From 1 July 2012 there will be important changes to the Federal Government's Private Health Insurance Rebate and Medicare Levy Surcharge. This page helps explain how these changes affect you.
The new legislation means that the Private Health Insurance Rebate that you currently receive will be linked to your household income and may be reduced or removed depending on your income.
At the same time, the government is increasing the Medicare Levy Surcharge, which means that individuals in higher income brackets will pay a larger tax surcharge if they don't maintain eligible hospital cover.
The table opposite outlines the new income tiers and applicable rebate and surcharge levels.
You can also use our calculator to find out how you are affected by the changes. Click one of the two buttons below:
| No Change | Tier 1 | Tier 2 | Tier 3 | |
|---|---|---|---|---|
| Income | ||||
| Singles | ≤ $84,000 | $84,001 - $97,000 | $97,001 - $130,000 | ≥ $130,001 |
| Couples/ Families |
≤ $168,000 | $168,001 - $194,000 | $194,001 - $260,000 | ≥ $260,001 |
| Government Rebate | ||||
| Aged < 65 | 30% | 20% | 10% | 0% |
| Aged 65-69 | 35% | 25% | 15% | 0% |
| Aged 70+ | 40% | 30% | 20% | 0% |
| Additional Medicare Levy Surcharge* | ||||
| Singles | 0% | 1% ($840 - $970) | 1.25% ($1,212 - $1,625) | 1.50% ($1,950) |
| Couples/ Families |
0% | 1% ($1,680 - $1,940) | 1.25% ($2,425 - $3,250) | 1.50% ($3,900) |
Income thresholds will be based on Average Weekly Ordinary Time Earning (AWOTE).
Single parents and couples (including de facto couples) are subject to the family tiers.
For families with children, the thresholds are increased by $1,500 for each child after the first.
* Payable in addition to the 1.5% Medicare Levy if you don't have eligible hospital cover.
It is important that members with an annual income in tiers 1-3 advise HBF of their current income tier.
The Federal Government is also increasing the Medicare Levy Surcharge from 1 July 2012.
If you are a single earning more than $84,000 or family earning over $168,000 you could save hundreds of dollars at tax time by taking out hospital cover today.^
Calculate how much you could save.
^ HBF is not a Tax Agent Service. Health fund members should seek the advice of their tax advisor or the ATO before purchasing a policy.
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