Millions of Australians cop extra tax to skip private hospital cover
- Jun 26
- 2 min read
More Australians are choosing to go without private hospital insurance and pay the Medicare levy surcharge instead.
New figures from the Australian Taxation Office show the number of people paying the surcharge has increased by 15 per cent in the past year and 74 per cent over three years.
The surcharge applies to higher-income earners who do not have private hospital cover. It adds an extra 1 to 1.5 per cent of their income on top of the standard Medicare levy.
From July 1, the income threshold will rise from $101,001 to $105,001. However, with the average full-time salary now around $106,950, more workers could fall into the surcharge bracket.
People earning above $105,000 without hospital cover will pay at least about $1,050 a year. Those on higher incomes will face larger costs, with the top rate reaching 1.5 per cent for earners above $164,000.
Analysis from Canstar suggests some Australians may save money by taking out basic hospital cover, with some entry-level policies costing less than the average surcharge.
However, cheaper policies often provide limited benefits.
Health insurance premiums also increased by an average of 4.41 per cent in April, making higher-level policies harder for many households to afford.
Gold hospital cover, which includes services such as pregnancy and birth, can cost thousands more each year compared with lower-tier options.
Experts say many Australians are now weighing up whether paying the surcharge or keeping private health cover offers better value, as rising living costs continue to pressure household budgets.
Source : 9 News
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