There is 1.5% medicare levy, and if you don't have health insurance, you get hit with another 1% if you earn.. I think it's $70,000+ for a single. Not sure what it is for a family.

So that person earning $70,000 would be slugged an extra $700 tax in surcharge, which could just as easily have gone towards health insurance, and at least you can claim benefits with health insurance.

Will just go look up the thresholds

here's some info: http://www.privatehealth.gov.au/info...dicarelevy.htm

I recall when they upped the thresholds that a lot of people dropped out of their private health.. but you need to remember if you're over 30 that when you rejoin the premium will be higher the older you are.

ETA: just re-read your question. Yes, you'll always pay the 1.5% medicare levy, unless you are exempt. It's the surcharge you can avoid if you get hospital cover.