Private Healyh insurance and tax??????

[3'llhavetodo]

Does any one know exactly how the whole Private Health insurance for over 31's thing works.

My family currently does not have private health insurance. My DH is 33 and I am turning 31 in July. I have recently started to think about getting private health insurance for the whole tax thing, is there really that much of a benefit as we are rarely sick so wouldn't really need the insurance part.

[garfield13]

it depends on what your income is and how much extra tax you pay. For instance I have a friend who is very pro the public health system and would never have private health insurance, but when we were discussing it the other day and I said how much we pay for medicare in our taxes and how much they pay, and they pay more than use for medicare even including what we pay for health insurance. For their case if they took up basic private health they would be saving $900 a year due to the amount less they would be paying in tax.

[Rach08]

Hey.

As already said. Depending on your family income then you may be paying an extra 1% ( I think) tax- called the Medicare Levy Surcharge. This is on top of the medicare levy that everyone pays. This is based on income and your age doesn't come into it. Check the Australian Tax Office website for details on what the thresholds are.
Or take a look at your previous tax statements and see if you had to pay the surcharge.
You can avoid paying it by having private hospital cover so then you just need to figure out how much tax you pay vs how much insurance costs. I think there are some pretty basic policies out there with just hospital cover.

As far as your age goes there is a website www.privatehealth.gov.au (http://www.privatehealth.gov.au) that explains the policy I think it's called Life Time healthcover.
Basically the older you are when you take out private hospital cover the more you pay for it.
I think it only applies to hospital cover ( not extras- dental, optical etc) but you would need to check that with a few insurance companies and see what their policies are.

[Izy]

:yes: Rach is right, you have two issues here.

1- turning 31.
If you choose to buy private hospital cover for the first time, you will pay an age loading if over 31.
The way it works is each yr you delay joining past your 31st birthday you pay an extra 2%. Be aware that for Lifetime Health Cover (LHC) reasons you have until the end of the financial year before your birthday kicks in.
So if you turn 31 on 01/06/2009 you can join on or before 30/06/2009 and not pay LHC loading, but if you joined 01/07/2009 you'd be considered 31 and pay an extra 2%.

LHC Loading only applies with Hospital cover.

2- Medicare Levy Surcharge
High income earners (relative term :rolleyes:) pay both the standard 1.5% medicare levy AND an additional 1% medicare levy surcharge (MLS). You can be exempt from this additional MLS by purchasing a private hospital cover with an excess of $500 or less. Any cover with an excess higher than $500 does nothing (with the exemption of those with grandfathering by having held the cover since prior to July 00 and not having changed).