How much is the Medicare levy surcharge?

The Medicare levy surcharge is an additional tax of between 1% and 1.5%, depending on how much you earn. It kicks in once you start earning $101k ($202k as a couple or family) and you don't have hospital insurance. The full 1.5% is only applied to singles who earn more than $158k a year, or couples/families earning more than $316k a year. Note this is in addition to the 2% Medicare Levy that most tax payers pay.

How can I avoid the Medicare levy surcharge?

You can avoid the Medicare levy surcharge by taking out an eligible hospital cover policy. Your cover will need to have an excess of no more than $750 for singles, or $1500 for couples.

Do my partner and I both need hospital cover to avoid the MLS?

Yes, if you both earn a combined income (for MLS purposes) of more than $202,000 in the current financial year, you must both hold hospital cover to avoid the MLS. If any part of your family isn't covered, you'll pay at least part of the surcharge (it will be pro rata'd).

Do both spouses pay the Medicare Levy Surcharge?

Essentially, yes. If you have a spouse, the ATO uses your combined income to calculate your surcharge.

If I switch my hospital cover, will I need to re-serve my waiting periods?

No. The industry follows portability rules to make sure there's competition among health funds. You won't need to re-serve any waiting periods you've already served.