We are aware that for a person to be eligible for the age pension, their assets and income need to be below the relevant thresholds and of course they need to reach the required age.

I often talk to people who enquire about their entitlement to the age pension, who lose interest in any other government entitlement once they realise their assets or income are above the required thresholds and are not entitled to even a part age pension.

For these people there is another Government benefit they could explore – the Commonwealth Seniors Health Card.

So, what are the benefits of this card? 

With the card you may get;

• Cheaper medicines under the pharmaceutical benefits scheme
• Bulk billed doctors’ visits - this of course depends on whether the doctor chooses to bulk bill
• A larger refund for medical costs when you reach the Medicare safety net

In addition to these benefits you may also receive concessions on the following* -

• Electricity and gas bills
• Property and water rates
• Health care costs – e.g. ambulance dental and eye care
• Public transport

*These concessions may depend on where you live as they are offered at the discretion of state and local government.

Eligibility for this card is not subject to any assets test but is subject to an income test.

The income considered is a combination of your adjusted taxable income which of course includes your taxable income plus any net investment losses which may have in fact reduced your taxable income.

In addition to this income, if you are in receipt of a tax-free pension from your account-based pension, then the account balance of the pension is deemed at a combination of 1% and 3%.

To receive this card a person’s combined yearly income as outlined previously needs to be less than-

• Single $54,929 pa
• Couple $87,884 pa

In addition to this card, a person who is not entitled to the age pension because of their assets, but are eligible for the Commonwealth Seniors Health Card they could go one step further and test their eligibility for the Low Income Health Card.

Why would I bother you may ask? 

As I have previously mentioned the Commonwealth Seniors Heath Card provides benefits from a pharmaceutical and medical perspective, (which the Low Income Health Card also provides). In addition, the Low Income Health Card also provides some state and local government concessions on electricity, gas, rates, public transport, motor vehicle registrations etc. which are only available for those who hold a Low Income Health card.

So yes, for some retirees depending on where you live this extra card can provides some substantial economic benefits.

The Low Income Health Card like the Commonwealth Seniors Health Card is not subject to an assets test but is subject to an income test which is slightly different to the Commonwealth Seniors Health Card test.

For a single person your income needs to be less than $561 per week or $4,488 in the 8-week period before you apply.

For a couple your income needs to be less than $969 per week or $7,752 in the 8-week period before you apply.

The income considered covers deemed income on investments, deemed income on account-based pension balances, rental income etc.

Naturally like any government benefit, eligibility is not quite as simple as I have explained; however, if you are interested and  think you may have entitlement to either card, do not hesitate to enquire or ask your financial adviser if you do have one.