The end of the financial year is one of the busiest times in an accountant’s calendar. With last-minute requests from clients, looming deadlines from the ATO and your own business commitments, it can be easy to overlook a health check of your private health insurance or to explore taking out cover for the first time.

EOFY is an ideal time to review where you can get more value for money. If you’re considering private health cover for the first time, or thinking of switching to a new health fund, here are three reasons to explore your options before 30 June.

1. Avoid the Medicare levy surcharge

If your income exceeds the Medicare levy surcharge (MLS) threshold (more than A$101,000 for singles or a combined income of more than A$202,000 for couples from 1 July 2025) and you haven’t had eligible private health insurance for the entire financial year, you’ll incur the MLS for each day you did not hold an active hospital policy, if you’re an Australian resident for tax purposes. Think of it as an additional 1–1.5% tax on top of the 2% Medicare levy.

You could avoid paying the surcharge for the next financial year if you take out hospital cover with an Australian registered health fund before EOFY. But rather than just ticking a box with basic cover to avoid the MLS, consider your health needs and the various levels of available cover to avoid being underinsured.

And here’s another tip: if you are taking out hospital cover for MLS purposes, make sure your excess doesn’t exceed A$750 for singles or A$1500 for couples or families. This is the maximum permitted excess for private hospital insurance to avoid the MLS.

2. Take advantage of your age

A government initiative called the Lifetime Health Cover (LHC) loading was created to encourage Aussies to take out and maintain private hospital cover earlier. If you don’t take out private health insurance by 1 July following your 31st birthday, but you choose to take out a policy in the future, you’ll start to accrue the LHC loading on your hospital insurance premium.

The LHC loading accrues at 2% of your base hospital insurance premium for each year you’re over the age of 30 and don’t have hospital cover, and the maximum LHC loading is 70%.

For example, if you’re 40 and you’re taking out private health insurance for the first time, you’ll need to pay 20% more than someone who took out cover when they were 30, so it’s worth exploring your options before you’re impacted by the LHC loading.

3. Switch to meet your needs

If your current health insurance doesn’t meet your needs, switching before EOFY is to your advantage. Most extras for some funds, such as HCF, reset at the end of the calendar year; by switching to a cover with higher annual limits now, you will still have six months of the higher limits (however, it’s important to note that the benefits you’ve already claimed this year with another fund will be deducted from your annual limits).

Though it’s a busy period, it’s worth taking time to explore your private health insurance options to avoid paying extra or to switch to a cover that better suits your needs.

It’s time to assess your private health cover

HCF is the health insurance partner of the CA ANZ Member Benefits Program. To find out more, visit: corporate.hcf.com.au/charteredaccountants 

Disclaimer: This information is general in nature and does not take into account your objectives, financial situations or needs. You should consider whether it’s appropriate for you and read the relevant policy information before making a decision.