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Medicare Levy Surcharge

What is the Medicare levy surcharge?

The Medicare levy surcharge is an additional 1 – 1.5% surcharge of taxable income imposed on higher income earners who are eligible for Medicare but do not have private Hospital cover. If the surcharge applies to you, your Medicare levy increases from 1.5%, that is paid by most Australian tax payers, to 2.5 – 3% of your taxable income. The Medicare levy surcharge is means tested based on income.

Income for Medicare levy surcharge purposes
Medicare levy surcharge
Singles less than $88,000
Couples/families less than $176,000
0.0%
Singles $88,001 – 102,000
Couples/families $176,001 – 204,000
1.0%
Singles $102,001 – 136,000
Couples/families $204,001 – 272,000
1.25%
Singles more than $136,001
Couples/families more than $272,001
1.5%

 *On a family membership the income threshold increases by $1,500 for each additional child. Thresholds are applicable for 1 July 2013 to 30 June 2014.

How to avoid the Medicare levy surcharge?

If you are single and earn more than $88,000 a year or a couple/family earning more than $176,000 per year, you can avoid paying the Medicare levy surcharge by taking out any of our Hospital or Combined cover products.

The following Teachers Health Fund covers exempt members from paying the Medicare levy surcharge:

Extras cover alone will not exempt you from the additional surcharge.

Join NowX

Membership Type

You

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Tell us a little about yourself and your partner to get started:

Tell us a little about yourself, your partner and family to get started:

Tell us a little about yourself and your family to get started:

Your Cover

Select your desired level of cover:

or

Your Rebate

All Australian residents, who are entitled to Medicare, are able to claim an income tested rebate on their private health insurance; would you like to apply your rebate?

For individuals earning between $88,001 - $102,000 (or $176,001 - $204,000 for families*).
*For families with children, the thresholds are increased by $1,500 for each child after the first.

How rebate tiers workX

Most Australians with private health insurance currently receive a rebate from the Australian Government to help cover the cost of their premiums. The private health insurance rebate is income tested. The table below details the different rebate amounts and Medicare Levy Surcharge levels.

The rebate applies to hospital, general treatment and ambulance policies. It does not apply to overseas visitors cover. The rebate levels applicable for 1 July 2013 to 30 June 2014 are:

Singles
Families
≤$88,000
≤$176,000
≤$88,001-102,000
≤$176,001-204,000
≤$102,001-136,000
≤$204,001-272,000
≤$136,001
≤$272,001
Rebate
< Age 6530%20%10%0%
Age 65-6935%25%15%0%
Age 70+40%30%20%0%

Single parents and couples (including de facto couples) are subject to family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first. http://www.privatehealth.gov.au/healthinsurance/incentivessurcharges/insurancerebate.htm