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  • Lifetime health cover

    Lifetime health cover (LHC) is a government initiative designed to encourage you to purchase and maintain private patient hospital insurance cover earlier in life.

    If you have not taken out and maintained private hospital health insurance from the year you turn 31, you will pay a 2% LHC loading on top of your premium for every year you are aged over 30 if you decide to take out hospital cover later in life.

    For example, if you wait until you are 40 years old you could pay an extra 20% on the cost of your hospital cover. If you wait until you are 50 years old, you could pay 40% more. The maximum LHC loading that can be applied is 70%.

    LHC loading is not paid by all people. To avoid incurring an LHC loading, residents of Australia must ensure they hold an appropriate level of private patient hospital cover before they reach their LHC 'base day'.

    For many people, LHC base day is 1 July following their 31st birthday, but this can change depending on personal circumstances.

    LHC loadings apply only to private patient hospital cover – they do not apply to general treatment cover (also known as ancillary or extras cover).

    The government does not pay the private health insurance rebate on LHC loading applied to the costs of a policy.

    Example: No private health insurance rebate on LHC loading

    On 1 July 2017, Rebecca pays a premium of $220 for two months of cover under a complying health insurance policy. Due to Rebecca’s circumstances, she incurs a 10% increase in her premium because of the LHC loading. The premium eligible for the rebate (excluding any LHC loading) is $200. The LHC loading is $20. Rebecca's income is $59,000 and she is eligible for the 25.934% rebate.

    Rebecca receives a rebate of $52, which is 25.934% of the $200 premium eligible for the rebate. Rebecca does not receive any rebate on the $20 paid for LHC loading.

    End of example

    See also:

    Last modified: 29 Jun 2018QC 49963