Current location
You are here: help with aged care homes > cost > types of costs > daily care feesHelp with aged care homes
Daily care fees
- What are daily care fees?
- How much are daily care fees?
- Will my income-tested fee change?
- Who is exempt from paying an additional income-tested fee?
- How is my income assessed?
- When do I start paying the income-tested fee?
- Should I pay any fees before I move in?
- What if my income is derived from compensation?
- What effect will paying aged care fees have on my pension?
- Why do I need to provide information about my assets?
- How will I find out my correct fee?
- How will my privacy be protected?
- Examples of income-tested fees
- Further assistance
What are daily care fees?
Daily care fees are a contribution to your daily living costs, such as nursing and personal care, living expenses, meals, linen and laundry, as well as heating and cooling.
These fees will vary according to whether you are a full pensioner, part pensioner or non-pensioner.
As part of this fee, you may pay an additional income-tested care fee (more information) depending on your income and level of care (more information).
You cannot be asked to pay more than you can afford or more than the cost of your care, and most people pay much less.
A number of aged care homes providing a higher standard of food, accommodation and hotel-type services have been granted extra-service status (more information). Extra-service homes can ask residents to pay additional fees.
How much are daily care fees?
Basic daily care fees are adjusted each March and September, when pension rates are reviewed.
Full means-tested pensioners may pay the basic daily care fee, at the pensioner rate. There is no additional income-tested charge.
Part pensioners may pay the basic daily care fee, at the pensioner rate. In addition, part pensioners may be asked to pay an income-tested fee. Income-tested fees are not payable for the first 28 days in an aged care home.
Non-pensioners may pay a higher basic daily care fee, plus an additional income-tested fee.
Will my income-tested fee change?
Your income-tested fee may change from time to time, as your income changes or your level of care changes.
To make income testing simpler:
fees are set for a quarter of a year, based on your income at the start of the quarter
at the end of each quarter, you may receive a refund if your income is assessed as lower during that quarter
you will not be asked to repay money if your income has risen during the quarter, and
you will be advised at the beginning of each quarter if your fee has changed.
Who is exempt from paying an additional income-tested fee?
Most residents will not pay an additional income-tested fee. These include:the 56 per cent of residents who are full means-tested pensioners
people who were permanent residents in a home between 1 October 1997 and 28 February 1998
residents receiving respite care (more information)
some residents receiving the lowest level (more information) of care
residents with dependent children, and
residents who are former Australian prisoners of war.
If you are an Australian ex-prisoner of war, the Department of Veterans’ Affairs (DVA)will pay your basic daily care fee. You will not be income-tested or pay any income-tested daily care fees.
How is my income assessed?
When you move into an aged care home, either Centrelink (more information) or DVA will assess your income so the Department of Health and Ageing can work out the amount of income-tested fee you could be asked to pay.
If you are already receiving a pension or other income support payment from Centrelink or Veterans’ Affairs, you have already provided your income information to them and you will not need to do this again.
If you are a non-pensioner, you will be asked to provide details of your income to Centrelink. Your income will be assessed under the same income test rules that apply to the pension.
Centrelink or Veterans’ Affairs will provide your income assessment to the Department of Health and Ageing, which will then write to you to advise the maximum amount of income-tested fees that you could be charged.
If you choose not to supply your details to Centrelink or the Department of Veterans’ Affairs, you may be asked to pay the lesser amount of either:
the maximum income-tested fee, or
the full cost of the level of care you are receiving.
If you are receiving a blind pension, you must supply the same financial information to Centrelink or DVA as other pensioners do. This may include details of your income.
When do I start paying the income-tested fee?
If you are charged an income-tested fee, you won’t be asked to begin paying the fee until the 29th day from the day you accepted your place in the aged care home.
Should I pay any fees before I move in?
Other than charging a booking fee for people applying for a respite place, aged care homes cannot require you to pay application fees, donations or administrative fees before you move in.
If an aged care home asks for such a payment, you should contact the state office of the Department of Health and Ageing or your local aged care advocacy service, who will help you resolve the matter.
Read more: Useful contacts
What if my income is derived from compensation?
You may need to go into an aged care home because of an accident or another event. If you are entitled to compensation, the government may not subsidise your residential care costs.
