There are a range of costs associated with aged care. How much you will pay will depend on a number of factors, including the level and type of care needed, whether you require in-home care or residential care, your financial situation and which provider you wish to go with, as well as the provider’s geographical location.
For some people, only basic in-home care is required, and this is provided via the Commonwealth Home Support Programme. A person receiving this type of care is expected to contribute to the fee where possible, but it will be subsidised. Any subsidy received from the government for the Commonwealth support programme does not impact your pension, as the subsidy is paid directly to the provider.
For others, more complex in-home care is needed – this is provided with a Home Care Package. This type of care consists of a basic daily fee (currently up to $10.63) and for some people, an income-tested care fee (currently up to $30.49). Whether or not you pay the income-tested care fee will be determined using a formal income assessment. There may be fees for any extra services as well that aren’t covered by a home care package.
When looking for residential care, the aim is to find accommodation that suits your needs, budget and preferences. The total cost associated with residential care is made up of a number of fees:
- Basic Daily fee, a maximum amount that covers the day-to-day cost of residential care services such as meals, laundry, cleaning and facility management. Currently $51.63 per day.
- Means-tested care fee, contributing to the cost of your personal and clinical care. This is an additional fee that some people will pay, determined via income and assets assessment. Currently up to $252.20 per day.
- Accommodation costs, either a full payment, regular payment or a combination of the two to cover the cost of your accommodation, depending on income and assets. This is set in negotiation with the residential care provider. Providers must publish their maximum accommodation costs on their website.
There may also be additional fees for any extras, such as a newspaper delivery, or fees for any other services beyond the minimum care and service requirements that you may make use of.
Accommodation costs are widely variable, depending on the location, provider and type of room; e.g., single, or shared rooms, with private or shared bathrooms. Accommodation fees are quoted by aged care service providers in two ways:
- RAD (Refundable Accommodation Deposit, refundable)
- DAP (Daily Accommodation Payment, non-refundable).
The fees can be paid in either way, or as a combination of both. The DAP is the daily equivalent of the RAD but multiplied by a maximum permissible interest rate. In cases where you are unable to afford the full fees, the government may cover some or all of the fees for you.
The Australian government sets a cap for daily fees and accommodation costs, and also caps means-tested fees. One these maximum amounts are reached, the care provider cannot ask for more fees.