Changes to private health insurance rebate and Medicare levy surcharge

For an explanation of terms used, see Definitions.

Changes to the private health insurance rebate

A number of changes have been introduced to the private health insurance rebate. From 1 July 2012:

• You are income tested on your share of the payments made for a private health insurance policy (whether you made the payments or not).
• Payments to private health insurance are tested against three new income thresholds to determine if you are entitled to a rebate from the government.

This means that if you have private health insurance both of the following apply:

• The amount of private health insurance rebate you are entitled to receive is reduced if your income is more than a certain amount.
• We determine the amount of private health insurance rebate you are entitled to receive when you lodge your tax return.

This may result in you receiving a refund or a liability depending on how you claim your rebate.

If you do not have an appropriate level of private patient hospital cover, and your income is more than a certain amount, a higher rate of Medicare levy surcharge may apply.

Sections within Changes to the private health insurance rebate

• Income test thresholds for 2012-13
• Income that the test applies to
• Estimating your income
• Income testing on your share of the policy
• What income threshold applies