Read more: About Compensational and assisted residents
What effect will paying aged care fees have on my pension?
Most pensioners will continue to receive the same amount of pension when they enter an aged care home. Married pensioners may each receive a higher rate of pension, under the government’s special separated due to illness (more information) provision, if one or both members of the couple are in aged care.
If you were receiving rent assistance before you moved into care, this will most likely stop after you move into an aged care home. Instead, a pensioner-supplement amount will be paid directly to the aged care home from the Department of Health and Ageing.
If you are receiving a Centrelink remote-area allowance (more information) in addition to your pension, your aged care home is entitled to charge you a portion of your allowance.
If you own a home, it will not be counted as an asset for pension purposes for up to two years after you enter the aged care home. Your family home will continue to be excluded from the pension assets test if your spouse or de facto partner continues to live there.
If you are renting your home to tenants, and paying an accommodation charge for high-level care, the value of your home and any income derived from renting it will not affect your rate of pension.
If you pay a lump-sum accommodation bond, it will not be counted as an asset for pension purposes. In addition, if you pay any part of an accommodation bond by periodic payments and you are renting out your former home, the value of your home and any rental income you earn will not affect your rate of pension.
Why do I need to provide information about my assets?
An assets assessment (more information) determines whether:
you may be eligible to pay an accommodation bond or an accommodation charge, or
if the aged care home is eligible to receive a government subsidy on your behalf.
An assets assessment also helps to clarify the maximum amount of accommodation bond or charge that you could be asked to pay.
From 1 July 2005 Centrelink and the Department of Veterans’ Affairs began assessing the assets of people entering aged care homes. Before this date, aged care homes did these assessments.
How will I find out my correct fee?
If you are a part pensioner or a non-pensioner, Centrelink or DVA will write to you about your income assessment. In addition, the Department of Health and Ageing will write to all people living in aged care homes to tell them the maximum fees that they can be charged.
If you prefer, you can nominate someone to deal with the Department of Health and Ageing on your behalf. The Appointment of a nominee form (more information) is available from your aged care home, or you can ring the Aged Care Information Line and ask for one.
To protect your privacy, information about nominees that you may have given to Centrelink or DVA cannot be transferred to the Department of Health and Ageing.
The Department of Health and Ageing will also advise your maximum fee to your aged care home, but will not provide it with information about your income.
How will my privacy be protected?
Protecting your private information is important to the Australian Government. There are very severe penalties, including imprisonment, for government officers and aged care homes who misuse your personal information.
Examples of income-tested fees
Example 1
Mrs Bell is a full pensioner with private income of $40 a week on top of her pension. Because her non-pension income is below $64 a week, she cannot be asked to pay an additional income-tested fee.
Mrs Bell could be asked to pay the basic daily care fee for a pensioner, currently up to $32.05 a day.
Example 2
Miss Reilly is single and has non-pension income of $148 a week on top of her part pension. Her maximum income-tested fee would be 25c for each dollar of non-pension income over $64 a week. She could be asked to pay $3.00 a day, in addition to the basic daily care fee for a pensioner, currently up to $32.05 a day.
Miss Reilly will pay a total daily care fee of no more than $35.05 a day, or the cost of her care if this is lower.
Example 3
Mr Kostas is a married pensioner. He and his wife have combined non-pension income of $310 a week on top of their part pensions. His maximum income-tested fee would be 25c for each dollar of non-pension income over $114 a week, divided by two. He could be asked to pay $3.50 a day, in addition to the basic daily care fee for a pensioner, currently up to $32.05 a day.
Mr Kostas will pay a total daily care fee of no more than $36.55 a day, or the cost of his care if this is lower.
Example 4
Mr Jones is a single non-pensioner with private income of $750 a week. His maximum income-tested fee would be 25c for each dollar of income over $64 a week. This means that he could be asked to pay $24.50 a day, in addition to the basic daily care fee for a non-pensioner, currently up to $32.05 a day.
He could be asked to pay a total daily care fee of no more than $62.85 (basic daily care fee plus income-tested fee), or the cost of his care if it was lower.
Note: *Daily care fees are indexed and may increase in line with changes in the age pension.
Further assistance
The Aged Care Information Line, telephone 1800 500 853, can provide further explanations of fees and charges.
