Understanding fees and costs of residential aged care
Making the decision to move into residential aged care can be an emotional and confusing one. There’s a lot of information to process, and decisions often have to be made quickly.
We want to empower you to make an informed choice when it comes to your care needs, so we’ve put together this information to help explain the costs associated with moving into residential aged care. We're here to help you with any questions, call 1800 448 448 or enquire now.
How much you’ll pay and what you’ll pay for is different for every person, depending on personal circumstances. But regardless of your situation and how you choose to receive our aged care services, our dedicated carers and support staff will always be here to help you every step of the way.
There are four areas when it comes to covering the costs of residential aged care.
Firstly, there is the cost of accommodation in an aged care community. Think of this like mortgage or rent. There are different ways that you can pay for your accommodation, including as a lump sum (known as a Refundable Accommodation Deposit, or RAD) or as a daily fee (known as a Daily Accommodation Payment, or DAP), or a combination of both. Find out more on the My Aged Care website.
This cost, known as a ‘basic daily fee’, covers your daily living expenses such as standard meals, laundry, power expenses (like heating and cooling), and cleaning.
The Australian Government sets the Basic Daily Fee, which is 85% of the full single pension. This is adjusted twice a year in March and September.
3. Your care – the Aged Care Funding Instrument (ACFI) Basic Care Subsidy and the means tested care fee
The Basic Care Subsidy is the contribution made by the Australian Government to aged care providers, in order to cover the cost of the care you receive from nurses, carers and other professional staff. The Aged Care Funding Instrument (ACFI) is used to assess the level of care you need, and the result of this assessment then determines how much the Australian Government pays to a residential aged care provider to care for you.
However, if your personal circumstances allow, the Australian Government expects that you’ll contribute towards the cost of your care. Based on an assessment of your income and assets, the Department of Human Services will work out if, and how much, you are required to contribute to your care costs. This is called a means tested care fee. This fee reduces the amount a residential aged care provider receives from the Australian Government for your care.
For example, Mary needs to move into residential aged care. She receives an ACFI assessment which determines that, due to her complex care needs, the amount required to cover her care costs is $200 per day. The Department of Human Services then takes a look at Mary’s income and assets and determines that she will need to help cover this cost by paying $50 per day. Therefore, Mary must pay $50 to her aged care provider for her care, and the Australian Government will pay $150 to make up the difference. The amount that Mary is asked to pay for her care is subject to annual and lifetime limits.
At Wesley Mission Queensland we provide additional services to enhance the lifestyle of all residents in our aged care communities. These services can include, but are not limited to; all day refreshments, a hot breakfast daily, WiFi, flat screen TVs, a weekly roster of scenic bus trips, and a monthly social calendar that features movie nights, craft activities, concerts, gardening groups, and much more. Additional services incur an extra cost on top of your Basic Daily Fee (see above).
Estimate your costs
The My Aged Care website has a simple fee calculator that can help you estimate of your potential costs.
Remember, we’re here to help.