Choosing to move into Aged Care can be a difficult time, once this decision has been made then it is very important to understand the cost implications. We recommend that you speak to your Accountant or Financial Advisor as we can only provide the basic information.
Information is also available through the Department of Health they can be contacted by calling the Aged Care information line on 1800 200 422 or you may access information by going to the My Aged Care website www.myagedcare.gov.au
Once in Aged Care you will need to pay for your Accommodation, which may either be paid by a lump sum or daily payment or a combination of each. Any lump sum payment will be refunded (less any agreed deductions or outstanding amounts) when you exit aged care.
When in residence you will pay the basic daily fee, which is currently $50.16 per day and is only ever 85% of the full Aged Pension. This provides 3 meals a day and all the other basic living expenses you are currently paying for in your own home. This figure is the same for singles and members of a couple.
From the 20th of March 2018, the maximum basic daily fee is $50.16 per day for both pensioners and non pensioners. This rate increases on the 20th of March and September each year in line with changes to the Aged Pension.
Means Tested Care Fees:
Whilst specialist Aged Care costs are funded largely by the Federal Government, you may be required to make a Co-contribution to that cost. This is an additional contribution towards the cost of care that some people may be required to pay. The Department of Human Services will work out if you are required to pay this fee based on an assessment of your income and assets, and will advise you of the amount.
Everyone entering an aged care home for the first time from 1 July 2014 will need to complete and lodge an income & assets assessment form which will be used to determine the costs. You must lodge this form even if you currently receive a means tested income support payment from Centrelink or the Department of Veterans’ Affairs (such as the Aged Pension or the Service Pension).
There are annual and lifetime caps that apply to the means tested care fee. Once these caps are reached, you cannot be asked to pay any more means tested care fees. The Co-contribution may be up to $26,566.54 per annum, subject to a $63,759.75 Lifetime Cap.
Calculating the amount payable for your Co-contribution to care, and deciding how best to pay for your accommodation is complex, with implications for pension eligibility and tax. You are likely to benefit from specialist Financial Advice.