Aged care means assessment 065-09000000

Item

Description

1

Care recipients in receipt of a means tested income support payment

A means assessment will automatically finalise on entry to permanent care via the data matching process based on the details held on the Centrelink record when the following criteria are met:

• the customer receives a current means tested income support payment (for example, not Blind pensions or Self-Funded Retirees)
• homeownership is coded on the Accommodation (AC) screen as one of the following:
• NHO - Non homeowner
• NHN - Non homeowner Lives in Nursing Home
• PLT - Purchased Life Tenancy
• GFN - Non homeowner in Govt funded Aged Care
• LIF - Bequeathed Life Interest
• DEE - Deemed Interest

A care recipient in receipt of a means tested income support payment who is a non-homeowner can complete a pre-admission means assessment via a verbal assessment.

A care recipient who is in receipt of a means tested income support payment from the agency and a homeowner needs to provide details of their principal home. This information is not recorded for Social Security purposes.

Principal home details can be provided:

• verbally, or,
• by completing:
• an online Aged Care calculation of your cost of care
• a Residential Aged Care – Property details for Centrelink and DVA customers (SA485) form

If documentation is required, such as a statement showing the refund of an entry contribution for a retirement village unit, the care recipient must complete an online application or the SA485.

Care recipients in receipt of a means tested income support payment from DVA are required to complete an SA485.

2

Total assessable assets for aged care

The value of a care recipient’s assets is worked out in accordance with the assessment of assets under the Social Security Act. Refer to Division 1 of Part 3.12 of the Social Security Act – General provisions relating to the assets test.

The Aged Care Act specifies the provisions of the Social Security Act that do not apply. The following are assets that are assessed under the Aged Care Act which are exempt assets according to the Social Security Act:

• the value of any interest in the principal home, see Aged care means assessment – home ownership and real estate estimates
• accommodation payments, these are also not able to be reduced by the value of any encumbrance, see Aged care fees and charges - accommodation payments

3

Total assessable income for aged care

Total assessable income = pension income + direct deductions + ordinary income.

Note: the RCA Income Assessment Summary (RIAS) screen Income Stream details are not displaying correctly. This is a display only error and does not affect the assessable income of a means assessment. See Network News Update (NNU) Aged Care RIAS screen Income Streams details not displaying correctly (11439) for more information.

4

Direct deductions

Direct deductions are amounts that reduce the customer’s rate of pension but are excluded from the definition of ordinary income, for example, foreign pension or periodic compensation payments.

5

Ordinary (non-pension) income for aged care

Ordinary income is income that would be used to determine a pension rate calculation as in Social Security Act 1991, section 1064, Module E - Ordinary income test. For aged care purposes, ordinary (non-pension) income for a couple is added up and then assessed as 50% of total income.

For a full list of income and assets assessed under Social Security law, see the Resources page in Coding income and assets for Centrelink payments and services.

6

Pension income for aged care

For a couple, only the income support payment received by the care recipient is taken into account. The income support payment is not halved. The rates between each member of a couple may vary, for example one party is blind and on maximum basic rate while the other is on a reduced rate due to other income.

Pension income for aged care purposes is made up of the care recipient's income support payment (for example Age Pension,) including:

• Basic Pension Amount (BASIC)
• Pension Supplement Basic Amount (PSBAS)
• Pension Supplement Remaining Amount (PSREM)

It does not include:

• Pension Supplement Minimum Amount (PSMIN)
• Clean Energy Supplement (CES)

To view the components of an income support payment:

• Access the Payment Summary (PS) screen
• Press [Enter] twice

The Pension Details Component (PDC) screen is displayed.

See Rates and Thresholds for information on Pension Supplement rates.

7

Self-funded retirees and care recipients not in receipt of current means tested income support payment

From 12 October 2024 onwards, Process Direct creates a new aged care claim activity if the care recipient is matched to a Centrelink non-current record or to a current non-means tested income support payment. Their benefit status will display as RCA/CUR-SFR. Note: before 12 October 2024, Customer First was the system that created these aged care claim activities.

Home Equity Access Scheme customers who are ‘loan only’ recipients (they do not receive a payable rate of pension) will have a benefit status of RCA/CUR-SFR and are considered to be non-pensioners. A message 'RCA status is SFR because 100% PLS' will display on the RCA Income Assessment Summary (RIAS) screen.

8

DVA Disability Pension

DVA Disability Pension is not an income support payment and it is not means tested. Recipients are treated as self-funded retirees unless they also receive an income support payment from Services Australia or DVA.

DVA Disability Pension is treated as income for social security purposes and it will also be treated as income for aged care purposes unless the care recipient has qualifying service.

DVA provides income assessments for aged care purposes for their income support customers and the DVA Disability Pension and DVA War Widows Pension customers who have qualifying service.

All other DVA Disability Pension recipients have their income assessed for aged care purposes by the agency. The Residential Aged Care Calculation of your cost of care (SA457) identifies whether a DVA customer has qualifying service. Where appropriate, the completed SA457 is forwarded by the agency to DVA for processing.

