What are the government incentives and penalties that affect my health insurance price?  

There are 2 incentives and one penalty provided by the government to encourage you to take out Private Health Insurance.  

The incentives for health insurance may reduce the price you ultimately pay. The incentives are: 

— Government Rebate

Also known as the Private Health Insurance Rebate, the Government Rebate reduces your health insurance premium. The Rebate is based on your family status, income, age and number of dependent children. You can use the Rebate to lower the price you pay for health insurance, or to get a refund at tax time. 

— Age-based Discount

The Age-based Discount is a discount up to 10% on Hospital Cover that some insurers offer to people aged 18 to 30. It lasts until the age of 41 if Hospital Cover is maintained continuously and is then gradually phased out. It is calculated at 2% for each year you are under 30, up to a maximum of 10%. Not all insurers offer the Age-based Discount. 

There is one penalty imposed by the government which may increase your health insurance premium.  

— Lifetime Health Cover Loading

The government encourages people to take out health insurance earlier in life through the Lifetime Health Cover Loading which can increase the premium. Anyone starting Hospital Cover after the age of 31 will pay a penalty of 2% for every year after 30, which remains in place for 10 years.  

The Medicare Levy Surcharge (MLS) is another form of penalty the government imposes to encourage people to take out Private Health Insurance but it does not affect your health insurance price. The MLS is an extra charge you must pay with your taxes if you earn over a certain threshold and do not have Hospital Cover.