Aged Care – fees and charges 065-19103017

Staff can give this information to customers. Refer customers to the aged care means assessment line or if there is an Aged Care Specialist Officer (ACSO) in their area offer to book the customer in for a face-to-face appointment if more information is required.

The Australian Government may subsidise a care recipient’s cost of care. If they can afford to, the care recipient also contributes depending on their income and assets. Services Australia or Department of Veterans’ Affairs (DVA) complete a means assessment to determine the amount.

Cost of care is the amount of subsidies and primary supplements the government pays to the aged care provider for providing care to the care recipient. The subsidy is reduced by the amount of the income or means tested fee the care recipient pays directly to the provider.

See the Process page for fees and charges information in the Aged Care Staff Portal (ACSP) and the Aged Care Provider Portal (ACPP).

See Resources for Fees and Subsidies by Scheme and Resident Status.

Care recipients dissatisfied with their means assessment can have the assessment reviewed by Services Australia or DVA, see Initial contact about a decision and the review of decision process.

Residential care

Entered care pre 1 July 2014:

• Basic daily fees are paid at different rates depending on resident status
• Income tested fees are paid when the total assessable income is in excess of the relevant aged care total assessable income free area, plus
• An accommodation component, either:
• A daily accommodation charge determined by the value of the care recipient's assets on the date of entry into permanent residential aged care, or
• An accommodation bond negotiated directly with the aged care service provider
• Extra service fees are paid by care recipients in an extra service facility

Entered care on or after 1 July 2014:

• Basic daily fees are paid at different rates depending on resident status
• Means tested care fees are an additional contribution. The amount is determined by the means assessment
• An Accommodation payment, is paid as either a:
• Refundable Accommodation Deposit (RAD), or
• Daily Accommodation Contribution (DAC)
• The amount is based on the care recipient’s income and assets
• Extra service fees are paid by care recipients in an extra service facility

Home care

Entered care pre 1 July 2014:

• Basic daily fees are paid at different rates depending on the home care package level
• Income tested fees are paid where the service provider has asked a care recipient to pay an income tested fee. Note: under pre 1 July 2014 schemes the Department of Health and Aged Care is responsible for home care means assessments

Entered care on or after 1 July 2014:

• Basic daily fees are paid at different rates depending on the home care package level
• Income tested fees may be paid in addition to the basic daily fee. The amount is based on the care recipient’s income

Basic daily fee (BDF)

• paid by the care recipient
• paid daily from the date they enter home care
• calculated daily
• indexed on 20 March and 20 September each year, in line with increases to the Age Pension
• not payable while on leave from home care (in transition care or residential respite care)
• payable while on social leave or hospital leave

Before 1 July 2019, BDF was 17.5% of the single basic Age Pension for all care levels. This also applied to members of a couple.

From 1 July 2019, four levels of BDF align to home care package levels 1, 2, 3 and 4, replacing the previous single BDF.

If a care recipient lodges an application for financial hardship assistance prior to an assignment of a home care package, their highest approved care level is used to calculate any BDF hardship assistance.

Income tested fee (ITF)

A care recipient pays ITF if their income is over the maximum income threshold for a full pensioner.

Entered care before 1 July 2014:

• the fee can be up to 50% of the care recipient’s income above the Age Pension amount
• the Department of Health and Aged Care is responsible for the means assessment

Entered care on or after 1 July 2014:

• the fee is different for everyone because it is based on their means assessment
• Services Australia or Department of Veterans’ Affairs are responsible for the means assessment

See the Resources page for a link to the Department of Health and Aged Care’s Schedule of Fees and Charges.

Entered care pre 1 July 2014:

Basic daily fee (BDF)

• paid by the care recipient
• paid daily from the date they enter permanent residential care
• is indexed on 20 March and 20 September each year, in line with increases to the Age Pension
• the rate is standard, non-standard or protected
• the standard rate is set at 85% of the single basic Age Pension and is the same for both single and members of a couple
• the non-standard and protected rates apply to some residents who were in care before 20 September 2009

Income tested fees (ITF)

Some care recipients pay an ITF. This is an additional amount determined by a means assessment.

• pay an ITF if income above set thresholds
• the amount is set at the lower of the:
• calculated income tested fee amount
• cost of care, or
• maximum income tested fee amount
• the maximum ITF is 135% of the single basic Age Pension and is subject to indexation
• a daily cap applies to ITF for pre-1 July 2014 care recipients limiting the amount of contribution to their care costs
  Note: care recipients who were provided with care at any time after 30 September 1997 and before
  1 March 1998, for any entry assessed under a pre 1 July 2014 assessment scheme, have Care Subsidy to Zero applied for an ITF liability where their income is over the threshold

The Resources page has a link to the Department of Health and Aged Care’s Schedules of Fees and Charges.