9

Foreign income assessment

For autonomous pensioners, any foreign income is regarded as ordinary income in accordance with section 44-24 of the Aged Care Act of 1997. It is included in the income assessments provided to Department of Health and Aged Care for both pre-2008 and post-2008 reform residents.

For agreement pensioners, any foreign income that is a direct deduction is not regarded as ordinary income. It is included as part of the total assessable income for aged care purposes in accordance with section 44-24 of the Aged Care Act of 1997.

10

Income from employment

Employment income is included in an aged care resident's total assessable income for aged care purposes after any reduction for Work Bonus or Working Credit has been applied. This is in line with the assessment of earned income for pension purposes.

If a Work Bonus or Working Credit deduction is applied to the customer's gross earned income, the amount deducted displays on the RCA Income Assessment Summary (RIAS) screen in the WB/WC Reduct field.

The WB/WC Reduct field will only appear on the RIAS screen if a Work Bonus or Working Credit deduction has been made.

Note: self-funded retirees cannot qualify for either Work Bonus or Working Credit deductions because they are not in receipt of an income support payment.

11

Income test component of means assessment

The Standard resident total assessable income free area is equivalent to the:

• maximum rate of single basic pension, plus
• pension allowable income amount (based on whether the customer is single or a member of a couple), plus
• single pension supplement minus the single minimum pension supplement

Note: the Standard resident amount also applies to both Non Standard and Phased residents.

The protected residents total assessable income free area is equivalent to the:

• maximum rate of non-quarantined (resident in Australia) single basic transitional rate of pension, plus
• pension allowable income amount (based on whether the customer is single or a member of a couple), plus
• single pension supplement minus the single minimum pension supplement

See Rates and Thresholds for information on current pension allowable income thresholds and rates of payment. Rates of payment are found in the Pensions category in L-P payment rates and thresholds.

Assessable income over the assessable income free area is used to calculate the income test component of the means assessment.

12

Asset test component of means assessment

The asset free area is the amount equal to 2.25 times the basic age pension amount rounded down.

The first asset threshold and second asset threshold amounts are determined by Aged Care legislation and are indexed in March and September each year.

Assessable assets (in order) are used to calculate the asset test component of the means assessment:

• Total assets below asset free area = $0
• Total assets between the asset free area and first asset threshold:
• total assets – asset free area x 17.5%
• Total assets between first and second asset thresholds:
• (total assets – first asset threshold x 1%) + (first asset threshold – asset free area x 17.5%)
• Total assets above second asset threshold:
• (total assets – second asset threshold x 2%) + (second asset threshold – first asset threshold x 1%) + (first asset threshold – asset free area x 17.5%)

13

How the principal home is assessed for means assessment purposes

Unless a protected person occupies the principal home at the relevant time, it will be included in the means assessment.

The home’s value is capped to the equivalent value of the first asset threshold. See the Department of Health and Aged Care - Schedule of fees and charges for current first asset threshold values.

14

Who is a protected person for exempting the principle home for means purposes

A protected person is defined by the Aged Care Act 1997 as a:

• partner or dependent child
• carer who lived in the principle home for the past 2 years and is eligible to receive an income support payment, or
• close relative who has lived in the home for the past 5 years and is eligible to receive an income support payment

The exemption of the principal home is lost if the protected person subsequently moves out of it.

See Aged care means assessment – protected person for more information.

15

Financial disclosure to service providers

Aged care service providers are no longer able to access financial information for care recipients.

A form was previously used for care recipients to give consent to release financial information to aged care services. This process has been decommissioned. Any Display on Access (DOA) docs located on a care recipient’s record should be ended.

16

How income from ABSTUDY payments is assessed for aged care means assessment purposes

Payments made under the ABSTUDY scheme are not included as assessable income for aged care means assessment purposes under the Aged Care Act 1997.

17

How income from Status Resolution Support Services (SRSS) payment is assessed for aged care means assessment purposes

Payments made for SRSS are not included as assessable income for aged care means assessment purposes under the Aged Care Act 1997.

Item

Example

1

Not low means care recipient

See Department of Health and Aged Care – Schedule of fees and charges.

Single homeowner, no mortgage, home is not exempt

• Total assessable income = $50,000
• Total assessable assets = $1,201,231.20
• Value of home is capped at $201,231.20
• Remaining assets net value $1,000,000
• Income free area = $32,819.80 per annum
• Asset Free area = $59,500
• First asset threshold is $201,231.20
• Second asset threshold is $484,693.60
• Maximum accommodation supplement = $68.14 per day

Income test component of means assessment

• Total assessable income = $50,000 p/a
• Single income free area = $32,819.80 p/a
• $50,000 - $32,819.80 = $17,180.20
• $17,180.20 / 2 = $8,590.10 p/a
• $8,590.10 / 364 = $23.60 per day

Asset test component of means assessment

• Total assessable assets = $1,201,231.20
• Asset free area = $59,500
• ($201,231.20 - $59,500) x 17.5% = $24,802.96
• ($484,693.60 - $201,231.20) x 1% = $2,834.62
• ($1,201,231.20 - $484,693.60) x 2% = $14,330.75
• Asset amount = $41,968.33
• $41,968.33 / 364 = $115.30 per day

Daily means tested amount = income test result + asset test result

• Daily means tested amount = $23.60 + 115.30
• Daily means tested amount = $138.90
• Means tested fee = daily means tested amount - maximum accommodation supplement
• Means tested fee = $138.90 - $68.14
• Means tested fee = $70.75 (for example, maximum applicable means tested fee. The actual fee payable will also depend on the relevant Australian National Aged Care Classification (AN-ACC) for the care recipient)

Residential aged care means assessment result:

As the care recipient's means tested amount ($138.90), is more than the maximum accommodation supplement ($68.14), they are not a low means resident.

