On this page
- How does the rebate work?
- How do you get the rebate?
- How much rebate do you get?
- Lifetime Health Cover
- When to update your rebate tier
- How to change your rebate tier
How does the private health insurance rebate work?
The Australian Government may pay up to 32% of cost of your private health insurance, depending on your age and how much you earn.
It was introduced in 1999 to encourage more people to take our private health insurance, and by doing so partly reducing the stress on the public health system.
How do you get the rebate?
You have two ways to claim the private health insurance rebate – as a reduction to the cost of your private health insurance, or as a tax offset.
Getting the rebate with Police Health
Police Health relies on you to provide us the correct information about the earnings bracket of yourself and your partner’s earnings bracket (if applicable).
This allows us to set your premium amount correctly.
Claiming the rebate through tax
We don’t penalise you if you choose a lower income tier than you’re in and therefore claim a higher rebate.
However, if you do this the Australian Tax Office (ATO) will charge you for any shortfall in your tax – which may be a nasty surprise.
Alternatively, if you mistakenly put yourself in a higher earning bracket than the one you’re in you’ll likely get a refund from the ATO.
Please note there may be other financial considerations to think of when making this decision. For more information, go to the ATO’s ‘Private health insurance rebate’ page.
How much rebate do you get?
The table below reflects the latest changes to the income tiers which came into effect from 1 July 2023.
On 1 July 2023, the income thresholds that are used to calculate the private health insurance rebate increased – by around $3,000 for singles and $6,000 for families.
These increases mean that depending on your income level, you may be eligible for a higher rebate on your private health insurance.
The government may adjust the rebate percentage on 1 April each year, in line with health insurance premium increases. This year, the Rebate will stay the same until 1 April 2025.
From 1 April 2014, the rebate contribution from the Australian Government has been calculated based on a Rebate Adjustment Factor.
The Rebate Adjustment Factor is determined using a formula which takes into account growth in the Consumer Price Index and the industry weighted average premium increase.
Private Health Insurance Rebate effective from 1 April 2025 to 31 March 2026
Singles Families |
Base Tier $97,000 or less $194,000 or less |
Tier 1 $97,001-$113,000 $194,001-$226,000 |
Tier 2 $113,001-$151,000 $226,001-$302,000 |
Tier 3 $151,001 or more $302,001 or more |
|---|---|---|---|---|
| < Age 65 | 24.288% | 16.192% | 8.095% | 0% |
| Age 65-69 | 28.357% | 20.240% | 12.143% | 0% |
| Age 70 + | 32.385% | 24.288% | 16.192% | 0% |
Does the Lifetime Health Cover loading apply to my rebate?
No, if you have Lifetime Health Cover (LHC) loading, the private health insurance rebate does not apply to the LHC component of your cover.
You can think of the LHC loading as a surcharge for not having insurance earlier. The government discount only applies to the regular cost of your insurance, not the surcharge.
When should I update my rebate tier?
There are three main points to consider when updating a rebate tier – income change, marital status change and age change.
Income change
If your income goes up or down significantly, you might qualify for a different rebate tier. This could mean getting a bigger discount or even losing eligibility altogether.
Marital status change
Getting married, separated, or divorced can affect your rebate tier. As a couple, your income is combined, potentially pushing you into a different tier.
Age change
If you come under the Base Tier, Tier 1, and Tier 2 you can update your income age when you turn 65 and 70.
This is because at these birthdays your rebate will increase (as of 7 March 2024), reducing the cost of your private health insurance.
How do I change my rebate tier?
If you're a member with Police Health, it’s simple. Call us on 1800 603 603 or email us at enquiries@policehealth.com.au.