Private Health loss of Rebate for some

[rechoboam]

Well apart from the small problems of him
- not being mad
- not being a monk
I'm sure you are right.
Actually (and I'm not overly impressed by the Liberals or their policies) he seems to be to be a perfectly sane, highly intelligent, determined person who does happen to be Catholic. I'm not surprised that his opposition feels a need to slime him as, if he were my opponent, I would be rattled too.

 

[MatF]

It will be an interesting Monday.
I'm not sure what the point of a Labor leadership stouch is now, to be honest. It's like appointing a new captain of the titanic after it's hit the iceberg.

 

[simongr]

Sorry - can't help myself - hope this is useful - its not on your taxable income. It is actually your "income for surcharge purposes". Which is Taxable income (including net amount on which family trust distribution tax has been paid), exempt foreign employment income (if your taxable income is $1 or more), reportable fringe benefits, total NET investment losses and reportable super contributions. There is removal of income if you are 55/59 with a super lump sum.

I am glad that not only have they not simplified the rebate system they have made the basis of it nice and complex.

Imagine the customer going into a Medibank private shop:

Customer: Hi I would like to buy some health insurance please - how much will that be?
MBP Employee: Interesting you should ask - how much rebate do you want to claim?
Customer: ?
MBP: Well you claim a range of rebates now or claim none and let the government work it out in 12 months.
C: A range?
M: Well it is based on your income for surcharge purposes
C: ?
M: You know the amount of Taxable income (including net amount on which family trust distribution tax has been paid), exempt foreign employment income (if your taxable income is $1 or more), reportable fringe benefits, total NET investment losses and reportable super contributions.
M: Oh and there is removal of income if you are 55/59 with a super lump sum
M: Dont forget that if you guess how much all of that is is in the 12 months and the government thinks you guess wrong on purpose they might fine you.

Yeah that will be a simple conversation for retail trained people to communicate before they even start on how much cover you get for certain procedures in certain hospitals which is pretty much determined by which suburb you live in...

Ah well at least the govt will b investing in great new services - or just plugging a whole in the deficit- I can never remember which it is.

 

[Deleted member]

It will be an interesting Monday.
I'm not sure what the point of a Labor leadership stouch is now, to be honest. It's like appointing a new captain of the titanic after it's hit the iceberg.

LMAO. Excellent

 

[tuapekastar]

In relation to this thread, if anyone needs a perfect explanation of how to fill their tax return in then refer here. It is US-oriented but equally applicable here.

It is not necessarily all that far-fetched... :shock:

 

[rechoboam]

I am glad that not only have they not simplified the rebate system they have made the basis of it nice and complex.

Imagine the customer going into a Medibank private shop:

Customer: Hi I would like to buy some health insurance please - how much will that be?
MBP Employee: Interesting you should ask - how much rebate do you want to claim?
Customer: ?
MBP: Well you claim a range of rebates now or claim none and let the government work it out in 12 months.
C: A range?
M: Well it is based on your income for surcharge purposes
C: ?
M: You know the amount of Taxable income (including net amount on which family trust distribution tax has been paid), exempt foreign employment income (if your taxable income is $1 or more), reportable fringe benefits, total NET investment losses and reportable super contributions.
M: Oh and there is removal of income if you are 55/59 with a super lump sum
M: Dont forget that if you guess how much all of that is is in the 12 months and the government thinks you guess wrong on purpose they might fine you.

Yeah that will be a simple conversation for retail trained people to communicate before they even start on how much cover you get for certain procedures in certain hospitals which is pretty much determined by which suburb you live in...

Ah well at least the govt will b investing in great new services - or just plugging a whole in the deficit- I can never remember which it is.

Fantastic. And in five years the customer will go to have a tooth removed and will spend a whole morning running around submitting paperwork and paying in cheques and posting other cheques to the doctor or dentist, so they can claim their insured portion (which will be about as much as a Blu-ray disc costs)....

 

[drron]

Great points simongr.Just how are they going to administer the rebate.If you pay your PHI upfront and get the rebate credited with your tax return that is going to cause a few people a cash flow problem.if you have to estimate up front and get your income wrong will their be penalties?Working part time as a locum with jobs usually arranged just a few weeks ahead I have no idea what my income will be for the next financial year.

