The Commonwealth Seniors Health Card (CSHC) provides eligible self- funded retirees and workers over pension age with concessions on prescription medicines and a range of other benefits, such as:
• Bulk-billed doctor appointments (at the doctor’s discretion).
• Lower PBS Safety Net threshold.
• Concessions on health, transport and education costs provided by state governments.
• Retail discounts and concessional rail travel on some services.
In order to ensure that people with similar incomes are treated consistently, account based pensions are included in the CSHC income test in the same way as non-superannuation financial investments. The income is calculated using Centrelink’s deeming rates, not the actual payments received from the account based pension.
Who is eligible?
The CSHC is available to those who have reached Age Pension age but do not qualify for a payment from Centrelink or the Department of Veterans’ Affairs.
Singles are eligible for a CSHC if their annual income is less than $53,799. For couples combined, the limit is $86,076. Account based pensions are included in the calculation of this income.
For a single person relying entirely on financial investments for their income, the first $51,200 of their investments is deemed to earn 1.75% per annum, and any amount above this, 3.25% pa.
For a couple, and assuming investments are split reasonably evenly, the first $85,000 is deemed to earn 1.75% pa and the remainder 3.25% pa.
Watch out Current holders of a CSHC who go overseas for more than 19 consecutive weeks will lose the card. On their return they will have to apply for a new one.
Another aspect to be cautious of is that deeming rates can change. Although these have recently reduced, if rates increase so will the amount of deemed income and card holders who are close to the income thresholds may lose their cards.
While it is possible to construct financial strategies that can help people qualify for a CSHC, these may be detrimental to their long-term financial position. It is therefore important to talk to us, so we can examine your overall situation, and advise on the best course of action.
Department of Human Services website www.humanservices.gov.au “Commonwealth Seniors Health Card”
Department of Human Services website www.humanservices.gov.au “Deeming”
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