Private health insurance is a mandatory requirement for a number of visa subclasses such as the 457 Temporary (Skilled) visa. Once obtaining permanent resident status, some people choose to opt out of private health cover and rely solely on Medicare.
It is important to understand that Medicare does not cover everything, whilst you will receive a rebate for visits to general practitioners and some specialist services are covered, a trip in an ambulance could cost you thousands of dollars. Furthermore expensive medical services may not be covered by Medicare or you could have to wait very long time (sometimes years) in order to access specialist care. Choosing the appropriate level of private cover for your stage of life can reduce stress and anxiety, as you can access services that you may not have been able to afford.
Having private hospital cover may save you on tax. The Medicare Levy Surcharge (MSL) applies to Australian taxpayers who do not have appropriate level of private patient hospital cover and earn above an income threshold. It is paid in addition to the Medicare Levy is used to fund Australia’s public health system. Please contact your tax advisor or the Australian Tax Office if you require information on the MSL.
The Lifetime Health Cover Loading (LHC) comes into effect after 1 July, following on from your 31st birthday. If you do not have private health cover (prior to turning 31), you could pay an additional 2% for every year you don’t have private hospital cover, up to a maximum of 70%. The LHC will remain in place for 10 years.
Please contact Expat if you need assistance in arranging private health insurance.