Private Health Insurance Rebate Tiers 2025-26
The Australian Government subsidises private health insurance through the Private Health Insurance (PHI) rebate — a percentage of your premium paid by the government, based on your income and age. On an average Gold hospital policy, the rebate is worth up to $914 per year.
Many Australians are on the wrong rebate tier — either because their income has changed or they have never updated their details. This guide shows exactly how much you are entitled to and how to claim it.
2025-26 Rebate Percentages
Rebate rates are set by the Australian Government and apply from 1 April 2025 to 31 March 2026. They are based on your income for surcharge purposes (taxable income plus reportable fringe benefits, total net investment loss, and reportable super contributions).
| Tier | Singles income | Families income | Under 65 | 65-69 | 70+ |
|---|---|---|---|---|---|
| Base Tier | $97,000 or less | $194,000 or less | 24.608% | 28.710% | 32.812% |
| Tier 1 | $97,001 - $113,000 | $194,001 - $226,000 | 16.405% | 20.507% | 24.608% |
| Tier 2 | $113,001 - $151,000 | $226,001 - $302,000 | 8.202% | 12.303% | 16.405% |
| Tier 3 | Over $151,000 | Over $302,000 | 0% | 0% | 0% |
For families, the income thresholds increase by $1,500 for each dependent child after the first child.
Rebate Rates by Age Group
Under 65
| Income (Singles) | Income (Families) | Tier | Rebate |
|---|---|---|---|
| $97,000 or less | $194,000 or less | Base | 24.608% |
| $97,001 - $113,000 | $194,001 - $226,000 | Tier 1 | 16.405% |
| $113,001 - $151,000 | $226,001 - $302,000 | Tier 2 | 8.202% |
| Over $151,000 | Over $302,000 | Tier 3 | 0% |
Ages 65-69
| Income (Singles) | Income (Families) | Rebate |
|---|---|---|
| $97,000 or less | $194,000 or less | 28.710% |
| $97,001 - $113,000 | $194,001 - $226,000 | 20.507% |
| $113,001 - $151,000 | $226,001 - $302,000 | 12.303% |
| Over $151,000 | Over $302,000 | 0% |
Ages 70+
| Income (Singles) | Income (Families) | Rebate |
|---|---|---|
| $97,000 or less | $194,000 or less | 32.812% |
| $97,001 - $113,000 | $194,001 - $226,000 | 24.608% |
| $113,001 - $151,000 | $226,001 - $302,000 | 16.405% |
| Over $151,000 | Over $302,000 | 0% |
Source: PrivateHealth.gov.au, 2025-26 financial year. Family income thresholds increase by $1,500 for each dependent child after the first.
What the Rebate Is Worth in Dollars
The percentage means nothing without context. Here is what the rebate is actually worth per year, calculated using real average premiums from our analysis of 62,988 active health insurance products.
Singles (Under 65) — Annual Rebate Value
| Hospital Tier | Avg Premium ($/yr) | Base Rebate | Tier 1 | Tier 2 |
|---|---|---|---|---|
| Basic ($122/mth) | $1,459 | $354 | $236 | $118 |
| Bronze Plus ($172/mth) | $2,060 | $500 | $334 | $167 |
| Silver Plus ($264/mth) | $3,172 | $770 | $514 | $257 |
| Gold ($313/mth) | $3,761 | $914 | $609 | $304 |
- A Base tier earner (under $97K) on an average Gold singles policy gets $914 back per year — reducing their effective cost from $3,761 to $2,847
- Even a Tier 2 earner ($113K-$151K) on Gold gets $304 back
- A Tier 1 earner on Bronze Plus gets $334 back — roughly $28/month off their premium
- Tier 3 earners (over $151K) get zero rebate but face the Medicare Levy Surcharge if they do not have hospital cover
Families — Annual Rebate Value (Gold Hospital)
Family Gold premiums vary by state. Here is the rebate value on average family Gold premiums:
| State | Avg Gold Family ($/yr) | Base Rebate | Tier 1 | Tier 2 |
|---|---|---|---|---|
| NT | $6,277 | $1,525 | $1,017 | $508 |
| WA | $7,942 | $1,929 | $1,286 | $643 |
| SA | $8,606 | $2,090 | $1,394 | $697 |
| NSW | $8,812 | $2,140 | $1,427 | $713 |
| TAS | $8,848 | $2,149 | $1,433 | $716 |
| QLD | $9,314 | $2,263 | $1,508 | $754 |
| VIC | $9,372 | $2,277 | $1,518 | $759 |
Calculated from average Gold family premiums by state. Source: analysis of 62,988 active products, March 2026.
For a family in Victoria on Gold cover at the base rebate tier, the government contributes $2,277 per year — nearly $190/month off the premium.
How to Claim the Rebate
There are two ways to receive the rebate:
Tell your health fund your income tier and they reduce your premium by the rebate percentage. You pay less each month.
- Pros: Immediate savings, lower monthly outflow
- Cons: If your income changes during the year, you may need to repay some rebate at tax time
How to set it up: Call your fund or log in to your account and nominate your income tier. Most funds ask for this when you join.
Pay the full premium to your fund and claim the rebate as a tax offset when you lodge your tax return.
