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Australians await outcome of means testing bill

27 July 2011 - 6:12pm

Australians may want to check their taxable income to see how they will fare in the government's proposed legislation to means test the private health insurance rebate.

The bill has been rejected twice before, with a third attempt still being debated in the senate.

If the legislation is passed, some policyholders may not be eligible for the current 30 per cent rebate for their health insurance premiums.

According to a parliamentary report, there will be three tiers that decide rebate eligibility.

Individuals falling into tier three (incomes over $124,000) would receive no rebate.

Tier two, for those earning over $93,000, would receive a ten per cent rebate and those in tier one (earnings over $80,000) would receive a 20 per cent rebate.

Those with incomes below tier one will receive the full refund.

The Medicare levy surcharge (MLS) for those without cover could also increase depending on their level of income.

Parliament will continue debate on the bill when it resumes on August 16.

If the bill is passed, rather than reconsidering their private health insurance, policyholders may benefit by consulting a health cover broker who can advise them of any better deals to ensure their treatment stays covered.