seniors pathway guide
how much does aged care cost?
Choosing an aged care service or home can be a complicated process, with the price often a major factor when narrowing down the options.
Care and accommodation costs and additional fees can all have an impact on your loved one’s retirement plan, pension and superannuation.
It is important to understand the fees to be paid before committing to any aged care service so your loved one can work within their budget.
Select any of the arrows below to learn more.
How much does home care cost?
The amount to be paid will depend on the level of care required. A Level 1 Home Care Package covers basic care needs whilst a Level 4 Package covers high care needs
The assessment completed by the Aged Care Assessment Team (or ACAT) will include information on the level of your loved one’s Home Care Package.
- Basic daily fee
The basic daily fee costs up to $12.14 depending on the level of care required.
- Income-tested care fee
Depending on your income, your loved one may be required to pay an additional ongoing fee (up to $38.84, subject to annual and lifetime caps). Use My Aged Care’s fee estimator to get an estimate of their income-tested care fee.
- Additional fees
If your loved one requires extra care or services outside of your package, they may be asked by their service provider to pay additional fees.
How much does short-term care cost?
The cost of short-term care, delivered in either your loved one’s home or in an aged care home on a temporary basis, depends on where your loved one stays overnight. No income- or means-testing will be required to secure short-term care, however the aged care provider may ask for information about your loved one’s ability to pay for their care.
Short-term care delivered in your loved one’s home will incur a charge of up to $12.14 per day (or 17.5% of the single Age Pension) whilst care delivered in an aged care home will incur a charge of up to $58.98 per day (or 85% of the single Age Pension).
Temporary respite care delivered in an aged care home will attract a charge of up to $58.98 per day. Your loved one may also be asked by the service provider to pay a booking fee as well as additional and/or extra service fees.
How much does residential aged care cost?
The cost of residential aged care is made up of care and accommodation costs. How much your loved one will pay depends on the type of accommodation you choose and whether they are eligible for government assistance. Here is a breakdown of the various costs and fees:
- Basic daily fee
This is currently set at 85% of the single person rate of the basic Age Pension (or $58.98 per day). This percentage is set by the Australian Government and updated in March and September each year.
The basic daily fee covers day-to-day services such as meals, laundry, housekeeping and facilities management. The fee applies even if your loved one is absent from the aged care home (e.g. if they are in hospital or on holiday).
- Means-tested care fee
Depending on the outcome of your loved one’s Centrelink Assets and Income assessment, they may be required to pay an additional ongoing fee (up to $358.41 per day with an annual and lifetime cap). This goes towards care costs, which covers assistance with using the bathroom, bathing, dressing and grooming, as well as clinical care such as specialised nursing services, medication or catheter assistance.
- Additional service fees
Your loved one may be asked to pay for services outside of those covered by the basic daily fee, such as hairdressing, massage, personal training, pay TV or a premium brand of toiletries.
- Extra service fees
Some aged care facilities package several add-ons and charge for these at a fixed price. Examples include having higher quality linen and furnishings or gourmet menu options
Both the additional service fees and extra service fees are set by the aged care provider.
Each aged care home sets their own accommodation pricing. Room prices can be negotiated with the aged care provider and it can be paid as a refundable lump sum, a daily rate (similar to rental payments) or a combination of both. The price is usually determined by the location of the aged care home, the size of the room and whether it is single, shared or has an adjoining ensuite.
Your Centrelink Assets and Income assessment will determine whether you are eligible for government help to cover your accommodation costs.
Is aged care government subsidised?
Yes, the Australian Government pays subsidies and supplement funding to some (but not all) aged care providers to make them more affordable and accessible. Your loved one’s income and/or assets will determine whether they will be eligible to receive government assistance.
- Depending on their income, your loved one may have to cover some or all of the basic daily fee as well as an income-tested care fee.
Residential aged care
- Depending on your loved one’s income and the value of their assets, they may have to cover some or all of their basic daily fee and accommodation costs, as well as a means-tested care fee.
- Accommodation costs are fully subsidised for those with an income less than $31,140.20 and assets worth less than $57,000.
- Those with an income of more than $78,816.92 p.a and assets worth more than $193,219.20 will be required to cover the full accommodation cost.
- Those who fall in between the income thresholds pay an amount that is determined by their Centrelink Assets and Income assessment.
Residential aged care supplements
Your loved one may be eligible for additional government funding in some circumstances.
- Primary supplements are available to those who require more advanced medical care such as enteral feeding and oxygen.
- Other supplements are available for veterans, those experiencing hardship or those situated in rural and remote areas.
Speak to a Seniors Pathway consultant to learn about what government subsidies you can access.
What is the Centrelink Assets and Income assessment?
The Assets and Income assessment is managed by Services Australia (Centrelink) and used to determine if your loved one will be required to contribute to the cost of care through a means-tested care fee, or whether they’re eligible to receive government assistance for their basic daily fee or accommodation costs.
Your loved one will need to complete this assessment if they are a self-funded retiree, or if they are a home owner and they are currently receiving means-tested income support payments such as the Age Pension, Age Pension (blind), Disability Pension, Disability Support Pension (blind) and Mobility Allowance.
Those receiving an income support payment and are non-home owners will not need to complete this assessment.
To complete this assessment, your loved one will need to submit an Aged Care Calculation of your cost of care form (SA486) along with supporting documents. They will be notified of the outcome through a fee advice letter, which is valid for 120 days.
Contact our experienced team for help with completing your loved one’s Centrelink Assets and Income assessment.
How can my loved one afford care?
Even with all of this information, it can still be difficult to understand exactly how much your loved one’s care will cost out of pocket. We recommend taking the following steps to better understand their financial position and optimal budget for accommodation.
Seniors Pathway can help you get the most out of your budget
Our extensive experience with Australia’s aged care system allows us to guide you through the financial side of this life-changing decision.
Once we have all the information specific to your loved one’s financial situation, we can calculate the out-of-pocket care costs and set a budget for accommodation.
On top of this, our connections with aged care providers across Adelaide help us to more successfully negotiate prices and deliver the best outcome for you and your loved one.
Find out about our aged care placement services to get the support you need.