Missing this before 31 could cost someone you know thousands

Turning 31 may not feel like a big milestone — but if you know someone approaching that age, it could be the perfect time to help them avoid paying extra for private hospital cover later in life.  

It’s all because of something called Lifetime Health Cover (LHC) loading — a government penalty that can make private hospital cover more expensive if you wait too long to get it. 

If you purchase hospital cover earlier in life, and keep it, you won’t pay an extra amount called LHC Loading. 

It’s aimed to achieve a more balanced distribution of costs within Australia's healthcare system by encouraging younger, healthier people to contribute to the private insurance pool. 

So, what's turning 31 have to do with this? 

It matters because  you may have to pay LHC loading if you have not taken out eligible private hospital cover by 1 July following your 31st birthday and delay getting it until later in life.. 

Example

Jane turned 31 in January 2022, so her Lifetime Health Cover (LHC) base day was 1 July 2022. She did not hold any hospital cover before or on that date. 

She decided to take out hospital cover for the first time in October 2023, more than a year after her base day. 

Because she did not hold hospital cover on or before her base day, and she was over 30 when she first took out cover, she is required to pay LHC loading on top of her hospital premium. 

The loading is calculated at 2% for each year she was aged over 30 and did not have hospital cover.  

She will pay this extra 4% loading for 10 continuous years, unless she qualifies for an exemption. 

If her base hospital premium is $1,500 per year, the loading would add $60 per year, bringing her total to $1,560 annually for those 10 years. 

How much do you pay?

You pay an extra 2% on your private hospital cover premium for every year you don’t have hospital cover after the age of 30. This is called the LHC loading. 

For example, if you wait until you’re 40 to take out cover, you could pay 20% more. If you wait until you’re 50, that loading could be 40%. 

The good news? After 10 continuous years of holding hospital cover, the loading is removed.  

But if they cancel their policy and later rejoin, they might have to pay the loading again. 

What to do next

If you know someone who’s about to turn 31, now’s the time to let them know about LHC loading.  

A quick conversation could help them avoid paying more for private hospital cover in the future. 

Encourage them to look into their options and take out eligible hospital cover before 1 July following their 31st birthday. 

Want to learn more? Visit our Lifetime Health Cover page to find out how it works and how to avoid the loading. 

They can also check privatehealth.gov.au's Lifetime Health Cover calculator.