DS1 turns 21 next month, and since he graduated last year he will no longer be covered by my private hospital insurance plan (that my employer subsidizes). As he will have only been working for 6 months out of this financial year, he won't have to worry about the Medicare Levy Surcharge this FY, but next FY his income will probably put him in Tier 2 (or possibly Tier 3), meaning that unless he has private hospital insurance he will have to pay 1.25% (or 1.5% for Tier 3) MLS on his taxable income. For a taxable income of $120,000 that would mean an MLS impost of $1,500 if he doesn't have basic private hospital cover.
Since a 21 year old can obtain basic private hospital cover for around $104.63 per month ($1,255 pa), it is actually cheaper to have basic private hospital cover (including a basic dental option) than to pay the MLS, especially since he will probably also save a few hundred dollars each year from claiming on basic dental check-ups.
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