of the development came in only yesterday.