Australia has a mixed public-private healthcare system. Medicare, the public system, covers a large range of medical services. 

Private health insurance helps cover additional costs associated with hospitalisation, extras (like dental or physiotherapy), and treatment choices. 

The Australian Government offers a few incentives and penalties to encourage responsible management of private health cover. This page explains the key government rules you should be aware of:

  • Private Health Insurance Rebate
  • Lifetime Health Cover
  • Medicare Levy Surcharge

Let's explore each of these in more detail.

Private health insurance rebate

The government offers a rebate to help make private health insurance more affordable. The amount you receive depends on your income and other factors.

This rebate can significantly reduce your overall premium costs.

Find out if you’re eligible for the rebate

Lifetime Health Cover

Lifetime Health Cover, sometimes called private health insurance loading, is a government penalty for not taking out private hospital cover after your 31st birthday. 

It encourages people to get private health insurance early and maintain it throughout their lives.  

The penalty increases the longer you wait to get cover, but it's removed after consistently holding hospital cover with the penalty for a set period. There are exceptions for certain situations.

See how you can avoid paying this penalty

Medicare Levy Surcharge

The Medicare Levy Surcharge (MLS) is an additional tax that is paid by Australian taxpayers who don’t have private hospital cover, and who earn above a certain income.

It aims to encourage people to contribute to the private health system and help reduce pressure on the public system. If your income exceeds a certain threshold and you don't have an appropriate level of private health cover, you may be liable for the MLS. 

The surcharge is a percentage on top of the standard Medicare Levy. You can avoid the MLS by taking out an appropriate level of private health cover.

Want to avoid the surcharge?

Please note

Some content on this web page is obtained from external sources. Although we make every effort to ensure information is correct at the time of publication, we accept no responsibility for its accuracy. Health-related articles are intended for general information only and should not be interpreted as medical advice - please consult your doctor. By opening, viewing or using this webite, you acknowledge that you have read and unreservedly accept these Terms & Conditions