What is Lifetime Health Cover loading?

Find out how the Lifetime Health Cover loading works and how it might affect you.

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What is private health insurance?

The Lifetime Health Cover loading (LHC loading) is an extra cost applied to the price of hospital insurance, which makes it more expensive. It only affects people 31 or older who don’t have hospital insurance and decide to buy it later in life. It’s designed to encourage people to buy hospital insurance earlier in life and stay covered.

To avoid the LHC loading, all you need to do is buy hospital insurance on or before 1 July following your 31st birthday.

There are special circumstances where you’d be exempt from the LHC loading; head to the Private Health Insurance Ombudsman to find out more.

How is the LHC loading calculated?

For every year over the age of 30 you don’t have hospital insurance, the price goes up 2%. The loading is capped at a maximum of 70%. Basically, if you buy hospital insurance after you turn 31, it could be more expensive than if you’d bought it earlier in life.

To calculate your LHC loading, head to the Private Health Insurance Ombudsman website for a loading estimate.

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Frequently asked questions

My 31st birthday falls in the first half of the year. What date do I need to purchase hospital insurance by to avoid the lifetime health cover loading?

Say your 31st birthday is on the 21st April 2021 - you have until the 1st July 2021 to buy hospital insurance and avoid the loading.

My birthday falls in the second half of the year. What date do I need to purchase hospital insurance by to avoid the lifetime health cover loading?

Say your 31st birthday is on 25 October 2021 - you have until 1 July 2022 to buy hospital insurance and avoid the loading.

I’m over 31 and the lifetime health cover loading has already been applied to me. Do I need to purchase hospital insurance?

If you’re 31 or older and don’t have hospital insurance, it’s still a good idea to buy it as soon as possible. This is because the lifetime health cover loading (LHC) goes up by 2% every year that you don’t have hospital cover, up to a maximum of 70%. For example, if you get hospital insurance at 41, you’ll pay an extra 22% on top of the base cost of your premium, so long as you maintain your cover.

The good news is that the LHC loading doesn’t last forever – once you’ve held hospital insurance for a continuous 10 years, the loading is removed.

Just remember, the LHC loading only applies to hospital cover; it does not apply to extras, urgent ambulance or overseas visitors’ insurance. For example, if you buy hospital insurance in addition to extras or urgent ambulance insurance, you’ll only pay the LHC loading on the hospital insurance portion of your premium.

If the lifetime health cover loading applies to me, will the loading affect other people on my couple’s or family policy?

For couples and families, the lifetime health cover loading is calculated as an average between the two adults. For example, if one person has a 40% loading and the other person has a 10% loading, the loading applied to the couple’s policy is 25%.

Am I still eligible for the Australian Government rebate on private health insurance if the lifetime health cover loading applies to me?

If you pay the lifetime health cover (LHC) loading, you’re still eligible for the rebate. However, you’ll only get a rebate on the base premium of your hospital insurance and not the LHC loading component.

Will the lifetime health cover loading still apply if I switch health funds?

Yes, your lifetime health cover loading status stays the same even when you switch health funds.