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Missing the LHC deadline of June 30 could cost you

Don't pay the Government Lifetime Health Cover (LHC) loading

If you take out hospital cover by 1 July following your 31st birthday you won't pay the LHC loading. Otherwise there's a 2% loading on top of the standard premium for each year you are over 30, to a maximum loading of 70%.

 

What is the Lifetime Health Cover loading?

Lifetime Health Cover is a Federal Government initiative designed to encourage you to take out private Hospital Cover earlier in life and maintain your cover. 

For every year you are aged over 30 and you do not have Hospital Cover, you will pay an additional 2% loading on top of your 'base' Hospital premium (or your share of a couple or family premium), when you do join. This is effective on 1 July following your 31st birthday.  For example, if you take out private Hospital Cover for the first time at age 40, you will pay 20% more than someone who joined at 30. The Lifetime Health Cover loading will cease once you have paid for 10 continuous years – as long as you retain your hospital cover. 

 

Avoiding the LHC is easy!

To avoid the LHC loading, take out any Health Partners hospital or package cover by 1 July following your 31st birthday.


Missing the LHC deadline of June 30 could cost you

 

Calculations based on 2016 Fortnightly Single Bronze Hospital cover with the base tier rebate and 3% direct debit discount. The LHC amount will be added to your hospital cover and will remain in place for 10 continuous years.

 

 

 

 

Lifetime Health Cover loading table

​Certified Age  Lifetime Health Cover Loading    Certified Age  Lifetime Health Cover Loading 
 30 0%     48  36%
 31 2%     49  38%
 32  4%    50  40%
 33  6%    51  42%
 34  8%    52  44%
 35  10%    53  46%
 36  12%    54  48%
 37  14%    55  50%
 38  16%    56  52%
 39  18%    57  54%
 40  20%    58  56%
 41  22%    59  58%
 42  24%    60  60%
 43  26%    61  62%
 44  28%    62  64%
 45  30%    63  66%
 46  32%    64  68%
 47  34%    65  70%

Exceptions

You may be eligible for an exemption of Lifetime Health Cover loadings if:
  • you were born on or before 1 July 1934
  • you have been living overseas since 1 July following your 31st birthday or since 1 July 2000
  • you have migrated to Australia and recently become eligible for Medicare benefits
  • you hold or have held a Gold Card
  • you are a member of the Australian Defence Force. 

Additionally, Norfolk Island residents have until 30 June 2017 to take out private hospital cover without incurring an LHC loading. If residents choose to take out private health insurance after this date, standard LHC rules will apply – that is, a loading of 2% will be incurred on hospital insurance premiums for each year of age over 30 from the time hospital cover is taken out.

Permitted Days

Permitted days are the number of days you are able to drop your Hospital Cover without affecting your loading. You can drop your Hospital Cover for a cumulative period of 1,094 days (i.e. 3 years less 1 day). Once you have used these permitted days without hospital cover, a 2% loading will apply for each year or part year you are without Hospital Cover.

You can drop your cover without using permitted days and without affecting your loading when:

  • you have suspended your membership
  • you are overseas for at least 12 months. You can return to Australia for visits of up to 90 days at a time and still be considered to be overseas.
Note: The Australian Government Rebate on private health insurance does not apply to the Lifetime Health Cover loading.

Removal of LHC loading after 10 years

Your LHC loading can be removed after you have completed 10 years of continuous cover. 

Please note that although you can break up your 10 years of continuous cover with any of the above permitted periods without hospital cover, the breaks in cover do not count towards the 10 years. Eg. if you pay your loading for 9 years and then cancel your cover while living overseas for several years, you will still have to pay 1 more year of loading on re-joining for the loading to be removed.

You should also note that if you use up your full 1094 permitted days, the continuity of your 10 year period of cover is broken.  If you re-join hospital cover after exceeding the 1094 days, you will have to pay an increased loading and you will have to restart your 10 years of continuous cover from the date of re-joining.

Please contact us for more details, or visit privatehealth.gov.au.

 

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