Mr Mehrtens was freed and picked up by a joint team in Nduga Regency, the police said.
“Today we have picked up pilot Phillip who is in good health and we flew him from Nduga to Timika,” Faizal Ramadhani, head of a special unit formed to handle rebels in Papua, said in a statement, agencies reported.
The released hostage was then given medical and psychological checks before he was flown to Papua’s city of Timika.
Mr Mehrtens was working for Indonesian airline Susi Air when he was snatched by rebels at Nduga airport in the restive region on February 7 last year.
He was providing vital air links and supplies to remote communities at the time of his abduction by rebels from the TPNPB.
Last year, the TPNPB set fire to the Susi Air plane, released five other passengers but held on to Mr Mehrtens.
During his months-long ordeal in the Papuan countryside, the New Zealander made sporadic appearances on video, likely under duress, to address his family and his government.
The rebels said he was in good health throughout his captivity, but his appearance changed drastically over time, becoming gaunt, long-haired and with an unkempt beard in proof-of-life videos where he asked for medication to aid his asthma.