Lifetime Health Cover Loading (LHC)
What is LHC?
Under the Federal Government's Lifetime Health Cover (LHC) initiative a loading can be applied to your premium if you take out hospital cover later in life. It’s aimed at encouraging people to take out hospital cover early in life and maintain it.
When does the loading apply?
The loading applies if you don’t have hospital cover on 1 July following your 31st birthday. This means for every year you don’t have hospital cover, you’ll pay a 2% loading on top of a base rate on your premium or your share of a couple or family premium (up to a maximum loading of 70%). The loading applies only to hospital cover or the hospital component of our packaged covers – not to extras covers. Any loading that applies to your premium will be removed after you’ve held hospital cover continuously for 10 years.
Does the LHC loading apply to everyone?
No, the LHC loading doesn’t apply to people born on or before 1 July 1934. There are also special rules that apply to people who fall under a LHC exemption category, such as Australians returning from overseas, Norfolk Islanders, Veterans’ Affairs Gold Card holders, former members of the Australian Defence Force, staff of the Australian Antarctic Division, refugees and all other categories of migrants to Australia.
If I have a LHC loading will I have it forever?
No, the loading will be removed after you’ve held hospital cover continuously for 10 years.
What if I drop my hospital cover or let it lapse?
You can drop your hospital cover for a sum total of three years (1,094 permitted days) during your lifetime without any change to your LHC loading status. If you drop your hospital cover for longer than this, in most circumstances you’ll have to pay a LHC loading (or, if you were already paying the loading, it will be higher) once you take out hospital cover again.
The following won’t count towards your 1,094 permitted days without hospital cover:
- if you’ve been living overseas continuously for more than one year (this includes visits back home of 90 days or less at a time)
- if your health fund has agreed to a period of suspension.
What happens if I change health funds?
If you switch to us from another fund we recommend you keep your cover with your old fund until the date you transfer to us. This way you avoid using up any of the 1,094 permitted days you can be without hospital cover during your lifetime. Also, if you already have a LHC loading, it will move with you.
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