If you earn over a certain amount and don’t have private hospital cover, you may have to pay an extra fee at tax time. This is called the Medicare Levy Surcharge (MLS).
The MLS is set by the Government and is designed to ease stress on the public system by encouraging people to use private hospital services.
To avoid paying the MLS, you need private health cover that includes hospital treatments, not just extras or ambulance.
MLS at a glance
- Affects singles earning over $105,000 and couples or families earning over $210,000.^
- Is added to your tax at the end of the financial year.
- May be up to 1.5% of your earnings.
- May be avoided if you hold hospital cover for the full financial year.
*Minimum direct debit frequency is fortnightly. Price is for a single in NSW under the age of 65. No Lifetime Health Cover loading or age-based discount applied. Includes base tier Australian Government Rebate. Hospital cover price is based on an excess of $750.
Want more options? View all hospital cover
Hospital cover costs Liz $62.02 less than the MLS.
|
Basic Accident Only Hospital cover |
Medicare Levy Surcharge (no hospital cover) |
|
|---|---|---|
| Cost per year | $1037.98# | $1,100 |
| $0 Medicare Levy Surcharge |
|
|
| Private room guarantee** | |
|
| Skip public waiting lists | |
|
These are only examples. Always contact us for the most accurate quote based on your personal circumstances.
# Price includes the Australian Government Rebate and age-based discount, with no Lifetime Health Cover loading.
Private health insurance rebate
Lifetime Health Cover (LHC) loading
Age-based discount
Anyone who holds suitable private hospital cover for the full financial year or earns less than the Medicare Levy Surcharge income thresholds shouldn’t have to pay the Medicare Levy Surcharge at tax time. You can learn more on the ATO’s website.
If you earn more than the Medicare Levy Surcharge (MLS) income thresholds, you shouldn’t have to pay any MLS if you have suitable private hospital cover for the full financial year.
If you earn more than the MLS income thresholds and only hold suitable private hospital cover for part of the financial year, you’ll just have to pay the MLS for the days you weren’t covered.
If you earn more than $105,000 as an individual or $210,000 as a couple or family, you may have to pay the MLS. The Medicare Levy Surcharge is separate to the 2% Medicare levy most Australians pay. The MLS is calculated with the rest of your tax at the end of the financial year.
If you need to pay the MLS, it will be calculated as 1%–1.5% of your total taxable income. Similarly to income tax brackets, the higher your income, the higher your MLS will generally be. To learn more about what constitutes income for MLS purposes, visit the ATO website.
- Avoid the Lifetime Health Cover loading
The Lifetime Health Cover (LHC) loading is an extra cost added to the price of private hospital cover if you buy it after your 31st birthday. Learn more about LHC
-
Age-based discount
If you're under 30, the earlier you get private hospital cover, the more long-term discounts you can unlock. Learn more about discounts.
- Private Health Insurance Rebate
The Australian Government may help pay towards the cost of your private hospital cover, depending on your age and income. Check your eligibility
The information on this page and this calculator is a guide only and is not tax or financial advice. It does not take into account your personal circumstances and you should seek your own tax and financial advice.
^ Applicable rebate percentages and income thresholds are reviewed annually by the Australian Government. Single parents and couples (including de facto couples) are subject to family tiers. For families with children, income thresholds are increased by $1,500 for each Medicare Levy Surcharge dependant child after the first child. For more information, visit the ATO website.
† If claimable from another source, a benefit won’t be paid by Bupa. Benefits for ambulance transportation is only payable where the provider describes the transportation as an ‘Emergency’. For more, see the Important Information Guide. There is a 1 day waiting period for emergency ambulance and on-the-spot treatment.
** Subject to availability and eligibility. Private room must be booked and requested at least 24 hours before admission. For every night a private room is unavailable, you’ll receive $50 back per night from the hospital. Applies to overnight admissions only. Excludes nursing home type patients, emergency care, same-day stays or where a private room is not medically appropriate. Not available in the NT. Any co-payment excess as part of your cover will still apply.