About fee and accommodation arrangements
Different types of fee and accommodation arrangements can apply to residents.
A resident’s fee arrangements determine the:
- means tested fees they pay
- means testing thresholds, taper rates and caps that apply to them.
A resident’s accommodation arrangements determine:
- what they pay for their accommodation
- the payment options they can choose from
- whether refundable accommodation deposit or refundable accommodation contribution (RAD or RAC) retention and daily accommodation payment (DAP) indexation apply to them.
New fee and accommodation arrangements were introduced when the Aged Care Act 2024 commenced on 1 November 2025.
There are 3 different fee arrangements that can apply to residents:
- 1 November 2025 fee arrangements
- 1 July 2014 fee arrangements
- Pre-1 July 2014 fee arrangements.
There are 3 different accommodation arrangements that can apply to residents:
- 1 November 2025 accommodation arrangements
- 1 July 2014 accommodation arrangements
- Pre-1 July 2014 accommodation arrangements.
Which arrangements apply
When a resident enters your care, Services Australia sends you and the resident a fee advice letter.
The letter lists the fees and amounts payable but does not name the arrangements that apply (e.g. ‘1 July 2014 fee/accommodation arrangements’).
It will state whether a resident pays an:
- accommodation payment (amount agreed between you and the resident)
- accommodation contribution and the amount payable
- accommodation bond (amount agreed between you and the resident)
- accommodation charge and the amount payable.
If you have questions about which arrangements apply to a resident, contact Services Australia.
Providers are responsible for charging the correct:
- types and amounts of fees
- types of accommodation costs.
Important to know
A resident’s fee and accommodation arrangements don’t always match.
- For example, a resident may be on the 1 November 2025 accommodation arrangements but still on the 1 July 2014 fee arrangements.
- Their accommodation arrangements might not change when their fee arrangements do.
Residents can choose to opt in to newer arrangements. It's important for them to get financial advice before they make this decision, because it can't be undone.
A resident’s fee arrangements will not change if they exit care and re-enter, regardless of how long the break is. However, a break in care of more than 28 consecutive days (not counting approved leave) can change their accommodation arrangements.
1 November 2025 fee arrangements
This fact sheet can help explain these fee arrangements to your residents:
Understanding fees for aged care homes – 1 November 2025 fee arrangements
Who they apply to
The 1 November 2025 fee arrangements apply to residents who enter care on or after 1 November 2025 and are not covered by the ‘no worse off’ principle. They also apply to those who were on earlier fee arrangements and opted in to the newer ones.
Fees under these arrangements
A resident on the 1 November 2025 fee arrangements may pay:
- a basic daily fee
- a hotelling contribution
- a non-clinical care contribution
- fees for optional services.
1 July 2014 fee arrangements
This fact sheet can help explain these fee arrangements to your residents:
Understanding fees for aged care homes – 1 July 2014 fee arrangements
Who they apply to
There are 3 scenarios where a resident will be on the 1 July 2014 fee arrangements.
1. They entered care on or after 1 July 2014 and before 1 November 2025
A resident will be on these fee arrangements if they entered care on or after 1 July 2014 and before 1 November 2025 and:
- were either:
- still in care on 1 November 2025, or
- exited care for no more than 28 days over the period when the new Act started
- have not opted in to the 1 November 2025 fee arrangements.
2. They entered care before 1 July 2014 and opted in to these arrangements
A resident will be on these fee arrangements if they entered care before 1 July 2014 (on the pre-1 July 2014 arrangements) and opted in to the 1 July 2014 arrangements.
Residents can no longer opt in to the 1 July 2014 fee arrangements. They can opt in to the 1 November 2025 fee arrangements.
3. They are covered by the ‘no worse off’ principle
A resident will be on these fee arrangements if they:
- enter care on or after 1 November 2025, and
- were approved for or receiving a Home Care Package on 12 September 2024.
They stay on these fee arrangements unless they opt in to the 1 November 2025 fee arrangements.
Fees under these arrangements
A resident on the 1 July 2014 fee arrangements may pay:
Pre-1 July 2014 fee arrangements
Who they apply to
The pre-1 July 2014 fee arrangements apply to residents who entered care before 1 July 2014 and:
- didn’t opt in to the 1 July 2014 fee arrangements
- didn’t exit residential care for more than 28 days (other than on approved leave) between 1 July 2014 and 1 November 2025
- have not opted in to the 1 November 2025 fee arrangements.
They will remain on these fee arrangements unless they choose to opt in to the current fee arrangements.
Fees under these arrangements
A resident on the pre-1 July 2014 fee arrangements may pay:
- a basic daily fee (at one of 3 rates)
- an income tested fee
- fees for optional services.
1 November 2025 accommodation arrangements
Who they apply to
Most people on the 1 November 2025 accommodation arrangements will have first entered permanent residential care on or after 1 November 2025. This includes people who are eligible for the ‘no worse off’ principle under Support at Home.
There are 2 other ways a person can be covered by the 1 November 2025 arrangements:
1. They were already in care before 1 November 2025 and opt in
A resident who entered care before 1 November 2025 will be on these arrangements if they opt in to them before or at the time they move to another aged care home.
2. They return to care following a break of more than 28 days
A resident will move to these accommodation arrangements if:
- they first entered residential care before 1 November 2025, and
- they return to care after a break of more than 28 days, where:
- the break started on or after 1 November 2025, and
- the break happened because they were discharged from care (not in hospital or on approved leave).
Accommodation costs under these arrangements
A resident on the 1 November 2025 accommodation arrangements may contribute to their accommodation costs through an accommodation payment or contribution.
RAD/RAC retention and DAP indexation apply to residents on these accommodation arrangements in most circumstances.
1 July 2014 accommodation arrangements
Who they apply to
There are 2 scenarios where a resident may be on the 1 July 2014 accommodation arrangements.
1. They entered care on or after 1 July 2014 and before 1 November 2025
A resident will be on these accommodation arrangements if they entered care on or after 1 July 2014 and before 1 November 2025 and:
- on 1 November 2025 were either:
- still in care, or
- out of care for a total of no more than 28 consecutive days (including that date) not counting any approved leave
- don’t opt in to the 1 November 2025 fee arrangements before or at the time they moved aged care homes.
2. They entered care before 1 July 2014 and opted in
A resident will be on these accommodation arrangements if they entered care before 1 July 2014 (on the pre-1 July 2014 accommodation arrangements) and opted in to the 1 July 2014 accommodation arrangements.
As of 1 November 2025, residents can no longer opt in to the 1 July 2014 accommodation arrangements. They can opt in to the 1 November 2025 accommodation arrangements.
Accommodation costs under these arrangements
A resident on the 1 July 2014 accommodation arrangements may contribute to their accommodation costs through an accommodation payment or contribution.
RAD/RAC retention and DAP indexation do not apply to residents on these accommodation arrangements.
Pre-1 July 2014 accommodation arrangements
Who they apply to
The pre-1 July 2014 accommodation arrangements apply to residents who entered care before 1 July 2014 and:
- didn’t opt in to the 1 July 2014 fee arrangements
- didn’t exit residential care for more than 28 days (other than on approved leave) between 1 July 2014 and 1 November 2025
- don’t opt in to the 1 November 2025 fee arrangements before or at the time of moving aged care homes.
They will remain on these accommodation arrangements unless they choose to opt in to the current fee arrangements before or at the time they move aged care homes.
Accommodation costs under these arrangements
A resident on the pre-1 July 2014 accommodation arrangements who has assets above the minimum asset value on the day they entered care may contribute to their accommodation costs through a bond or charge.
Contacts
Residential aged care fees contact