Information Sheet 9 - Fees and Charges for Residential Aged Care - An Overview
Information sheet providing detailed information in relation to community and residential care issues for older Australians, young people with disabilities and their carers and the associated costs.
- Aged Care Australia Website
- Call - 1800 200 422
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PDF printable version of Information Sheet 9 - Fees and Charges for Residential Aged Care - An Overview (PDF 313 KB)
Residents in Australian Government subsidised residential aged care can be asked to pay fees as a contribution towards accommodation costs, living expenses and the cost of their care. There are protections in place to ensure that care is affordable for all residents. The Government recognises that not all residents can pay for the cost of the care they receive, and so provides substantial subsidies to assist with these costs.
Details on dollar amounts have not been included in this information sheet. For this detailed information, residents or their nominated representatives can call 1800 200 422*.
Current rates of aged care fees, charges and thresholds are listed on the Schedule of Resident Fees and Charges which is available on the Department of Health and Ageing website: www.health.gov.au.
What are the feesA resident may be charged for the care and services provided, as follows:
- Basic daily fee – as a contribution toward accommodation and costs of daily living.
- Income tested fee – as a contribution towards the costs of care.
- Accommodation payment – as a contribution towards capital accommodation costs.
- Extra services charge – applies to residents occupying an extra service place (both permanent and respite) for the provision of a significantly higher standard of accommodation, services and food.
- Additional service fee – where the resident requests or agrees to additional services (such as newspapers and hairdressing).
The level of a resident's daily fees and accommodation payment can be negotiated between the resident and/or their representative, and the aged care home.
However, the Australian Government sets the maximum level of the daily fees and accommodation payments a resident can be asked to pay to the aged care home.
Basic Daily Fee
All residents in aged care, including respite residents, can be asked to pay a basic daily fee as a contribution towards accommodation costs and living expenses, like meals, cleaning, laundry, heating and cooling.
The maximum basic daily fee for most permanent residents who first enter an aged care home on or after 1 July 2012 is 85% of the annual single basic age pension. This is also the maximum fee for all respite residents, excluding those receiving respite care on an extra service basis.
NoteThe Department of Veterans’ Affairs pays the basic daily fee for Australian ex-prisoners of war in Australian Government subsidised residential aged care.
Income Tested FeeResidents (other than respite residents) may be asked to pay an income tested fee, depending on their income and the level of care they require (Refer to Information Sheet 11 – Income Tested Fees for Residential Care for more detail).
This fee is paid directly to the aged care home. No resident will pay more than they can afford, and no resident will pay more than the cost of their care.
The Australian Government sets the maximum amount a resident can be asked to pay to the aged care home.
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Accommodation PaymentThe two types of accommodation payment are accommodation bonds and accommodation charges. (Refer to Information Sheet 16 – Accommodation Bonds for Residential Aged Care and Information Sheet 15 – The Accommodation Charge for Residential Aged Care for more detail). You cannot be asked to pay both at the same time.
Accommodation BondResidents with sufficient assets who require low (hostel) level care or who enter an extra service place may be asked to pay a bond.
The Australian Government sets the minimum assets a resident must retain when establishing the bond amount. A resident cannot, therefore, be charged a bond amount that would leave them with less than the minimum asset amount. Where a bond is payable, the amount and payment method can vary and should be negotiated with the aged care home.
The aged care home is able to retain a monthly amount from the bond for the first five years, and the balance of the bond is repaid to the resident or their estate when they leave the aged care home.
Accommodation ChargeA resident with sufficient assets who requires high (nursing home) level care (but not on an extra service basis) may be asked to pay an accommodation charge. Whether a resident requires high level care is determined at the time of entry to a permanent place by the evidence available at that time.
While the Department of Health and Ageing or the aged care provider will inform the resident of the maximum amount of accommodation charge they can be asked to pay (based on the value of their assets), the actual amount payable can be negotiated between the resident and the aged care provider.
If a resident chooses not to have an asset assessment, or has assets above the upper assets threshold, the amount of the accommodation charge they may be asked to pay will be the maximum applicable rate.
Financial Hardship AssistanceFinancial hardship provisions are there for residents who would face genuine financial hardship if they were required to pay residential aged care fees and charges. To receive an application for financial hardship assistance call 1800 200 422*. The application is also available from the Department's website at www.health.gov.au
Financial InformationFinancial decisions, for instance about how to pay an accommodation bond or charge, can have different effects on a person’s pension, aged care fees and tax. People are advised to seek expert financial information to help make these decisions.
A free Financial Information Service is available through Centrelink. To make an appointment call Centrelink on 13 23 00*.
Appointment of a nomineeResidents can nominate someone to deal with Centrelink, the Department of Veterans’ Affairs and the Department of Health and Ageing on their behalf.
It is important to note that separate forms are required for these departments as, due to privacy laws, the nominee information provided to Centrelink or the Department of Veterans’ Affairs cannot be transferred to the Department of Health and Ageing.
The Appointment of a Nominee form for the Department of Health and Ageing may be available from the aged care provider or can be accessed by phoning 1800 200 422*. The form is also available from the Department's website at www.health.gov.au
Further InformationFurther information can be found at the Aged Care Australia website www.agedcareaustralia.gov.au or by calling 1800 200 422*.
Note:Reference to a partner and/or couple includes both opposite and same sex couples.
- Calls to 1800 numbers are generally free to the caller when made from a land line.
- Calls to 13 or 1300 numbers are charged at a low fixed amount to the caller when made from a land line.
- All calls made from mobile phones are charged at the rates applicable to each phone provider.
- All calls made from public phones are charged at the rates applicable to each phone provider.
All information in this publication is correct as at September 2012
Disclaimer: This document is only a guide to the Government’s law and policies, and cannot take account of individual circumstances. The Australian Government Department of Health and Ageing recommends that you seek appropriate professional advice relevant to your particular situation.
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