The bill introduced by Australian Health Minister Tanya Pilbersek in Parliament that seeks to put in place a means testing for health insurance rebates is expected to receive parliamentary approval by the third week of February. The aim of the bill is to add $2.4 billion to government coffers.

Once approved, about 2.4 million wealthy Australians would pay up to $1,000 a year more from health cover beginning July.

Under the bill, individuals who earn more than $83,000 a year and couples earning more than $160,000 would have their rebates cut by up to 20 per cent. The rebates were introduced by the Howard government to reduce the cost of health insurance by 30 per cent regardless of the income level of the insured.

For 2012-13, the change would raise $746.3 million which would help the Gillard government fulfill its promise to return to a $1.5-billion budget surplus.

The measure, which was rejected by parliament when it was first proposed three years ago and was twice thumbed down, is expected to receive support even outside Labor Party. Greens MP Adam Bandt is supporting the measure, Tasmania independent MP Andrew Wilkie has said he is included to support it and regional crossbencher Rob Oakeshott is believed to be supportive of the bill.

Opposition leader Tony Abbott has promised to fight the proposal, but did not commit to reversing the measures if he becomes prime minister.

A study by Treasury said the amendment would cause 0.3 per cent of private health insurance holders or only 27,000 people to drop out altogether and rely solely on the public health system. All of the dropouts would be singles who earn between $83,000 and $96,000 per annum and couples who earn between $166,000 and $192,000.

Those two groups, who are on the first tier of people eligible for the means test, have income low enough and would not be hit by a Medicare levy surcharge if they drop out of private health insurance, but high enough to be affected by the means test.

However, a separate Deloitte report estimated the number of dropouts would reach 175,000 from different tiers on the first year alone. Over four years, a total of 1.6 million Aussies will drop their private hospital cover due to overall rise in premiums and they will shift to the public hospital system, the Deloitte report said.

The government, however, questioned Deloitte's report. It cited historical data that price hikes do not cause people to drop out of private health insurance.

"it's important to remember that most people will not lose the subsidy entirely, as their incomes increase, the subsidy will decreased," Ms Pilbersek clarified.

Victorian Health Minister David Davis and various health funds opposed the means test.

"Half the nation has private health insurance and if you drive people out of private health insurance on to the public system that's already overstretched, we'll just get bad health outcomes," opposition health spokesman Peter Dutton warned.