A survey of more than 2000 Australians shows only 14 per cent knew the loading goes straight to the health funds'bottom line. The rest thought it went to the Australian Taxation Office,was split between the insurers and the Tax Office,or had no idea.
"If we look at the average policy,which is around $4000 a year,that person with LHC applied would be paying nearly $4800 if they took out a policy for the first time at 41,"said Finder's Bessie Hassan.
The Howard government introduced LHC – alongside the Medicare levy surcharge and then 30 per cent rebate – to pump the system with young and healthy people and lower premiums for everyone.
The industry's peak body Private Healthcare Australia (PHA) says the impact has diminished and is seeking the government's permission to introduce a"reverse"LHC – a lifetime health cover discount to those who buy hospital cover between 18 and 30 years.