About means tested fees
There are different means tested fees residents in your care may pay. Which fees apply to a resident depends on their fee arrangements. How much they pay is calculated by Services Australia based on their income and assets in their residential aged care means assessment.
Means tested fees are paid in addition to:
- the basic daily fee
- any accommodation costs
- any optional service fees.
If a resident pays a means tested fee on top of the basic daily fee, the government pays the remainder of the cost of their care to their provider.
If a resident doesn’t pay any means tested fees, the government pays the full cost of their care to their provider.
A resident’s means tested fee amounts may change while they’re in your care if their means or cost of care change.
Upcoming changes under the new Aged Care Act
New means tested fees will be introduced when the new Aged Care Act commences on 1 November 2025.
Understanding fees for aged care homes – 1 November 2025 fee arrangements
Which fees apply to a resident
Different fees can apply depending on a resident’s fee arrangements.
The table below shows the specific means tested fees for each set of fee arrangements:
| Fee arrangements | Means tested fees a resident may pay |
|---|---|
| 1 November 2025 fee arrangements |
|
| 1 July 2014 fee arrangements |
|
| Pre-1 July 2014 fee arrangements |
|
Find out more about the different fee arrangements.
When a resident enters your care, Services Australia will send you and the resident a fee advice letter to let you know which fees apply to them and the amounts they must pay.
Contact Services Australia if you have questions about which fee arrangements apply to a resident.
Daily, annual and lifetime caps
Daily, annual and lifetime caps limit the amount a resident will pay in means tested fees.
Specific cap information for each fee arrangement is available under the relevant fee heading below.
Caps are indexed in March and September each year. The cap amount that applies for a resident is the amount current at the time the resident reaches the cap.
A resident may have paid an income tested care fee for a Home Care Package, or contributions for Support at Home before they moved into an aged care home. The amount they have paid in means tested fees will count toward their annual and lifetime caps.
Caps only apply to means tested fees. Once a resident has reached the cap, they will still need to pay the basic daily fee, any accommodation costs and any other agreed fees.
Hotelling contribution
The hotelling contribution applies to residents on the 1 November 2025 fee arrangements.
The government currently pays a hotelling supplement for each resident. This tops up the basic daily fee to cover the cost of daily living services.
The hotelling supplement will be means tested for residents on the 1 November 2025 fee arrangements. A resident on these fee arrangements with income and assets above certain thresholds will contribute to the hotelling supplement by paying a hotelling contribution.
The hotelling supplement and income and asset thresholds are indexed in March and September each year and available in the Schedule of Fees and Charges for Residential Care from 1 November 2025.
Amount a resident may pay
A resident’s hotelling contribution:
- depends on their income and assets
- will cover some or all of the hotelling supplement, with remainder of the supplement paid by the government
- will be covered in full by the government if they have income and assets below the thresholds.
Daily cap
The hotelling contribution is capped daily at the maximum hotelling supplement amount.
There is no annual or lifetime cap for the hotelling contribution.
Non-clinical care contribution
The non-clinical care contribution applies to residents on the 1 November 2025 fee arrangements.
Residents on the 1 November 2025 fee arrangements who pay the full hotelling contribution may also need to pay a non-clinical care contribution. This contributes to their non-clinical care costs such as bathing, mobility assistance and lifestyle activities.
Amount a resident may pay
A resident’s non-clinical care contribution amount depends on their income and assets.
The hotelling supplement and income and asset thresholds are indexed in March and September each year and available in the Schedule of Fees and Charges for Residential Care from 1 November 2025.
The maximum daily non-clinical are contribution and income and asset thresholds are indexed in March and September each year and available in the Schedule of Fees and Charges for Residential Care from1 November 2025.
Daily cap
The non-clinical care contribution is capped daily.
Lifetime cap
A lifetime cap applies to the non-clinical care contribution.
A resident will pay it until they either:
- reach the lifetime cap amount or
- have paid it for a total of 4 years (these don’t have to be consecutive).
The lifetime cap amount is indexed in March and September each year and will be available in the Schedule of Fees and Charges for Residential Care from 1 November 2025.
This is a combined cap with the non-clinical contributions for Support at Home.
Previous Support at Home contributions
Contributions paid for Support at Home before a person enters residential aged care:
- count towards the non-clinical care contribution lifetime cap amount
- don’t count towards the 4-year cap – this must be 4 years of paying the non-clinical care contribution for residential aged care specifically.
Services Australia will let you know when a resident reaches their lifetime cap amount or has paid this contribution for a total of 4 years. Once this happens, they will stop paying a non-clinical care contribution.
Once they stop paying the non-clinical care contribution, the government will pay the full cost of their non-clinical care.
Means tested care fee
The means tested care fee applies to residents on the 1 July 2014 fee arrangements.
Some residents on the 1 July 2014 fee arrangements pay a means tested care fee to contribute to their cost of care. This fee is different for everyone.
Amount a resident may pay
A resident’s means tested care fee is based on their:
- means assessment (income and assets)
- cost of care (adjusted basic subsidy and primary supplements).
Annual and lifetime caps
Annual and lifetime caps apply to the means tested care fee.
Once a resident reaches the annual cap, their means tested care fee is set to zero. They start paying the fee again on the next anniversary of the date they first entered aged care. Services Australia will let you know when the resident reaches their annual cap, and when their means tested care fee should start again.
A resident can’t pay their annual means tested care fees upfront, even if they will later reach the annual cap. Find out more about how to collect fees.
Services Australia will let you know when a resident reaches their lifetime cap. Once a resident reaches the lifetime cap, the government pays the full cost of their care. The resident will pay no more means tested care fees.
Income tested fee
The income tested fee applies to residents on the pre-1 July 2014 fee arrangements.
Some residents on the pre-1 July 2014 fee arrangements pay an income tested fee to contribute to their cost of care. This fee is different for everyone because it depends on their income and the cost of their care.
A resident pays this fee if their income is above the income threshold when Services Australia or DVA assesses them. The amount of income tested fee may change while the resident is in your care.
You can’t charge this fee to a resident who:
- is in respite
- is an Australian former Prisoner of War
- has a dependent child
- was in permanent residential aged care between 30 September 1997 and 1 March 1998.
Amount a resident may pay
The fee is equal to a resident's income tested amount or the cost of their care, whichever is lower. Services Australia calculates the income-tested amount. The cost of care is the amount of adjusted basic subsidy and primary supplements you get for that resident.
Daily cap
The income tested fee has a daily cap. The cap is set at 135% of the single basic age pension.
Interim fees
You may wish to start collecting fees while waiting for a resident’s means assessment. Find out more about charging interim fees and interim accommodation costs.
When a resident’s means tested fees will change
A resident’s means tested fees may change while they’re in your care.
Find out more about reviewing and updating fees.