Reciprocal Health Cover is an additional product that can be purchased in addition to your overseas visitors cover to help eliminate the Medicare Levy Surcharge. While it doesn’t offer you any additional benefits for health services, it could help save you money. At the end of the financial year, you’ll receive a tax statement which can be provided to the Australian Taxation Office to exempt you from paying the MLS.
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Overseas Visitors Cover
Reciprocal Health Cover
Working Overseas Visitors Cover + Reciprocal Health Cover = No need to pay Medicare Levy Surcharge
What is the Medicare Levy Surcharge?
Most Australian taxpayers pay an annual Medicare Levy on their taxable income each year. This helps fund Medicare, the public healthcare system that provides free or subsidised cover for certain healthcare services to Australian citizens and permanent residents. On top of this, if you do not have private health insurance you may be charged the Medicare Levy Surcharge (MLS) of between 1-1.5% depending on your income.
Will you need to pay the MLS?
The MLS is only applicable if you are on a working visa and:
- you earn more than $90,000 as a single person or $180,000 a year as a couple/family*; and
- you don’t have an appropriate level of private hospital cover for you and all your dependants, for the whole year; and
- you are from a country with a Reciprocal Health Care Agreement with Australia (RHCA); and
- you have a Reciprocal Medicare Card; and
- you have not purchased Reciprocal Health Cover (an additional cover that can be purchased by you to help eliminate the Medicare Levy Surcharge).
If you fall within the above criteria, please refer to the below tables to determine how much MLS you may need to pay.
How much MLS will I have to pay?
- Single
- Couples and Families
Scroll the table left or right to compare.
| Income | Up to $90,000 | $90,001 - $105,000 | $105,001 - $140,000 | More than $140,000 |
|---|---|---|---|---|
| Medicare Levy Surcharge | 0% | 1% | 1.25% | 1.5% |
Scroll the table left or right to compare.
| Income | Up to $180,000 | $180,001 - $210,000 | $210,001 - $280,000* | More than $280,000* |
|---|---|---|---|---|
| Medicare Levy Surcharge | 0% | 1% | 1.25% | 1.5% |
*On a family membership this increases by $1,500 per child after the first. The family thresholds also apply to single parent families and couples including de facto couples.
By purchasing Reciprocal Health Cover you may also be eligible to receive the Australian Government Rebate on your private health insurance.
What is the rebate?
The Australian Government Rebate on private health insurance (the 'rebate') is an initiative whereby, depending on your income, the Government may contribute an amount towards of the cost of your private health insurance. The rebate is reviewed annually and effective each year from 1 April.
Will you receive the rebate?
Depending on your income you may be entitled to receive the rebate if you:
- are from a country with a Reciprocal Health Care Agreement (RHCA) with Australia,
- have a Reciprocal Medicare Card; and
- have Extras cover included on your Overseas Visitors Cover or in addition. (the rebate is only available on your Extras cover), or
- have purchased Reciprocal Health Cover (an additional cover that can be purchased by you to help eliminate the Medicare Levy Surcharge).
The level of rebate you're entitled to is based on the age of the oldest person covered by the policy and by combined annual earnings.
What rebate am I entitled to?
- Single
- Couples and Families
Scroll the table left or right to compare.
| Income Thresholds# | Up to $90,000 | $90,001 - $105,000 | $105,001 - $140,000 | More than $140,000 |
|---|---|---|---|---|
| Rebate Tiers | Base Tier | Tier 1 | Tier 2 | Tier 3 |
| Rebate^ | ||||
| Up to 65 years | 25.934% | 17.289% | 8.644% | 0% |
| 65 - 69 years | 30.256% | 21.612% | 12.966% | 0% |
| 70 years and over | 34.579% | 25.934% | 17.289% | 0% |
Scroll the table left or right to compare.
| Income Thresholds# | Up to $180,000* | $180,001 - $210,000* | $210,001 - $280,000* | More than $280,000* |
|---|---|---|---|---|
| Rebate Tiers | Base Tier | Tier 1 | Tier 2 | Tier 3 |
| Rebate^ | ||||
| Up to 65 years | 25.934% | 17.289% | 8.644% | 0% |
| 65 - 69 years | 30.256% | 21.612% | 12.966% | 0% |
| 70 years and over | 34.579% | 25.934% | 17.289% | 0% |
^Rebate percentages are effective for payments made from 1 April 2017 and are indexed annually. #The income thresholds will remain the same from the 2016-17 financial year until 30 June 2018. For more information visit ato.gov.au. *On a family membership this increases by $1, 500 per child after the first. The family thresholds also apply to single parent families and couples including de facto couples.
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