Entered care on or after 1 July 2014:

Basic daily fee (BDF)

• equal to 85% of the single basic Age Pension
• paid by the care recipient
• paid daily from the date they enter permanent residential care
• is indexed on 20 March and 20 September each year, in line with increases to the Age Pension

Means tested care fees (MTCF)

Some care recipients pay a MTCF. This is an additional amount determined by a means assessment.

• the MTCF is based on the care recipient’s means and their cost of care as per their:
• Aged Care Funding Instrument (ACFI) assessment before 1 October 2022, or
• AN-ACC assessment from 1 October 2022 onwards
• the amount is set at the lower of:
• their means tested amount or
• their cost of care
• annual and lifetime caps limit how much MTCF a care recipient pays
• indexation of annual and lifetime caps occurs on 20 March and 20 September each year, in line with the Age Pension
• Services Australia advises care recipients, aged care nominees and providers when the cap is reached

MTCF – AN-ACC and cost of care

From 1 October 2022, the Department of Health and Aged Care replaced the Aged Care Funding Instrument (ACFI) with a new funding model - Australian National Aged Care Classification (AN-ACC).

There is no change to the means assessment process for care recipients. However, it does affect the care recipient's cost of care and may affect their Means Tested Care Fees (MTCF) rates. This change results in changes to the cost of care for most care recipients. It also increases the income and assets rates that cause care recipients to pay maximum fees.

This affects MTCF for care recipients who are either:

• Means Not Disclosed (MND) and liable to pay the full cost of their care, or
• Assessed as having high income and/or assets which make them liable to pay most or all of the cost of their care

New care recipients: Care recipients who enter permanent residential care from 1 October 2022 have a default AN-ACC rating applied - Class 99 - pending completion of an AN-ACC assessment to determine the cost of their care. This occurs unless they are entering for the purpose of palliative care, which has default Class 98.

Existing care recipients:

From 1 October 2022:

• The following have their care assessed under the AN-ACC funding model:
• Care recipients who have had AN-ACC assessments completed over the last 12 months, and
• All care recipients in permanent residential care as at 1 October 2022
• Aged care services started to get their funding based on their AN-ACC

A reassessment of a care recipients' MTCF occurred as part of a Quarterly Review. Many care recipients had new MTCF rates applied from date of effect, 28 October 2022. Services Australia sent fee change letters (RC63) to care recipients/nominees to tell them about the new fees from 28 October 2022, which may have been due to changes to the amount of means tested care fee because of the start of AN-ACC on 1 October 2022. (There are no changes to Annual and lifetime cap thresholds.)

See the Comparison between ACFI and AN-ACC table for some real examples of changes to the cost of care because of the funding model changing from ACFI to AN-ACC.

Accommodation payments

An accommodation payment is a contribution towards, or full payment for the care recipient’s room that they may have to pay depending on their assessed income and assets.

Each provider sets its own pricing, depending on factors such as facility location and room size. The amount a care recipient pays for their accommodation depends on their eligibility for government help.

The type of accommodation payments payable is dependent on the date the care recipient entered permanent residential care and their available means to pay the accommodation cost.

Entered care pre 1 July 2014:

• Accommodation charge
• Accommodation bond

See Aged Care means assessment - Residential Care pre 1 July 2014 - assets assessment for further detail.

Entered care on or after 1 July 2014:

• resident is eligible for government assistance with their accommodation costs and pays either:
• a Refundable Accommodation Contribution (RAC)
• a Daily Accommodation Contribution (DAC) or
• a combination of these two
• resident is not eligible for government assistance with their accommodation costs and pays either:
• a Refundable Accommodation Deposit (RAD)
• a Daily Accommodation Payment (DAP) or
• a combination of these two

See Aged care fees and charges - accommodation payments for further detail.

Note: if a care recipient chooses to pay a lump sum, any unused money is refundable when they depart aged care.

Care recipients residing in extra service facilities pay extra service fees. Extra service facilities provide a higher standard of accommodation not extra care.

A care recipient negotiates the extra service fee amount with their service provider. Services Australia is not involved in determining extra service fees. Extra service fees are not based on either an asset or income assessment. There is no maximum limit for extra service fees.

Extra service fees are regulated for care recipients who entered care on or after 1 July 2014. Aged care providers with dedicated extra service places must publish their extra service fees on the My Aged Care website, their own website and in other relevant materials provided to prospective care recipients.

On the day a resident permanently leaves a service, they can be charged:

• a basic daily fee
• an accommodation payment (If applicable)

They cannot be charged:

• a means-tested fee
• an accommodation contribution