Private Health Insurance FAQs

What’s private health insurance?

Private hospital insurance is an affordable way to choose your own hospital, doctor and timeframe. Extras cover helps you to pay less for dental, physiotherapy, optical, chiropractic and a range of other everyday health services generally not covered by Medicare. Watch this video on some of the benefits of having health cover.

Australian Government Rebate on private health insurance

How can I claim the Australian Government Rebate?

You can claim the Australian Government Rebate as a reduction on your premium (this requires a completed Australian Government Rebate Application form), or as a rebate through your annual tax return.

What happens if I nominate an incorrect rebate tier?

When you lodge your income tax return, the Australian Taxation Office (ATO) will determine your rebate entitlement, which could mean you get a refundable tax offset or a tax liability.

Do I need to let my health fund know what my income is to determine my rebate tier?

No. You shouldn't report your income to your health fund; you just need to nominate your tier.

If my income falls into Tier 1, 2 or 3, can I continue to claim any of the rebate amounts as a reduction on my premiums?

Yes, you can receive any rebate amount you select. But when you submit your tax return, the ATO will determine whether you've claimed a higher rebate than you're entitled to and will seek reimbursement in your tax assessment. If you've claimed a lower rebate than you're entitled to, you could get a refundable tax offset in your tax assessment.

What happens if any member of our family passes away?

If any member of your family dies, family thresholds will continue to apply for that financial year. If a dependant child dies, any increase in the thresholds due to that child will also apply for the rest of that financial year.

How does the rebate affect employer-purchased cover?

Where employers fully or partially subsidise private health insurance as an employee benefit, this is a private arrangement between employer and employee. Employees (i.e. the adults covered by the policy) can still nominate a rebate tier and make up the difference in premiums if required.

Who's entitled to the rebate for dependant child only policies?

Parents with dependant child only cover are still income tested and may be entitled to the rebate. The rebate applies to the parent whose Medicare details are registered on the policy.

What happens if my or my family’s income changes from one tier to another during the financial year? 

There's no penalty for changing tiers during the financial year. If you've claimed too much private health insurance rebate, as a premium reduction or through Medicare, the ATO may seek to recover the amount. This liability will be listed on your assessment notice.

If you haven't received your full rebate entitlement, the ATO will calculate your rebate and refund this to you as a tax offset when you lodge your tax return. The tax offset will be listed on your assessment notice.

Is the rebate applicable to the Lifetime Health Cover (LHC) loading on private health insurance?

No, the LHC loading component of your premium isn't eligible for the rebate even if you're eligible for a rebate overall. To learn more about the Australian Government Rebate, visit the ATO.

What's Lifetime Health Cover?

People who take out hospital cover before the age of 31 and keep it can maintain lower premiums. From 1 July following your 31st birthday, you'll pay 2% more for each year you don't have hospital cover (up to 70%). You'll be required to pay the extra amount for 10 years. If you're already over 31, take out hospital cover as early as possible to avoid paying any extra.

Medicare Levy Surcharge

If you're single and earn more than $93,000, or a family or couple earning more than $186,000 a year (increasing by $1,500 for each dependant child after the first) from 1 July 2023, you may be required to pay the Medicare Levy Surcharge. You can avoid any additional Medicare Levy Surcharge by having an appropriate level of hospital cover.

The income thresholds from 1 July 2023 are
Australian Government Rebate tiers
Type of member No tier Tier 1 Tier 2 Tier 3
Singles < $93,001 $93,001 - $108,000 $108,001 - $144,000 > $144,000
Families < $186,001 $186,001 - $216,000 $216,001 - $288,000 > $288,000
Medicare Levy Surcharge
All ages 0.0% 1.0% 1.25% 1.5%

For more information on the Medicare Levy Surcharge.


What's Medicare?

Medicare is Australia's public health system. It covers all Australian citizens and permanent residents. Medicare is partly funded by a levy on taxable income. It covers services such as public hospital treatment and doctors' services.

Why is Medicare not enough?

You'll often find public hospitals have long waiting lists for non-urgent operations – and you won't be able to choose the doctor you want. Also, Medicare doesn't cover ambulance costs.

What does Medicare cover?

While Medicare is acknowledged as one of the world's best public health systems, it mainly covers things like:

  • treatment at general and specialist practitioners
  • treatment at public hospitals
  • a portion of the cost of medical treatment in private hospitals by surgeons, anaesthetists and other specialists.

What can private health insurance cover that Medicare doesn't?

  • hospital insurance can cover you for hospital accommodation and theatre fees at private hospitals (for services listed on your policy) and emergency ambulance travel, depending on your level of cover.
  • extras insurance can cover you for day-to-day health services, like dental treatments, glasses and contact lenses and physiotherapy, depending on your level of cover.

What's the Pharmaceutical Benefits Scheme (PBS)?

The Pharmaceutical Benefits Scheme (PBS) makes subsidised prescription medicines available to Australian residents and requires a PBS co-payment to be paid towards each item.

 If you're on eligible extras cover you may be able to claim up to $50 per script towards HCF-approved pharmacy items that your doctor prescribes, after an HCF co-payment equivalent to the current PBS co-payment for general patients is paid. For more information please check the current HCF Member Guide.

What's Savings Provision Entitlement?

It ensures that people remaining on a policy that has been eligible for the 35% or 40% Australian Government Rebate don't have their rebate amount reduced if the person aged 65 years or over leaves or cancels the policy.

The Savings Provision Entitlement only applies when the person 65 years or over leaves or cancels the policy after 1 April 2005. Anyone who's under 18, or a full-time student under 25, at the time the person leaves the membership can't inherit the 35% or 40% rebate.

Can I check how Australian health funds are performing?

The Private Health Insurance Ombudsman produces an annual State of the Health Funds Report to help consumers assess the relative performance and service delivery of each of the health funds.

To make a complaint, contact the Commonwealth Ombudsman at or on 1300 362 072.

What’s the private health insurance Code of Conduct?

HCF supports the Private Health Insurance Code of Conduct ensuring:

  • you will receive correct information on private health insurance
  • you are aware of the internal and external dispute resolution procedures
  • you can make an informed decision about your purchase through informative policy documentation
  • you are protected in accordance with privacy principles.

View the full code

What’s the Private Patients Hospital Charter?

HCF supports the Private Patients Hospital Charter, which outlines what members can expect from doctors, hospitals and their health fund.