 

[medhead]

Well apart from the small problems of him
- not being mad

Not mad? And you mentioned the liberal policies? Besides didn't arm-breaker say he was as mad as a cut snake.

- not being a monk

He trained for the priest hood so technically he is a qualified monk.

Sorry - can't help myself - hope this is useful - its not on your taxable income. It is actually your "income for surcharge purposes". Which is Taxable income (including net amount on which family trust distribution tax has been paid), exempt foreign employment income (if your taxable income is $1 or more), reportable fringe benefits, total NET investment losses and reportable super contributions. There is removal of income if you are 55/59 with a super lump sum.

I can't find the details, but I clearly remember a talking head, or the newspaper write up saying that these things would not be added back. The words were something like it won't be like family tax benefit, which does add in those items as you say. Would appreciate any link you can provide to official information about how it works.

Great points simongr.Just how are they going to administer the rebate.If you pay your PHI upfront and get the rebate credited with your tax return that is going to cause a few people a cash flow problem.if you have to estimate up front and get your income wrong will their be penalties?Working part time as a locum with jobs usually arranged just a few weeks ahead I have no idea what my income will be for the next financial year.

It's not that hard, no doubt they'll do it exactly the same as they currently do family tax benefit, which is reconciled at the end of the year if one claims it up front instead of at the end of the year. There are no penalties involved you just get a bill and/or the extra that is still owed. NB a system designed by the Liberals so it must be entirely beyond reproach.

 

[drron]

It's not that hard, no doubt they'll do it exactly the same as they currently do family tax benefit, which is reconciled at the end of the year if one claims it up front instead of at the end of the year. There are no penalties involved you just get a bill and/or the extra that is still owed. NB a system designed by the Liberals so it must be entirely beyond reproach.

Well first they have not announced this yet.
Second they are desperate for money to get budget back to surplus.(will still be sleight of hand as the NBN and a few other programs are off the balance sheet).
Third I am not a Liberal party member-though have been a member of both the ALP and Liberals.
Fourth not all ALP policies are good just as all Coalition policies are not bad.

 

[medhead]

Well first they have not announced this yet.

Just pointing out that they already have a system for doing this sort of thing (warts and all) and there is no reason to think PHI rebate will be any different.

Fourth not all ALP policies are good just as all Coalition policies are not bad.

bit of a Freudian slip there? How did I know you'd hold that view


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[dfcatch]

Just pointing out that they already have a system for doing this sort of thing (warts and all) and there is no reason to think PHI rebate will be any different.



bit of a Freudian slip there? How did I know you'd hold that view


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I didn't think you would miss that one Medhead

Ahh the trials of the word "not" being in the wrong place.

 

[burmans]

You know I wouldn't even mind if our schools, roads, public hospitals and other infrastructure were up to scratch, but it really annoys me to pay so much tax and get seemingly little for it. As others have said, if we stay in PHI, I effectively see this as an additional tax burden - which is why we may well not.

I think the trouble with this argument is that it is the fact that we have relatively "big" government in Australia is part of the reason for this, and the provision of middle class welfare is undoubtedly a part of this. Am pretty sure most economist would agree that government is not a very effective manager of money, i.e. for each $ you pay in tax you probably only get 90c of benefit (if that), the countering argument is that government services are however fair. Situations like here where things are not perceived as fair OR effective are undoubtedly exacerbated by middle class welfare, cut this back to those who really need it and you would be happier with the effectiveness of the tax system (i.e. you'll pay less tax but recognise that in doing so you get less services).

But are we ready to be weaned off our high-welfare society?

 

[11sjw]

I think the trouble with this argument is that it is the fact that we have relatively "big" government in Australia is part of the reason for this, and the provision of middle class welfare is undoubtedly a part of this. Am pretty sure most economist would agree that government is not a very effective manager of money, i.e. for each $ you pay in tax you probably only get 90c of benefit (if that), the countering argument is that government services are however fair. Situations like here where things are not perceived as fair OR effective are undoubtedly exacerbated by middle class welfare, cut this back to those who really need it and you would be happier with the effectiveness of the tax system (i.e. you'll pay less tax but recognise that in doing so you get less services).

But are we ready to be weaned off our high-welfare society?

