Today marks the start of a new fee structure for aged care in Australia, with self-funded retirees and some pensioners expected to pay more. The changes are projected to save the government $12.6 billion over 11 years. The government will continue covering health-related costs, but those with financial means will pay more for other services.
The new system applies only to future recipients, not current care recipients. Home care will still be assessed based on need, but there will now be eight levels of support instead of four, with annual government funding up to $78,000, increased from $60,000. This budget can be used for approved services, with costs split between government and individuals based on financial means and service category.
For clinical care, the government budget covers the full cost. For independence and everyday living supports, recipients contribute based on their means. A government regulator will set maximum prices for home care services for the first time to prevent overcharging. Examples show a full pensioner at level five paying 6% of care costs, while a self-funded retiree without a Commonwealth Seniors Health Card pays 42%.
A $25,000 payment will help recipients spend their final three months at home, and a new 12-week program aids recovery from illness or injury. Existing home care recipients will switch to the new system but are guaranteed not to pay more than under the old system. The government has also lowered maximum administrative fees, leaving up to 27% more for care, though providers may increase prices.
Advocates have raised concerns about the definition of non-clinical care, which may require partial out-of-pocket payments for services like showering and medication assistance. In residential care, the basic daily fee remains unchanged, but the means-tested fee is renamed the non-clinical care fee, with a maximum of $101.16 per day for the first four years. The maximum accommodation charge rises from $550,000 to $750,000 per room.
A new $12.55 per day hotelling supplement will be paid by residents with assets over $238,000 or income over $95,400. The family home is still assessed only up to about $200,000. Overall, three in 10 full pensioners and three in four part pensioners will contribute more, but a lifetime cap of $130,000 on non-clinical care costs applies to both home and residential care.
