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.
Currently there are 2 different fee arrangements that can apply to residents. From 1 November 2025, this will increase to 3 different fee arrangements.
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.
Currently there are 2 different accommodation arrangements that can apply to residents. From 1 November 2025, this will increase to 3 different accommodation arrangements.
Which arrangements apply
When a resident enters your care, Services Australia will send you and the resident a fee advice letter. The letter won’t specify which set of arrangements apply to the resident (e.g. ‘1 July 2014 fee/accommodation arrangements’). Instead, it will state which fees apply to them and the amounts they must pay.
It will also 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.
Contact Services Australia if you have questions about which fee or accommodation arrangements apply to a resident.
Providers are responsible for charging their residents the correct:
- types and amounts of fees
- types of accommodation costs.
Arrangements won’t always match
From 1 November 2025, a resident’s fee arrangements and accommodation arrangements won’t always match. For example, the 1 November 2025 accommodation arrangements can apply to a resident on the 1 July 2014 fee arrangements.
Their accommodation arrangements might not change when their fee arrangements do.
Pre-1 July 2014 fee arrangements
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
- don’t choose to opt 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.
A resident on these fee arrangements may pay:
- a basic daily fee (at one of 3 rates)
- an income tested fee
- 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 may be on the 1 July 2014 fee arrangements.
1. They enter care on or after 1 July 2014 and before 1 November 2025
A resident will be on these fee arrangements if they enter care on or after 1 July 2014 and before 1 November 2025 and:
- 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 choose to opt 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 (that is, they were on the pre-1 July 2014 arrangements) and chose to opt in to the 1 July 2014 arrangements.
Residents cannot opt in to the 1 July 2014 fee arrangements from 1 November 2025. They can, however, choose to opt in to the new 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 receiving a Home Care Package, or approved and waiting for a package, on 12 September 2024.
They will remain on these fee arrangements unless they choose to opt in to the new 1 November 2025 fee arrangements.
Fees under these arrangements
A resident on the 1 July 2014 fee arrangements may pay:
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 will apply to residents who enter care on or after 1 November 2025.
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.
Pre-1 July 2014 accommodation 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.
1 July 2014 accommodation 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.
1 November 2025 accommodation 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 will apply to residents on these accommodation arrangements in most circumstances.
