Australian Government Rebate on Private Health Insurance
The Australian Government provides an income-tested rebate to help people meet the cost of private health insurance.
A person may claim the private health insurance rebate if they:
- are eligible for Medicare
- have a complying health insurance product (CHIP) that provides hospital treatment, general treatment (also known as ancillary or extras) cover or both, and
- have a taxable income for Medicare Levy Surcharge (MLS) purposes as shown in the table below.
From 1 July 2023 to 30 June 2024, the income thresholds used to determine a person’s eligibility for the rebate are based on the following table:
| Base Tier | Tier 1 | Tier 2 | Tier 3 | |
|---|---|---|---|---|
| Singles | $93,000 or less | $93,001-$108,000 | $108,001-$144,000 | $144,001 or more |
| Couples / Families | $186,000 or less | $186,001-$216,000 | $216,001-$288,000 | $288,001 or more |
Note: Single parents and couples (including de facto couples) are subject to the family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first.
The income threshold rates will be updated on 1 July 2024 and will be as follows for the period 1 July 2024 to 30 June 2025:
| Base Tier | Tier 1 | Tier 2 | Tier 3 | |
|---|---|---|---|---|
| Singles | $97,000 or less | $97,001-$113,000 | $113,001-$151,000 | $151,001 or more |
| Couples / Families | $194,000 or less | $194,001-$226,000 | $226,001-$302,000 | $302,001 or more |
Note: Single parents and couples (including de facto couples) are subject to the family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first.
The Private Health Insurance Rebate levels are based on the Rebate Adjustment Factor and may be updated annually on 1 April.
There are no changes to the rebate percentage levels for the period 1 April 2024 to 31 March 2025.
Private Health Insurance Rebate percentages from 2023-25:
| Base Tier | Tier 1 | Tier 2 | Tier 3 | |
|---|---|---|---|---|
| Rebate Entitlement | ||||
| Under 65 | 24.608% | 16.405% | 8.202% | 0.00% |
| 65-69 | 28.710% | 20.507% | 12.303% | 0.00% |
| 70+ | 32.812% | 24.608% | 16.405% | 0.00% |
The tiers are based on your taxable annual income for Medicare Levy Surcharge purposes.
Medicare Levy Surcharge
The Medicare Levy Surcharge (MLS) is an additional tax which Australians need to pay if they are without private health insurance hospital cover and have an annual taxable income over $93,000 as a single or $186,000 as a couple/family. If you do not hold an eligible hospital cover (or if you drop your hospital cover) you will have to pay additional tax on top of the standard Medicare Levy that applies to all Australian taxpayers.
The amount that you pay is based on income tiers. The MLS income tiers for the period from 1 July 2023 to 30 June 2024 are as follows:
- Tier 1 – A 1% Medicare Levy Surcharge will be paid by people with a taxable income ≥ $93,000 as a single or $186,000 as a family
- Tier 2 – A levy of 1.25% will apply to people with a taxable income ≥ $108,000 as a single or $216,000 as a family
- Tier 3 – A levy of 1.5% will apply to people with a taxable income ≥ $144,000 as a single or $288,000 as a family
| Base Tier | Tier 1 | Tier 2 | Tier 3 | |
|---|---|---|---|---|
| Singles | $93,000 or less | $93,001-$108,000 | $108,001-$144,000 | $144,001 or more |
| Couples / Families | $186,000 or less | $186,001-$216,000 | $216,001-$288,000 | $288,001 or more |
Note: Single parents and couples (including de facto couples) are subject to the family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first.
The MLS income threshold rates will be updated on 1 July 2024 and will be as follows for the period 1 July 2024 to 30 June 2025:
| Base Tier | Tier 1 | Tier 2 | Tier 3 | |
|---|---|---|---|---|
| Singles | $97,000 or less | $97,001-$113,000 | $113,001-$151,000 | $151,001 or more |
| Couples / Families | $194,000 or less | $194,001-$226,000 | $226,001-$302,000 | $302,001 or more |
Note: Single parents and couples (including de facto couples) are subject to the family tiers. For families with children, the thresholds are increased by $1,500 for each child after the first.
How to avoid the Medicare Levy Surcharge
You can avoid the MLS by keeping your hospital cover or adding a hospital cover to your policy. You’ll only be exempt from the MLS for the period during which you held this level of hospital cover. If you decide to leave and come back to private health insurance later, waiting periods and Lifetime Health Cover (LHC) loading may apply. Please note Extras cover (general treatment) alone will not provide an exemption; it must be packaged with an eligible hospital cover.
Some other health funds may offer hospital covers with higher excesses that are not exempt from the MLS. At GMHBA, all of our hospital covers are eligible due to our lower excesses.
More information
For more information about the Australian Government Rebate on private health insurance or the Medicare Levy Surcharge you can:
- visit ato.gov.au/privatehealthinsurance
- visit health.gov.au/privatehealth,
- call GMHBA on 1300 446 422, or
- consult a tax professional.