Avoid the $1,010 tax trap: 5 hospital covers for high-earners
Key takeaways
- If you’re earning more than $101,000 and don’t have hospital cover, you could be hit with an additional tax of up to 1.5% on your taxable income. This is called the Medicare Levy Surcharge (MLS).
- Taking out cheap, basic hospital cover helps you avoid the MLS and provides private hospital access.
- What’s next: Take a look at some of the most affordable options below and purchase basic hospital cover today.
If your taxable income has recently hit $101,000, it may be time to consider private health insurance.
Unless you have hospital cover, you’ll be hit with the Medicare Levy Surcharge (MLS), a penalty tax of up to 1.5% added to your annual tax bill.
For many Australians, picking up a basic hospital policy. is actually cheaper than paying the tax.
With the end of the financial year fast approaching, taking out one of these budget-friendly policies today could save you hundreds.
HBF Basic Hospital Accident Only $750/$1500 Excess
This is a straightforward, budget-friendly choice from a trusted non-profit insurer. It meets the ATO’s requirements for the Medicare Levy Surcharge while providing peace of mind with emergency ambulance and coverage for accidental injuries. Plus, new customers can get 6 weeks free on hospital cover after their first month. Offer ends 30 Jun 2026. T&Cs apply.
Get quotesee-u Starter Hospital $750 Excess with Daily Co-Pay (Basic)
see-u offers a "no-frills" policy that focuses on keeping premiums as low as possible. By including a small daily co-payment for hospital stays, see-u is able to drop the monthly cost significantly, making it a great option for high earners who simply want to avoid the tax hit.
Get quoteFrank Health Insurance Frank Basic Accident Boost Hospital
Frank is known for its simple, online-first approach and competitive pricing. The "Accident Boost" feature is a standout, as it upgrades your level of cover if you are admitted to hospital for an accident, giving you much higher protection than a standard policy while still keeping the price point low enough to beat the surcharge.
Get quoteahm ambulance & accident hospital (basic)
ahm is often the go-to for younger Aussies looking for an affordable entry point into private health. This policy strips away the fluff to focus purely on meeting the MLS exemption criteria, but still includes unlimited emergency ambulance cover and their "Accident Override" feature for unexpected emergencies.
Get quoteMedibank Basic Accident and Ambulance
This policy provides the essential coverage to avoid the MLS without paying for services you don’t plan to use. It offers a "Gold" level of hospital benefits in the event of an accident, meaning you get premium-tier treatment for emergencies while paying a fraction of the cost of a comprehensive plan. New members can also unlock 6 weeks of free cover. T&Cs apply.
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