Medicare Levy Surcharge - How it may affect you if you dont hold private hospital cover

The Medicare Levy Surcharge is an additional surcharge of 1% of taxable income imposed on people earning above defined income thresholds, who are eligible for Medicare but who do not hold an appropriate level of private hospital cover. This surcharge is in addition to the normal 1.5% Medicare Levy.

For the 2010-2011 financial year, the taxable income thresholds are:

• $77,000 for a single person; or

• $154,000 for families and couples. The family income threshold is adjusted by $1,500 for each dependant child after the first.

These thresholds are indexed annually by the Federal Government to keep pace with changes to average wages.

People earning over the above thresholds can avoid paying the additional Medicare Levy Surcharge by taking out an appropriate level of private hospital cover with a registered health insurer. An appropriate level of hospital cover is one which does not have an excess greater than $500 for single members or greater than $1,000 for couples, single parent or family members.

Members who take out private hospital cover with St.LukesHealth, will be exempt from paying the additional levy from the date the policy is effective on all hospital products except for our high excess product - Hospital 1000.

If you don't currently have hospital cover, go to our cover selector and join now.