One of the great things about a federal election is that it flushes out all sorts of offers as the warring parties try to get the attention of voters.
Older Australians were a particular target as a voting block and the result was that both major parties ended up matching each other’s offers – the main one being a dramatic widening of the Commonwealth Seniors Health Card (CSHC).
The only problem now is getting the message out that this valuable card is available to a much greater number of people above the age pension age of 67 – many of whom would probably never even imagine that they would qualify.
Tough income test is now much higher
Most government benefits such as the age pension are strictly controlled by restrictions such as asset and income tests but under the current changes even many multi-millionaires can qualify for the CSHC now that we are past 1 July.
The previous restrictive income threshold above which access to the card was denied has been dramatically increased, adding eligibility to an expected extra 50,000 people – assuming they know about the change.
Under the old rules, singles and couples could not get a card if they earned more than $57,761 and $92,416, respectively.
The new limits are a lot more generous at $90,000 for singles and $144,000 for couples.
Bulk billing and cheap prescriptions on offer
There are a few more wrinkles that actually make it easier than it seems to qualify for the card, which entitles you to bulk billing at many medical clinics and means you can obtain many prescriptions listed on the Pharmaceutical Benefits Scheme from as little as $6.60 each.
There is no asset test on the CSHC, but under the rules a deemed income is attached to your superannuation which counts towards the income test.
At a time when interest rates are rising sharply, the deeming rate on super will be frozen for the next two years at just 0.25% for the first $53,600 in assets for a single and for the first $89,000 for a couple.
Once you get above those figures, income is deemed to be earning 2.25% a year.
Interestingly, the legislation to support the much more generous income limits has not yet been passed and the Services Australia website says: “We’re waiting for legislation to come into effect. We’ll update our website when you can claim under the new limits.’’
However, the lower limits are meant to have begun on 1 July.
Apply through Centrelink or online
The two main ways to apply for the card are by visiting Centrelink or to go online and fill out the forms.
Reporting income is split into two – estimated taxable income from work and investments with deemed returns from super filled out on another form.
Centrelink will then check your deemed income and eligibility for the card, with annuities and particularly lifetime annuities subject to further concessional treatment.
Indeed, lifetime annuities are not considered income at all for this test, while for other annuities only 60% is calculated for deeming.
Assets that don’t produce any income such as shares that don’t pay dividends or unoccupied property don’t have any deemed income so even some seriously rich people can qualify.
Apart from the direct medical service benefits, there are a range of other benefits that come with the card, depending on which state you live in, including energy and transport rebates and discounts on state government fees and charges.
Arguably the CSHC is now too easy for even quite wealthy retirees to access but that is not really the issue for those applying.
When political parties come bearing electoral bribes it would be churlish not to accept them.
After all, ask yourself the question, what would politicians do?