As a result of the changes that kick in for the first time from 1 July, income thresholds used to calculate the private health insurance rebate have increased by about $3,000 for singles and $6,000 for families.
Currently, people earning up to $144,000 (singles) or $288,000 (families) can receive rebates, and depending on their income level, Australians may be able to get more back at tax time.
Having a suitable level of private hospital cover also means people don’t need to pay the Medicare Levy Surcharge (MLS), which can be up to 1.5% of one’s income. The rates applying for 2023/24 Financial Year are $93,000 for singles and $186,000 for families.
Bupa Health Insurance Managing Director Chris Carroll said the Federal Government’s tax concessions was to recognise Australians investing in their own health and wellbeing and support our mixed public and private health system.
“Our public hospitals remain under pressure, and we all have a role to play in helping keep our world-leading health system strong to ensure patients can access care when they need it,” Mr Carroll said.
“In some cases, having the most basic hospital cover could cost less than paying the MLS if you don’t have private health insurance – and we know most families would welcome savings during the current cost-of-living challenges Australians are facing.
“For example, a family can save about $441 dollars with ‘accident only’ hospital cover, instead of paying more than $3000 in tax and receiving no benefits.
“It’s worth investigating and getting the right financial and tax advice. If you’re eligible, claiming the private health insurance rebate can also help reduce your premium by up to 24% in some cases, depending on your circumstances.”
To help calculate the MLS, Bupa has an online tax calculator to calculate what you may be paying in tax.
Breaking down tax and private health insurance:
2023–24 Income thresholds
|
Family status |
Base tier |
Tier 1 |
Tier 2 |
Tier 3 |
|
Single |
$93,000 or less |
$93,001 – $108,000 |
$108,001 – $144,000 |
$144,001 or more |
|
Family |
$186,000 or less |
$186,001 – $216,000 |
$216,001 – $288,000 |
$288,001 or more |
Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child
Medicare Levy Surcharge
Having a suitable level of private hospital cover means people don’t need to pay the Medicare Levy Surcharge (MLS), which can be up to 1.5% of your income.
Most Australian taxpayers help pay for Medicare through the Medicare Levy, but if they earn more than $93,000 as an individual or $186,000 as a couple or family in 2023/24, they may have to pay the MLS as well.
Those who had private hospital cover, even the most basic, during the full tax year won’t need to pay the MLS.
|
|
Without hospital cover |
With hospital cover |
|
NSW, single without kids, earns $97,000 p/y |
$970.00 p/y MLS
|
$965.11 p/y for Bupa Basic Accident Only Hospital cover.
Saving $4.89 and benefits like:
|
|
NSW, married without kids Earns $250,000 (combined) p/y |
$3,125.00 p/y MLS
|
$2,683.44 p/y for Bupa Bronze Simple Hospital cover
Saving: $441.56 and benefits like:
|
Use the online tax calculator to calculate what you may be paying in tax
Lifetime health cover
It’s helpful to have private hospital cover before people turn 31. Each year someone who has turned 31 is not covered under private health cover, it will cost 2% more in premiums when they do get cover, and that continues to increase each year, up to 70% and this increase in premium will remain in place until they have held private hospital cover for 10 continuous years.
Getting private hospital cover sooner helps to avoid those 2% increments adding up.
Age-based discount
Bupa has an initiative that offer people aged under 31 a discount on private hospital cover. The discount is 2% for each year between 18 and 30, when they first purchase hospital cover. The maximum discount is 10% for those aged 18 to 25 years. Those who have health insurance from a young age can keep this 10% discount until their 41st birthday.
Private health insurance rebate
The Federal Government contributes towards private health insurance premiums based on a person’s income and age.
|
Income for surcharge purposes |
Rebate for 1 July 2023 – 31 March 2024 |
|
$93,000 or less for a single person |
24.608% |
|
$93,001 – $108,000 for a single person |
16.405% |
|
$108,001 – $144,000 for a single person |
8.202% |
|
$144,001 or more for a single person |
Not eligible |
|
$186,000 or less for a family |
24.608% |
|
$186,001 – $216,000 for a family |
16.405% |
|
$216,001 – $288,000 for a family |
8.202% |
|
$288,001 or more for a family |
Not eligible |
Note: The family income threshold is increased by $1,500 for each Medicare levy surcharge dependent child after the first child.
ENDS
For more information, please contact:
Aleks Devic
Head of Media (Health Insurance) and Content
Email: [email protected]
About Bupa Asia Pacific
Bupa is an international healthcare group which has been committed to a purpose of helping people live longer, healthier, happier lives and making a better world for more than 70 years.
Bupa Asia Pacific operates in Australia, New Zealand and Hong Kong, supporting about 7.3 million customers through a broad range of health and care services including health insurance, aged care, dental, medical, optical and hearing services.
Employing more than 22,000 people in the region, we believe that we can make a real difference to the lives of customers through our values, purpose and the way that we deliver personalised care.
Over the past 17+ years we have invested more than AUD$36 million in partnerships and programs focused on improving health of communities across Australia.