- Pros: No risk of overclaiming if your income fluctuates
- Cons: You wait until tax time to get the money back, and your monthly cash flow is higher
How to claim: Your health fund issues a tax statement each year. Your accountant or myTax includes this in your return automatically.
For most people, Option 1 (reduced premium) is more practical — the rebate reduces your monthly cost immediately. But if your income is volatile (e.g., freelancer, commission-based, investment income varies), Option 2 avoids the risk of overclaiming and having to repay at tax time.
Age Group Definitions
The rebate increases with age to reflect higher healthcare costs for older Australians. Your age is assessed as at 1 July of the financial year. The three age groups are: under 65, 65 to 69, and 70 and over. Each group receives a progressively higher rebate percentage within the same income tier.
For couples or families where partners are in different age groups, the rebate is calculated based on the older person's age group for the hospital component, and each individual's age for the extras component.
| Age Bracket | Base Tier Rebate |
|---|---|
| Under 65 | 24.608% |
| 65-69 | 28.710% |
| 70+ | 32.812% |
The difference between under-65 and 70+ base rebate on average Gold cover is an extra $305/year for singles.
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Common Rebate Mistakes
1. Wrong Income Tier Nominated
If your income has changed (new job, promotion, redundancy, retirement, parental leave) and you have not updated your rebate tier, you are either:
- Overclaiming (income went up) — you will owe money at tax time
- Underclaiming (income went down) — you are paying more than you need to each month
Update your income tier with your fund whenever your income changes significantly.
2. Not Claiming at All
Some policyholders — particularly those who set up their insurance years ago — never nominated a rebate tier. They are paying the full, unrebated premium.
Call your fund and nominate your tier. The rebate will apply from your next billing cycle. You can also claim the current financial year's rebate on your tax return.
3. Forgetting the Age-Based Increase
Australians aged 65-69 and 70+ receive higher rebate percentages at every income tier. If you or your partner recently turned 65 or 70, update your fund — the rebate increase will not apply automatically.
4. Not Accounting for Dependants
The family income threshold ($194,000) increases by $1,500 for each dependent child after the first. If you have 3 children, your threshold is $194,000 + (2 x $1,500) = $197,000. This could move you to a lower tier with a higher rebate.
Rebate and the Medicare Levy Surcharge
The PHI rebate and the Medicare Levy Surcharge (MLS) work together:
| Income (Singles) | Without Hospital Cover (MLS) | With Hospital Cover (Rebate) |
|---|---|---|
| $97,000 or less | No MLS | 24.608% rebate |
| $97,001 - $113,000 | 1.0% MLS ($970-$1,130/yr) | 16.405% rebate |
| $113,001 - $151,000 | 1.25% MLS ($1,413-$1,888/yr) | 8.202% rebate |
| Over $151,000 | 1.5% MLS ($2,265+/yr) | 0% rebate |
For higher earners, the choice is clear: pay the MLS (with no cover) or pay for hospital insurance (with or without rebate). In most cases, the insurance costs a similar amount to the MLS — and you actually get health cover in return.
- Without insurance: 1.25% MLS = $1,625/year (no cover)
- With Basic hospital ($122/mth before rebate): $1,459/year minus 8.202% rebate ($118) = $1,341/year (with cover)
- The insurance is $284 cheaper than the surcharge — and provides hospital cover
Rebate and Other Incentives
| Incentive | Interaction with Rebate |
|---|---|
| LHC Loading | The rebate is calculated on the loaded premium (base + loading). If you have loading, you get a slightly higher dollar rebate — but you still pay more overall. See our LHC loading guide. |
| Excess | Choosing a higher excess reduces your premium, which reduces the dollar value of the rebate. But the net cost (premium minus rebate) is still lower with a higher excess. |
| Extras cover | The rebate applies to both hospital and extras premiums. Dropping extras reduces your total premium and rebate, but saves money net. |
| Annual payment | The rebate applies to the annual premium amount. Paying annually with a fund discount means your rebate is calculated on the discounted amount. |
How Income Is Calculated for Rebate Purposes
Your rebate tier is determined by your income for surcharge purposes, which is broader than your taxable income alone. It includes:
- Taxable income — your assessable income minus deductions
- Reportable fringe benefits — the grossed-up value shown on your payment summary
- Total net investment loss — losses from negatively geared investments added back
- Reportable super contributions — employer and salary-sacrificed super above the base rate
For families, the combined income of both partners is used. This means salary sacrificing into super still counts towards the threshold, as do investment property losses that reduce your taxable income.
How to Check Your Current Rebate Tier
- Call your health fund — they can tell you what tier is currently applied to your premium
- Check your tax return — your last return shows the rebate claimed or adjustment made
- myGov / ATO — your tax records show your nominated tier and any adjustments
- Your fund's app or website — most funds display your current rebate tier in account settings
Related Guides
Frequently Asked Questions
See your actual rebate on real plans
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General information only. This is not financial or tax advice. Rebate percentages are for the 2025-26 financial year as published by the Australian Government. Rates are reviewed annually and may change. Premium data from analysis of 62,988 active health insurance products, March 2026. Sources: PrivateHealth.gov.au, ATO, Health.gov.au. Consult a qualified tax professional for personalised advice.