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How to claim the Health Insurance Rebate

Claiming the Rebate

If you are eligible for the rebate, there are two ways you can claim:

  •     through a reduced premium;

  •     through your tax return with ATO;

If you choose to receive your rebate through your insurer, you will be asked to nominate the tier you expect to fall into in order to avoid a tax liability. You can nominate your tier by contacting your insurer or by filling out the Medicare rebate claim form.

Premium Reduction

Members can register under the premium reduction scheme by completing the "Application to Receive the Federal Government Rebate as a reduced premium" form and forwarding it with your application to HICA, or by applying directly to your health insurance fund.

The reduced premium claim form can be downloaded and is available from any Medicare Office or health fund.

Tax rebate

Members can claim the Federal Government Rebate on Private Health Insurance at the end of the financial year in their tax return. The rebate is also available as a refundable tax offset where any surplus above an individuals tax liability can be refunded to the taxpayer. This facility makes the rebate available through the tax system equally to both lower and higher income earners.

 

What happens if I nominate an incorrect tier?

If you choose to claim the rebate as a premium reduction or a payment from Medicare, you will be asked to nominate a tier based on your estimated income.

If you nominate a tier that results in a lower rebate than your income entitles you to, you will receive a tax offset through your tax return at the end of the financial year.

If you nominate a tier that results in a higher rebate than your income entitles you to, you will incur a tax liability through your tax return at the end of the financial year. This means you could have a tax debt. There are no additional penalties for estimating incorrectly.

Your private health insurer will give you a statement at the end of the financial year to help you complete your tax return..

Removal of the rebate on Lifetime Health Cover from 1 July 2013

Lifetime Health Cover (LHC) is a financial loading applied on top of your hospital premium at a rate of 2% for every year you are aged over 30 when you take out hospital cover, up to a maximum of 70%. The LHC loading is removed once you have held hospital cover and paid the loading for 10 continuous years.

If you currently pay a LHC loading, as of 1 July 2013, the Rebate will no longer apply to the LHC component of your hospital cover premiums. You will still receive the Rebate on the standard component of your hospital cover.