But again this rebate was , supposedly, introduced to move people away from the Public Health System as it wasn't/isn't coping. It's not like middle Australia stood up and said "Make my Private Health cover cheaper."

 

[simongr]

Just pointing out that they already have a system for doing this sort of thing (warts and all) and there is no reason to think PHI rebate will be any different.

For a start the the PHI rebate is administered by the insurers unlike the FTB, second the insurers have aready been told that they will be able to give the option to elect different rebate percentages based on the member's estimation of what rebate they think thy are entitled to. So in all likelihood it wont be administered in the same way as FTB.

 

[MatF]

i.e. for each $ you pay in tax you probably only get 90c of benefit (if that), the countering argument is that government services are however fair.

I think the perception of fair or unfair is fairly simple, and comes from the fact that higher income earners don't get any more back as "value" from the proportionally higher tax dollars they contribute to the govenment - indeed it's quite likely to be less if they also pay for PHI, send their kids to private schools, etc, etc. We all drive on the same roads, have the same defence force, use the same government infrastructure otherwise, etc. Overlay the fact that high income earners not only pay more tax dollars because they earn more, but proportionally higher tax as well, and the value-back-per-tax-dollar starts looking fairly sick (particularly if you also happen to receive no direct government assistance). It's not hard to see how this can be perceived as unfair, IMHO. The current tax system provides no incentive to study hard/work hard/work your way into highly valued professions.

Situations like here where things are not perceived as fair OR effective are undoubtedly exacerbated by middle class welfare, cut this back to those who really need it and you would be happier with the effectiveness of the tax system (i.e. you'll pay less tax but recognise that in doing so you get less services).

Or, cut it back and watch the government waste more of your tax dollars. This reduction in middle class welfare isn't associated with any tax cut.

 

[medhead]

For a start the the PHI rebate is administered by the insurers unlike the FTB, second the insurers have aready been told that they will be able to give the option to elect different rebate percentages based on the member's estimation of what rebate they think thy are entitled to. So in all likelihood it wont be administered in the same way as FTB.

Don't get confused about what is happening here. Yea you can choose to let the insurance company collect the rebate directly from government ie administer it. But you can also choose to pay the full insurance premium. Either way the ATO reconciles your entitlement when you do you tax return. So in exactly the same way as family tax benefit, it will be a simple matter to either resolve the amount of rebate as part of the end of year reconciliation.

For extra clarity note the word reconciliation not administration 2 related but ultimately different things. FTB already has a system for resolving under or over payments without penalty for getting it wrong. There is no reason to think the health insurance rebate will be any different.


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[medhead]

But again this rebate was , supposedly, introduced to move people away from the Public Health System as it wasn't/isn't coping. It's not like middle Australia stood up and said "Make my Private Health cover cheaper."

In combination with the Medicare surcharge, which will still encourage people to earning > the relevant amounts to have private health.


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[simongr]

Don't get confused about what is happening here. Yea you can choose to let the insurance company collect the rebate directly from government ie administer it. But you can also choose to pay the full insurance premium. Either way the ATO reconciles your entitlement when you do you tax return. So in exactly the same way as family tax benefit, it will be a simple matter to either resolve the amount of rebate as part of the end of year reconciliation.
For extra clarity note the word reconciliation not administration 2 related but ultimately different things. FTB already has a system for resolving under or over payments without penalty for getting it wrong. There is no reason to think the health insurance rebate will be any different.

The difference is that people have always chosen the health fund as the administrator (by always I mean 90% of the time) and the added complication is that you will (might) be able to chose a range of rebate % - which will require major changes to IT systems in the health funds which the govt wont be funding.

 

[medhead]

The difference is that people have always chosen the health fund as the administrator (by always I mean 90% of the time) and the added complication is that you will (might) be able to chose a range of rebate % - which will require major changes to IT systems in the health funds which the govt wont be funding.

I'm sorry I read both your post and drron's reply to be focused on the difficulty of estimating your rebate level and possible penalties if that is wrong. The whole thing about insurance company IT systems didn't come against at all, and certainly not as the only issue you where raising. My mistake.


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[simongr]

I wasn't saying it was the only issue at all. There is going to be complexity throughout this process in an already complex arena. It is going to make it much harder for people to compare funds as well.