Editing Medicare (Australia) (section)

==Funding of the scheme==
[[File:Total health expenditure per capita, US Dollars PPP.png|thumb|right|350px|Total health spending per capita, in [[United States dollar|U.S. dollars]] [[Purchasing power parity|PPP-adjusted]], of Australia compared amongst various other first world nations since 1995]]

===Medicare levy===
Medicare is presently nominally funded by an income tax surcharge, known as the ''Medicare levy'', which is currently 2% of a resident taxpayer's taxable income.<ref>{{cite web |title=Medicare levy |url=https://www.ato.gov.au/Individuals/Medicare-levy/ |archive-url=https://web.archive.org/web/20130629085049/http://www.ato.gov.au/Individuals/Medicare-levy/ |archive-date=29 June 2013 |access-date=28 February 2015 |website=ato.gov.au}}</ref> However, revenue raised by the levy falls far short of funding the entirety of Medicare expenditure, and any shortfall is paid out of general government expenditure.

The [[2013 Australian federal budget|2013 budget]] increased the Medicare levy from 1.5% to 2% from 1 July 2014, ostensibly to fund the [[National Disability Insurance Scheme]].<ref>{{cite web |title=Medicare levy increase to fund DisabilityCare Australia |url=https://www.ato.gov.au/General/New-legislation/In-detail/Direct-taxes/Income-tax-for-individuals/Medicare-Levy-increase-to-fund-DisabilityCare/ |archive-url=https://web.archive.org/web/20150402123923/https://www.ato.gov.au/General/New-legislation/In-detail/Direct-taxes/Income-tax-for-individuals/Medicare-Levy-increase-to-fund-DisabilityCare/ |archive-date=2 April 2015 |access-date=28 February 2015 |website=ato.gov.au}}</ref> The [[2017 Australian federal budget|2017 budget]] proposed to increase the Medicare levy from 2% to 2.5%, from 1 July 2018, but this proposal was scrapped on 25 April 2018.<ref>{{cite web |last=Bagshaw |first=Eryk |date=25 April 2018 |title=Turnbull government to scrap $8 billion Medicare levy increase |url=https://www.theage.com.au/politics/federal/turnbull-government-to-scrap-8-billion-medicare-levy-increase-20180425-p4zbl1.html |website=The Age |access-date=26 April 2018 |archive-date=25 April 2018 |archive-url=https://web.archive.org/web/20180425163329/https://www.theage.com.au/politics/federal/turnbull-government-to-scrap-8-billion-medicare-levy-increase-20180425-p4zbl1.html |url-status=live }}</ref>

When the levy is payable, it is calculated on an individual's entire taxable income, and not just the amount above the low-income threshold.

====Private Health Insurance Levy and Lifetime Health Cover (LHC)====
{{Main|Health care in Australia#Health Insurance}}

In 1997, the [[Howard government]] implemented a higher level of Medicare levy for high income earners where they did not have a private health insurance policy. The purpose being to relieve strain on Medicare and the public health system by encouraging those that could afford it to receive care in the private system.

From the start of 1999, a 30 per cent rebate on the cost of private health insurance became available to further encourage people to take out private health insurance.

From 2000, the Lifetime Health Cover (LHC) initiative came into effect to encourage people to take out private health insurance with hospital coverage earlier in life. Individuals 31-year or older, and not exempted, are charged an additional 2% on any private hospital insurance policy they purchase for each year after their 30th birthday that they do not have coverage. They are required to pay this additional loading, up to a maximum of 70%, for 10 years, and the federal government rebate does not include the cost of LHC. After 10-years of continuous coverage, the loading is then removed.<ref>{{Cite book |last1=Duckett |first1=Stephen |url=https://grattan.edu.au/wp-content/uploads/2019/07/918-The-history-and-purposes-of-private-health-insurance.pdf |title=The history and purposes of private health insurance |last2=Nemet |first2=Kristina |publisher=Gratton Institute |year=2019 |access-date=27 July 2022 |archive-date=22 March 2022 |archive-url=https://web.archive.org/web/20220322093317/https://grattan.edu.au/wp-content/uploads/2019/07/918-The-history-and-purposes-of-private-health-insurance.pdf |url-status=live }}</ref><ref>{{Cite web |date=30 June 2023 |title=Lifetime health cover |url=https://www.ato.gov.au/individuals-and-families/medicare-and-private-health-insurance/private-health-insurance-rebate/lifetime-health-cover |access-date=8 June 2024 |website=[[Australian Taxation Office]] |archive-date=8 June 2024 |archive-url=https://web.archive.org/web/20240608071157/https://www.ato.gov.au/individuals-and-families/medicare-and-private-health-insurance/private-health-insurance-rebate/lifetime-health-cover |url-status=live }}</ref>

===Low income exemptions ===
Low income earners are exempt from the Medicare levy, with different exemption thresholds applying to singles, families, seniors and pensioners, with a phasing-in range. Since 2015–16, the exemptions have applied to taxable incomes below $21,335, or $33,738 for seniors and pensioners. The phasing-in range is for taxable incomes between $21,335 and $26,668, or $33,738 and $42,172 for seniors and pensioners.