Medicare Levy Surcharge

Medicare provides Australians with access to free or subsidised medical services, lower-cost prescriptions, and free care as a public patient in a public hospital.

It’s partly funded by taxpayers who pay a Medicare levy of 2% of their taxable income.

In addition, if you or your family do not have private hospital cover and have a taxable income above a certain amount, you’ll have to pay an extra charge called the Medicare Levy Surcharge (MLS).

Medicare Levy Surcharge (1 April 2017 to 31 March 2018):

Singles:

$90,000 or less

$90,001–105,000

$105,001–140,000

$140,001 or more

Families*:

$180,000 or less

$180,001–210,000

$210,001–$280,000

$280,001 or more

All ages

0.0%

1.0%

1.25%

1.5%

* ‘Families’ include single parents and couples (including de facto couples). For families with children, the thresholds are increased by $1,500 for each child after the first.
Source: www.privatehealth.gov.au

So, if you’re a single person or a family with an annual taxable income of more than $90,000 or $180,000 respectively and you don’t have private hospital cover, you’ll be required to pay the MLS.

It’s the federal government’s way of encouraging higher-earning Australians to take out private hospital cover, thereby reducing pressure on the public hospital system.

Note that standalone extras cover – without hospital cover – does not exempt you or your family from the MLS.

Don’t have private hospital cover?

Calculate your Medicare Levy Surcharge

Enter your taxable income:

To find out more, visit Australian Taxation Office

Get a Quote

Lifetime Health Cover

Lifetime Health Cover (LHC) is an Australian Government initiative to encourage people to take out private hospital insurance earlier in their lives.

For every year over the age of 30 you do not have cover, you’re required to pay a 2% loading on top of your insurance premium.

The LHC loading starts on what’s called your ‘base day’ – the deadline by which you must have taken out private hospital cover to avoid incurring the loading. Most people’s LHC base day is 1 July following their 31st birthday.

If, for example, you take out cover when you’re 35, you’ll pay 10% more than someone who took it out at age 30, 5 years x 2% = 10% LHC (the LHC is capped at 70%).

Once you’ve paid the LHC loading for 10 continuous years, it’s removed.

LHC Calculators

The Australian Government has two calculators you can use:

 

Lifetime Health Cover Calculator

Find out your LHC base day and what your loading would be if you took out private hospital cover today; or to confirm your current loading.

Calculate Now
 

Ten Years Continuous Cover Calculator

Confirm whether you have paid a loading on your hospital cover for 10 continuous years.

Calculate Now

To find out more, visit PrivateHealth.gov.au

Get a Quote

Private Health Insurance Rebate

If you have private health insurance, you can get a rebate from the Australian Government to help cover the cost of your insurance premium.

The size of the rebate – which applies to hospital, extras, and ambulance policies – varies according to you or your family’s income.

Private Health Insurance Rebate (1 April 2017 to 31 March 2018):

Singles:

$90,000 or less

$90,001–105,000

$105,001–140,000

$140,001 or more

Families*:

$180,000 or less

$180,001–210,000

$210,001–$280,000

$280,001 or more

Age

Base Tier

Tier 1

Tier 2

Tier 3

Under 65

25.934%

17.289%

8.644%

0%

65–69

30.256%

21.612%

12.966%

0%

Over 70

34.579%

25.934%

17.289%

0%

* ‘Families’ include single parents and couples (including de facto couples). For families with children, the thresholds are increased by $1,500 for each child after the first.
Source: www.privatehealth.gov.au

So, if like many Australians, you’re in the lower income tier, you can get a rebate, or discount, on your insurance premiums of roughly 25% to 35%, depending on your age.

How to claim the rebate

If you’re eligible for the private health insurance rebate, you can claim it in one of two ways:

  • through a reduced premium – you can nominate the income tier you expect to fall into by contacting us; or by completing the Medicare form MS006 and submitting it to us
  • through your tax return – at the end of the financial year, we’ll send you a statement to help you complete your tax return.

To find out more, visit PrivateHealth.gov.au

Get a Quote

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