Medicare Levy Surcharge

Take out hospital cover today and avoid the Medicare Levy Surcharge

If you earn over $97,000 a year on your own or $194,000 as a couple, family or single parent and you don’t have private hospital cover, you may have to pay the Medicare Levy Surcharge. This surcharge was introduced by the government to encourage people with higher incomes to get private health insurance and take pressure off the public health system.

Taking out eligible hospital insurance could help you pay less at tax time, so it’s worth checking if you’re paying the surcharge before the end of the financial year.

Medicare Levy Surcharge Calculator

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The information on this page and this calculator is a guide only and is not tax or financial advice. You should speak to a financial advisor who will be able to take into account your income and personal situation, including any changes that occur during a tax year. For more information on the Medicare Levy Surcharge, visit www.ato.gov.au

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How can I avoid paying the surcharge?

Taking out an eligible private Hospital cover with St Lukes may mean you don’t have to pay the Medicare Levy Surcharge from the date the policy is effective. This is for all hospital covers with the exception of our high excess product – Gold Hospital 1000.

Why choose St Lukes

Claim straight away

You can claim with us straight away when you sign up for the same level of cover as your old insurer (providing all waiting periods have been served).

We’re local

Whether it’s face-to-face at one of our seven customer care centres or over the phone with our Tasmanian team, nothing is as easy as dealing with a local. It’s service for Tasmanians, by Tasmanians.

We've got you covered with award-winning value and customer service

We have been awarded the Roy Morgan Customer Satisfaction Award for Private Health Insurer of the Year and Private Health Insurer of the Year (Not-for-profit). Additionally, we received the Canstar 2023 and 2024 Outstanding Value Award for hospital cover in Tasmania.

Switching to St Lukes is easy

We get that switching might seem a bit too hard… we make it easy, even contacting your old insurer to have the awkward ‘it’s-not-me-its-you’ conversation.

Frequently asked questions

: The Medicare Levy Surcharge is an additional government surcharge added at tax time for people earning above defined income thresholds, who are eligible for Medicare but do not hold an appropriate level of private hospital cover.

If your income for Medicare Levy Surcharge purposes is above the defined income thresholds set by the government, you will be required to pay an additional Medicare Levy Surcharge of up to 1.5% if you, your spouse and all your dependents don’t hold an appropriate level of private Hospital cover.
: To calculate your income for Medicare Levy Surcharge purposes, the following items are considered:

Taxable income

Reportable fringe benefits

Total net investment losses

Reportable super contributions

If you have a partner or spouse, their share of the net income of a trust on which the trustee must pay tax and which has not been included in their taxable income

Exempt foreign employment income.

Use our calculator above to estimate your surcharge for 2024-2025 financial year.
: If you have a partner or spouse, your combined income will be used to calculate your Medicare Levy Surcharge.

If you are a family with a combined income of more than $194,000, you may need to hold hospital cover for you, your partner and your dependents to avoid the surcharge. If your partner or one of your dependents is not covered, you will pay the surcharge unless an exemption applies.

For families with children, the income thresholds increase by $1500 for each child after your first child. For Medicare Levy Surcharge purposes, your child is still a dependent if you are paying child support while the child does not reside with you.

If you do have to pay the Medicare Levy Surcharge, it will be included with the Medicare levy and shown as one amount on your assessment called “Medicare levy and surcharge”.

For more information on the Medicare Levy Surcharge, visit www.ato.gov.au