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Lifetime Health CoverLifetime Health Cover was introduced in July 2000 and involves a financial loading in addition to standard hospital cover premiums for people who delay taking out hospital cover. People who take out hospital cover earlier in life and maintain their hospital cover, will pay lower premiums throughout their life compared to someone who joins when they’re older. To lock in the lowest premiums for life under Lifetime Health Cover, a person needs to take out hospital cover with a private health insurer by 1 July following their 31st birthday. If a person does not have hospital cover on 1 July following their 31st birthday and decides to take out hospital cover later in life, they will pay a 2% loading on top of their premium for every year they are aged over 30. For example, someone who first takes out hospital cover at age 40 will pay 20% more than someone who first took out hospital cover at age 30 or earlier. Any Lifetime Health Cover loading that a person is required to pay will cease if the person has had hospital cover for a continuous period of 10 years. Under Lifetime Health Cover, private health insurer members are able to drop their private health insurance cover for a cumulative period of 1,094 days in their lifetime without affecting their loading. For every 365 days without cover after that, the person's loading will increase by 2%. You can also apply to your health insurer to suspend your cover and this period of suspension counts as periods with private health insurance. People who were born on or before 1 July 1934 are exempt from Lifetime Health Cover and are able to join a health insurer at any time in the future and pay the same premium as someone who takes out cover at age 30. There are provisions and grace periods in place for Australians who were overseas on their 31st birthday or at the time Lifetime Health Cover was introduced, which may be applicable to you. New arrivals to Australia may also receive a grace period before the Lifetime Health Cover loading comes into effect. For Lifetime Health Cover purposes, time spent on Norfolk Island is classified as time spent overseas and this can have different effects depending on the actual dates you were resident on Norfolk Island. If you were a member of the Australian Defence Forces (ADF) on 1 July 2000, under Lifetime Health Cover you were granted a certified age at entry of 30. After discharge from the ADF, you will have access to your 1,094 days under the period of absence rules, to join a health insurer and still pay the base rate premium. An amendment to the National Health Act 1953 that was current prior to the new Private Health Insurance Act 2007 extended protection from the application of Lifetime Health Cover to persons issued with a Department of Veterans’ Affairs (DVA) Gold Card from 1 July 2004. If you held a Gold Card at any time since 1 July 1999, and the card was subsequently withdrawn by the DVA, you may claim the period you held the card as a period with private health insurance. If you held a Gold card on 1 July 2000, you will generally have a Lifetime Health Cover certified age of entry of 30. For more information about Lifetime Health Cover, check with your health insurer or visit the Lifetime Health Cover calculator at http://www.privatehealth.gov.au |
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Private Health Insurance Administration CouncilSuite 16, Level 1, 71 Leichhardt Street, KINGSTON ACT
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Last modified: 22 July, 2005 |