Commonwealth Seniors Health Card: $60k worth of retirement perks

The Commonwealth Seniors Health Card (CSHC) has been making headlines lately. Not because it's anything new - the card has been around for over 30 years.

Rather, it's estimated that around one million Australians could be missing out on the savings the card provides - perks that can add up to $60,000 over the course of your retirement. 

What is the Commonwealth Seniors Health Card?

Put simply, the CSHC is a concession card.  

It's designed to provide cheaper health care for seniors through discounted medicines, and larger refunds when you reach the Medicare Safety Net.

Other savings that may be available include energy rebates leading to lower electricity and gas bills, discounts on rates and savings on public transport fares.  

These non-health savings can vary widely from state to state. Even so, it's estimated that the CSHC can deliver savings worth $2,000 to $3,000 each year.

This can really add up. The card is only available from pension age which is currently 67 or older. On this basis, if we assume a cardholder lives to age 87, over a 20-year timeframe (from age 67), the $3,000 annual perks of the CSHC can add up to $60,000. Even more if you live longer. 

Who is eligible for a Commonwealth Seniors Health Card? 

Three rules decide who can get the CSHC. As I've noted, you need to be of pension age, however, unlike a lot of government concessions, you don't need to be an age pension recipient.  

In fact, the CSHC is only available if you don't receive an age pension or other income support through the Department of Veterans' Affairs.

If you tick these first two boxes (your age and self-funded retiree status), you'll still only be eligible for the CSHC if you earn below a set annual income.  

Income test

This is where things get interesting. The income threshold for the CSHC has been raised in recent years, and will be reviewed again in September. 

Right now, you can apply for a card if you earn less than:

• $99,025 a year if you're single 
• $158,440 a year for couples, and  
• $198,050 a year for a couple separated by illness, respite care or prison. 

Add $639.60 to these amounts for each child in your care. 

These income thresholds can be more generous than it first appears.  

Income sourced from lifetime annuities, for example, isn't always counted in this definition of income. 

No assets test 

Income aside, the big plus of the CSHC is that eligibility doesn't hinge on your assets. This is great news for self-funded retirees. 

So it's surprising that with a possible $60,000 up for grabs (albeit over several decades), a significant proportion of the nation's self-funded retirees don't have a CSHC.

Why aren't more retirees tapping into the CSHC? 

One reason is that Australians often don't know the full range of benefits they may be entitled to in retirement.  

This can especially apply to self-funded retirees who may easily assume they aren't eligible for any government support.  

This isn't always the case, and if in doubt, speak to your financial adviser or contact Centrelink's Financial Information Service on 132 300.

A major stumbling block that can deter retirees from applying for the CSHC is the process of applying through Centrelink.  

Yes, it can be onerous.  

Yes, there is paperwork to complete.  

No, the government doesn't give away perks easily.  

But don't let this turn you off.  

Keep those possible $60,000 savings from the CSHC in mind, and your persistence may be rewarded!