Care recipient is liable to pay:

• an accommodation payment that is negotiated with service provider
• a basic daily care fee, and
• a daily means tested fee of up to $70.75 per day depending on cost of care

2

Low means care recipient

Partnered (illness separated) homeowner

• Home is exempt as partner occupying home
• Total assessable income (customer) = $39,550.20 p/a
• Total assessable assets (customer) = $85,000
• Income free area = $32,195.80
• Asset Free area $59,500
• Maximum accommodation supplement = $68.14 per day

Income Test component of means assessment

• Total assessable income = $39,550.20 p/a
• Illness separated income free area = $32,195.80 p/a
• $39,550.20 - $32,195.80 = $7,354.40 p/a
• $7,354.40 / 2 = $3,677.20 p/a
• $3,677.20 / 364 = $10.10 per day

Asset test component of means assessment

• Total assessable assets = $85,000
• Asset free area = $59,500
• $85,000 - $59,500 = $25,500 x 17.5% = $4,462.50
• $4,462.50 / 364 = $12.26 per day

Daily means tested amount = income test result + asset test result

• Daily means tested amount = $10.10 + $12.26
• Total daily means tested amount = $22.36 per day
• Means tested fee = daily means tested amount - maximum accommodation supplement
• Accommodation contribution = total daily means tested amount

Note: a care recipient is still charged the calculated accommodation contribution if it is less than $1.00 per day. A daily means tested fee is not charged if it is calculated at less than $1.00 per day.

Residential aged care means assessment result:

As the care recipient's daily means tested amount is less than the maximum accommodation supplement ($68.14), they are a low means care recipient.

The care recipient is liable to pay:

• a basic daily care fee only
• an accommodation contribution of $22.36 per day

Step

Action

1

Signature requirements

Signature requirements for Aged Care Calculation of your cost of care differ from Social Security forms. Unlike Social Security forms, if an Aged Care Calculation of your cost of care form is:

• signed by a care recipient or authorised third party anywhere on the form, the form can be accepted
• unsigned, it can be accepted following verbal contact in some circumstances

2

Form is signed and the signatory is a person other than the care recipient

Where a person other than the care recipient has signed the form, they must also provide a name and contact details to aged care skill tagged staff to determine whether that person is an authorised third party.

Where a means assessment is requested by a third party who is not recorded as an authorised third party, they will need to provide documentation before any assessment can be accepted. Documentation needs to confirm that the person is an Enduring Power of Attorney, Power of Attorney (financial) or holds an administrative or financial order. See Accepting information from and disclosing information to a Power of Attorney for identity requirements.

A person can apply for a calculation of your cost of care on behalf of someone else if:

• a letter from a doctor, nurse or similar health professional is provided stating that the care recipient is unable to sign the form, or
• the application is made by the Director of Nursing (DoN) at the aged care home where the care recipient is a resident and supporting evidence is provided. For example, acceptable supporting evidence may be a stamp of the aged care home details, the DoN’s registration number, or letter attached. If further clarification is required, contact the DoN by phone to confirm details

Where the care recipient is deceased:

• only the executor of the estate or person holding a letter of administration can sign/act on their behalf
• any previous power of attorney or guardianship orders are no longer valid

Where acceptable documentation is received with the form:

• The form can be accepted
• In circumstances where a document authorises more than one person jointly, all authorised parties must have signed the form

Where acceptable documentation has not been provided with the form:

• the form cannot be accepted
• there is no authority to contact the signatory as they are not an authorised third party:
• An Aged Care Request for Information letter must be sent to the care recipient asking for either their signature, or 1 of the previously listed documents that authorises the third party to sign on their behalf
• See the Resources page for link to the Request for Further Information letter templates

complete a Progress of Claim DOC with action taken

3

Form is not signed

Where the care recipient or authorised third party has not signed the form, an attempt must be made to contact the care recipient or authorised third party by phone to confirm:

• they have requested the assessment
• the details within the form

Where phone contact can be made, if the aged care skill tagged officer is satisfied that the information lodged is sufficient for the assessment to be completed correctly:

• the assessment may be completed
• they must DOC the record with action taken

Where the Aged Care skill tagged officer:

• is unable to make phone contact, and/or
• has any concerns about the identity of the person completing the form, and/or
• has any concerns about the completeness or accuracy of the information provided. The following action must be undertaken:
• send an aged care request for Information letter asking for the outstanding information or signature to be provided
• DOC the record with action taken