If you’re over 31 years old and don’t have hospital cover, this could affect you.

Lifetime Health Cover (LHC) is a Government initiative designed to encourage people to take out hospital insurance earlier in life and maintain their cover.

Here's some examples

For a single 35 year old taking out private health insurance for the first time, your premium will attract an additional 8% loading on the base rate for hospital cover.

For couples and families, the loading is calculated based on an average of the ages of the covered adults. So for a couple aged 36 and 42, the combined loading would be 32% - but because there's two of you, this is halved to 16%, which is the final loading that applies to your joint policy.

Your joining age

The loading is frozen at the rate that matches your joining age, which is called your "Certified Age of Entry" (CAE), so the earlier you join, the lower your loading will be. So even if you’re already over 31, it still makes sense to join as soon as possible to secure a lower loading.

Once you’ve kept your private hospital cover for ten continuous years, you’ll stop paying that loading as a reward for your commitment to the private health system.

Under the Federal Government’s Lifetime Health Cover legislation the loading of 2% does not apply to Extras cover.

The following table shows how you might be affected by Lifetime Health Cover.

Joining Age Premium Loading Joining Age Premium Loading
30 or younger 0% 48 36%
31 2% 49 38%
32 4% 50 40%
33 6% 51 42%
34 8% 52 44%
35 10% 53 46%
36 12% 54 48%
37 14% 55 50%
38 16% 56 52%
39 18% 57 54%
40 20% 58 56%
41 22% 59 58%
42 24% 60 60%
43 26% 61 62%
44 28% 62 64%
45 30% 63 66%
46 32% 64 68%
47 34% 65 70%

Exceptions to the LHC loading

The LHC loading doesn’t apply to everyone. There are situations that might delay the application of the LHC, or avoid it altogether:

  • If you’ve had continuous hospital cover for the last 10 years
  • If you were born on or before 1 July 1934, you are exempt from Lifetime Health Cover
  • Members of the Australian Defence force*
  • Recent migrants who have become eligible for Medicare benefits (including migrants from New Zealand)*
  • If you are an Australian citizen or permanent resident who is overseas on the 1st of July after your 31st birthday, you will not pay a Lifetime Health Cover loading as long as you purchase hospital cover within a year of your return to Australia.

* Please refer to the Department of Health website for more information about when Lifetime Health Cover will apply in these instances.

Breaks in your cover

You are able to drop your hospital cover for a cumulative period of up to 2 years and 364 days during your lifetime without affecting your loading. For every year without cover after that, your loading will increase by 2%, in line with the LHC scheme.

When you transfer from another fund

If you’re transferring hospital cover from another registered fund, make sure you use your CAE (your joining age), rather than the age you are now, to calculate the correct loading so you don't pay more than you need to.

For more information on Lifetime Health Cover, please visit the Department of Health website.