While higher income earners are preparing for changes to the federal government's 30 per cent private health insurance rebate, they are not the only ones who are affected – companies currently offering corporate health plans are also expected to take a hit.
By default, employers have had their company-sponsored health plans subsidised through the rebate, however a significant portion of the employees could no longer be eligible for the payment.
From July 1, singles earning more than $84,000 and couples year earning over $168,000 a year will have their rebate reduced by increments of 10 per cent.
Consequently, singles earning more than $130,000 and couples earning over $260,000 will see their benefits removed completely.
These higher income earners are often employed in industries such as finance, technology and mining – the very sectors that typically offer to pay for their workers' private health insurance.
Concerned employers may wish to speak to a specialised health insurance consultant to learn more about how they will be affected when the means testing commences.
Health Insurance Consultants Australia can work with you to develop a strategy to help minimise the increase in costs, as well as the associated increase in the Fringe Benefits Tax liability.