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Government incentives to get health insurance

You've probably heard that the government offers financial incentives for people who purchase private health insurance. Here's how they work.

Government subsidies

The Australian Government may subsidise the cost of your health cover, depending on your age and how much you earn. This is called the Australian Government Rebate (AGR) on private health insurance. If you're eligible for the AGR, it can be claimed in one of two ways:

  1. As an upfront reduction on your premium, or
  2. At the end of the financial year, when you lodge your tax return.

Learn more about the Australian Government Rebate.

 

  Base tier Tier 1 Tier 2 Tier 3
Income thresholds
Singles  Up to $90,000 $90,001 - $105,000 $105,001 - $140,000 $140,001 and above
Families Up to $180,000 $180,001 - $210,000 $210,000 - $280,000 $280,001 and above
Australian Government Rebate effective from 1 April 2018 – 31 March 2019*
Less than 65 years 25.415% 16.943% 8.471% 0%
65 - 69 years
29.651% 21.180% 12.707% 0%
70 years+ 33.887% 25.415% 16.943% 0%
Australian Government Rebate effective from 1 April 2019 to 31 March 2020*
Less than 65 years 25.059% 16.706% 8.352% 0%
65 - 69 years
29.236% 20.883% 12.529% 0%
70 years+ 33.413% 25.059% 16.706% 0%

 

Get cover sooner and you could avoid extra costs

Once you turn 31, a 2% loading may be added to your hospital cover premium for every year you're without hospital cover after 30. This is called the Lifetime Health Cover (LHC) loading. If you take out hospital cover by 1 July following your 31st birthday you may avoid LHC.

Learn more about Lifetime Health Cover loading.

You could avoid government charges

If you don’t have private hospital cover and you earn more than $90,000 (or $180,000 for families), the Australian Tax Office may add an extra charge to your tax bill. It’s called the Medicare Levy Surcharge and it could be up to 1.5% of your income.

Learn more about the Medicare Levy Surcharge.

*Income thresholds indexed and effective until 30 June 2021.