Aged care costs if you entered care before 1 July 2014
On 1 July 2014, the way fees are worked out for Home Care Packages and aged care homes changed. These changes are part of reforms so the aged care system is more sustainable and affordable.
If you moved into an aged care home before 1 July 2014, the fee arrangements that started on 1 July 2014 do not apply to you. You will keep paying the fees that you already pay under the old fee arrangement, including:
- care fees (basic daily fee, and an income-tested fee if your assessed income is above a certain amount)
- accommodation costs (either an asset-tested accommodation charge or an accommodation bond)
- extra service fee
- additional service fee.
The type of accommodation costs you pay depends on:
- your assessed level of care when you moved into the aged care home
- the amount of your assessed assets.
A full list of current rates is provided on the Schedule of Fees and Charges for residents in care before 1 July 2014.
If you cannot pay your aged care costs, you can ask for financial hardship assistance through Services Australia.
If you decide to move to a new aged care home, you have the option of being assessed under the post-1 July 2014 fee arrangements, or staying with your existing arrangements. The new fee arrangements will automatically apply if you leave your aged care home for more than 28 days and re-enter an aged care home.
Read more about current aged care home costs (post 1 July 2014).
Caps on fees
The amount of income-tested fees you can be asked to pay under the pre-1 July 2014 fee arrangements are capped at a daily rate.
Annual and lifetime caps only apply to residents in the post-1 July 2014 fee arrangements.
If you received a Home Care Package before 1 July 2014, the fee arrangements that started on 1 July 2014 do not apply to you. You will keep paying the fees that you already pay under the old fee arrangement.
Until 30 June 2019, the basic daily fee for a Home Care Package is 17.5% of the single person rate of the basic age pension for all package levels.
From 20 March 2019, the single rate of the basic age pension is $843.60 per fortnight, making the basic daily fee (from 20 March 2019 to 19 September 2019):
- $10.54 per day, or
- $147.56 per fortnight
This amount applies even if you are a member of a couple.
From 1 July 2019, the maximum basic daily fees for home care will reduce by:
- $400 for Level 1
- $200 for Level 2
- $100 for Level 3
To maintain the value of your Home Care Package, the government will increase the value of its contribution for each package level by the same amount.
From 1 July 2019, the basic daily fee, by Home Care Package level:
Per cent of the single
|Daily fee||Fortnightly fee|
Income-tested care fee
If you have a total assessable income above the maximum income of a full pensioner, your service provider can ask you to pay an income tested fee. This fee can be up to 50% of your income above the age pension amount.
It is the provider’s responsibility to calculate the income tested fee. There is also no reduction to subsidy or primary supplements when a person pays an income tested fee.
In setting these fees, providers need to consider if they would cause the consumer financial hardship and reduce the level of fees as necessary.
Your maximum fees depend on your income but your home care provider must also have regard to unavoidable expenses such as high pharmaceutical bills, rent, utilities and other living expenses. This means that you can negotiate a lower basic daily fee and/or income tested fee directly with your home care provider, if you are experiencing financial hardship.
You will not be affected by the changed fee arrangements if you move between package levels. However, the changed financial arrangements will apply if you:
- leave your home care service provider for more than 28 days (not including leave) and then re-enter home care
- change the type of care you receive, such as leaving a Home Care Package and moving into an aged care home.
- transfer to a new home care service within 28 days and opt into the post-1 July 2014 fee arrangements.
Read more about current Home Care Packages costs (post 1 July 2014).
Annual and lifetime caps
If you received a Home Care Package before 1 July 2014, or you have transferred to a new home care service provider but have decided to stay on your existing fee arrangements, the annual and lifetime caps do not apply to your income-tested fees. The caps only apply to income-tested care fees that are payable for people that entered care after 1 July 2014 or opted in to the post-1 July 2014 fee arrangements upon moving home care service providers.
Opting into the post-1 July 2014 fee arrangements
If you were receiving a Home Care Package or had entered an aged care home on or before 30 June 2014 and you move to a new home care service or aged care home (and do not spend more than 28 days outside of care, other than on approved leave), you can opt into the fee arrangements that started on 1 July 2014.
To make this choice, you need to complete the Continuing Care Recipient opting into the New Aged Care Arrangements from 1 July 2014 (AC022) form and have your provider submit it to Services Australia before you transfer.
Your provider will also need to give you to read:
- New Arrangements for Aged Care from 1 July 2014 – Home Care, or
- New Arrangements for Aged Care from 1 July 2014 – Residential Care
If you do not complete and submit this form before you transfer, you will automatically be classed as a ‘continuing care recipient’ and will remain on your pre-1 July 2014 fee arrangements. This is not a reviewable decision and must be done correctly in order for you to opt in. You should discuss opting in with your new aged care provider beforehand.