Are You Making the Most of Government Private Health Insurance Initiatives?
It’s no secret that private health insurance may be expensive. Regardless of whether you are purchasing a comprehensive policy in addition to your Medicare coverage, or just want hospital cover or ancillary cover, the bottom line is that purchasing private health insurance is going to cost you money.
However, there are government programs that may help you reduce the overall cost of your private health insurance. The Private Health Insurance Rebate is available to all Australian citizens, regardless of your age, income level, or whether your employer has paid your health insurance premiums for you. Additionally, other schemes to encourage taking out private health insurance cover may save you money over time.
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How To Get The Private Health Insurance Rebate
The easiest way to save money on your private health insurance is by taking advantage of the government-sponsored Private Health Insurance Rebate. You can get your Rebate in one of three ways:
- By asking your registered health fund to give you your Rebate as a premium reduction
- By contacting your local Medicare office to receive your Rebate as a direct payment from the Government.
- By using a statement provided by your health fund at the end of the year to claim your Rebate on your tax return.
Again, even if your employer has paid for your health cover as part of a benefits package, you are still entitled to the Private Health Insurance Rebate, and can claim it in either of the three ways listed above.
How Much Private Health Insurance Rebate Will You Get?
The amount of the Rebate you are eligible for will depend upon your age. The government Private Health Insurance Rebate schedule in 2011 entitles you to:
- a 30% Rebate if you are under 65,
- a 35% Rebate if you are aged 65-69,
- a 40% Rebate if you are 70 or over.
Other Ways to Save on Private Health Insurance
You can save even more on hospital cover by taking out a policy prior to your 31st birthday. Lifetime Health Cover (LHC), a Government initiative intended to reward people for taking out and maintaining hospital cover earlier in life, can save you money as long as you take out cover before your 31st birthday. After your 31st birthday, you’ll pay the 2% loading the Government assesses on top of your premium for every year you are over age 30.
Keeping the premiums paid for your private health insurance is encouraged, as well; even if you wait until after your 31st birthday to obtain cover, after you have paid the LHC loading on your cover for 10 years continuously, you are no longer responsible for the loading as long as you retain the hospital cover.
Although private health insurance cover may be expensive, taking advantage of Government programs that encourage purchasing cover may reduce the cost of your private health insurance, both initially and over time.
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