Q: Up until last month I received a small Age Pension benefit. My Pension benefit was stopped.  When I contacted Centrelink, they advised that the value of my Allocated pension had risen and as a result I exceeded the Assets test limit and was no longer eligible for a benefit. I am a single homeowner. I have been told I can apply for the Commonwealth Seniors health Card (CSHC).  What is this and what is the difference between this and the added benefits I received under the Age pension?

A: The Commonwealth Seniors Health Card (CSHC) is a concession card that is available to individuals of Age Pension age who do not qualify for the Age Pension due to their level of income or assets.

The benefits of the CSHC include the following;

  • Discounted prescriptions for Medicines listed on the Pharmaceutical Benefits Scheme (PBS). Once the PBS Safety net has been reached, PBS prescriptions without charge for the remainder of the calendar year.
  • Payment of the Seniors Supplement which is currently $886.60 a year for a single person and $1,336.40 a year for a couple. There is a bill currently before parliament that will remove the seniors supplement for holders of the CSHC.

Card holders are due to receive their next quarterly payment on the 20th June 2015 and as a result of this legislation this will be their final seniors supplement payment.

It appears that the Government has secured the Green’s support for this legislation to be passed (although it hasn’t been passed as yet).

  • Payment of the energy supplement $366.60 a year for a single person and $511.20 a year for a couple.
  • Access to discount transport, household, education and recreation concessions that may be available from you State and Local Government.  Check in your state as entitlements do vary.

Unlike the Age Pension, the CSHC is not subject to the Asset test however it is subject to an income test threshold.  The threshold limit is income of $51,500 for a single person and $82,400 a year for a couple.

From 1 January 2015, new Account based pensions such as Allocated Pensions are deemed for income test purposes.  An Account based pension established prior to 1 January is grandfathered from deeming unless you lose your entitlement to receive the Age pension.

In your case, as a consequence of you losing the Age Pension, your existing Allocated Pension is therefore now deemed. As a single person, the first $48,000 of assets are deemed to earn 1.75% and assets in excess of this figure 3.25%.

Contact the Department of Human Services and request an application for the Commonwealth Seniors Health Card using your existing Customer Access Number.  Applications can be made online.

Follow Andrew on Twitter @AndrewHeavenFP. This article was originally published in The Australian