Medicare - Health Insurance AU

Medicare covers 85 % of the Medicare Schedule fee. You’re responsible for the excess which is generally covered by your private health insurance.


Services include; Consultation fees for doctors and specialists, supporting medical procedures. These include X-rays and pathology tests and eye tests performed by optometrists.


excluded from the above mentioned are most dental procedures, contact lenses and private hospital cover again to be covered by private health insurance.


What cost will you incur?


There is no direct fee charged to join the national Medicare system. Instead, the cost to run the national Medicare system is recovered indirectly by levying each Australian taxpayer a base rate of 1.5 per cent of his or her taxable income.


Employers in Australia recover this base rate through the periodic PAYG tables.


Although the taking out of private health insurance covers is voluntary, if an Australian taxpayer fails to take out such cover (and is a so-called high income earner) a further 1 per cent Medicare levy surcharge will be added to such taxpayer’s liability. An important planning tip is for those entering Australia under an Australian temporary resident visa to apply for exemption from the Medicare levy charge.


If you don’t apply for the exemption certificate, you will not be refunded the Medicare levy collected, notwithstanding you did not and were not eligible for Medicare benefits. The exemption application form is also available from the Medicare website.


What are your Incentives for Private health Cover


For holders of an Australian permanent resident visa it is voluntary whether you wish to take out private health insurance. So the issue of the incentives is relevant to this class of visa holder. However, also important to recognise in the case of an Australian temporary visa holder, is that it is generally a condition imposed by the Department of Immigration that such a visa holder must take out private health cover.


The three main incentives available for persons who take out private health insurance in Australia are the ‘lifetime healthcover’ concession, the federal government rebate benefit and the waiver of additional Medicare levy surcharge.


Lifetime health Cover Concession


How does the lifetime health cover concession operate? In order to lock in the lowest premium for life, a person needs to take out hospital insurance cover by 1st July following their 31st birthday. Thereafter, for each and every year that person fails to take out such cover, a loading for life is added to the premium at the cumulative rate of 2 per cent per year.


For example, if a new Australian permanent resident migrant enters Australia at the age of 39 and fails to take out hospital insurance cover until the age of 45, they will pay 30 per cent more in premiums (as calculated to the default 30 years of age), even though his or her residence in Australia has only been for six years.


Charges for Federal Government Rebate Benefit


How much is the federal government rebate benefit? For persons under the age of 65 the rebate is 30 per cent, for persons between the ages of 65-69 the rebate is 35 per cent and for persons over 70 is 40 per cent. The rebate is applied annually as a reduction to the health insurance premium then payable.

medicare australia