Australian Government Rebate on Private Health Insurance

When you take out hospital or extras cover, you nominate a rebate tier based on your annual household income. Your selected tier, along with the age of the oldest person on your policy, is used to determine how much the Australian Government will contribute towards your health insurance premium.

To claim the private health insurance rebate, you must:

1. Be eligible for Medicare
2. Have a complying health insurance product (all GMHBA hospital and extras covers are eligible for the rebate)
3. Be on either a Base Tier, Tier 1 or Tier 2, as determined by your annual income.

If your current income places you in Tier 3, you can still register for the rebate. Tier 3 has a 0% rebate applied, so while you won't receive any immediate benefit, you would already be registered if your income level drops into any of the lower tiers in the future.

Your rebate entitlements depend on your family status on 30 June, and different thresholds apply, depending on whether you have a single or family income.

Always let us know if your income has changed, so that we can make sure you’re receiving the correct rebate level.

You can claim the rebate as either a reduction on your insurance premium, or a lump sum refund at tax time. It’s up to you. If you want the premium reduction, you’ll need to fill out a rebate form and return it to GMHBA. To claim a lump sum at tax time, simply fill out the appropriate section in your tax return. Your accountant or tax professional can also help you with this step.

If you have Lifetime Health Cover loading (LHC) applied to your policy, please be aware that the government will not pay the rebate for the LHC loading component of your policy.

Please refer to the threshold table shown above to see the most up-to-date tiers. Also keep in mind that your tier could change, depending on the current income threshold rates, your family status and the age of the oldest person in your household.

If your annual income changes, you need to let us know, as this may affect the rebate amount you’re eligible to receive.

If you’re receiving your rebate as a reduced premium, and your rebate tier doesn’t match your taxable income, you may get a refund or have an extra amount to pay when you lodge your tax return. This isn’t a penalty, just an adjustment that reflects your actual earnings. To change your details, just get in touch.

If you decide to claim the rebate as a premium reduction, you'll be asked to choose a tier based on your estimated income. While there are no penalties for accidently estimating your income incorrectly, it can affect your income tax return for that financial year.

If your annual income changes, you need to let us know. We can help to make sure you’re receiving the correct rebate amount.

If you select a tier that is higher than your actual income, you'll end up receiving a lower rebate than what you're entitled to. If that occurs, you will receive a tax offset through your tax return for that particular financial year.

On the flip side, if you select a tier that is lower than your actual income, you'll receive a higher rebate than what you’re entitled to. If that happens, you may have to pay an extra amount when you lodge your tax return for that financial year.

Your rebate details (and other private health insurance tax statement information) is sent directly to the ATO each year, so it can be auto-filled as part of your income tax return.

The rebate applies to both hospital and extras covers, provided they're complying health insurance products (which all GMHBA hospital and extras covers are). That means, even if you have an extras-only policy, you can still potentially reduce your premiums.