Ageing and aged care in Australia
The number of people age 65 and over in Australia is projected to more than double, to 8.8 million, over the next 40 years.1 This will undoubtedly mean an increased need for aged care in the community putting pressure on families and Government funding.
In Australia, the Government subsidises different types of aged care services to cater for older people’s needs and to support their carers – usually their family. This is a sensitive and complex area and for many of us it’s a decision we will need to make for ourselves or a family member in the future. It makes sense to understand the process and plan ahead to ensure your family member receives the care they need when they need it.
Receiving help at home
Initially, for most people, receiving care at home is the most convenient and the least unsettling option. There are two levels of support.
1. Entry-level support: The Commonwealth Home Support Programme
The Commonwealth Home Support Programme (CHSP) can provide ongoing or short-term care and support services including planned respite care to give you or your carer a break, help with housework, personal care, meals and food preparation, transport, shopping, health and social support.
To access the CHSP, you need to have a home support assessment completed by a local assessor from a Regional Assessment Service (RAS).2 The RAS assessor will work with you and your family member to develop a support plan that reflects their entry-level aged care needs, goals and preferences.
The Government subsidises a range of services where an income and assets assessment is not required. You will simply need to discuss and agree any fees with the service provider.
2. Complex support: The Home Care Packages Program
When your aged care needs increase, you can be reassessed to receive a Home Care Package to meet specific care needs within the home.
An Aged Care Assessment Team (ACAT) will assess your Home Care Package needs. In Victoria, this is known as Aged Care Assessment Services (ACAS). There are four levels of home care packages to meet care needs, ranging from basic to high.
The Government provides a different subsidy amount for each level of home care package. You will need to contribute to the cost of your care if your income level, including any Age Pension you receive, exceeds certain thresholds. This is called the income-tested care fee and it’s capped at $15.24 per day for part pensioners and $30.49 per day for self-funded retirees (as at November 2019).
On top of the income-tested care fee, you need to pay basic daily care fees of between $9.52 and $10.63 depending on the home care package level (as at November 2019).
Receiving care in a residential aged care home
If you or a family member can no longer live at home, there is the option to move into a residential aged care home. An age care home provides accommodation and help with everyday tasks, personal care or 24-hour nursing care.
Care and services that are provided include:
- hotel services such as bedding, cleaning, meals, social activities and help in emergencies
- personal care assistance such as eating, dressing, arranging access to health professionals and emotional support
- complex care and services, such as nursing and therapy services.
You or your family member’s care needs will be assessed and approved by ACAT (ACAS in Victoria).
Finding a home
Each home is different, so visiting some homes will help you to find out what you can expect. You’ll be able to see what the accommodation is like and what types of care, services and activities they offer.
It generally takes a few weeks to receive the assessment results from ACAT and can take one to three months to find a suitable aged care home.
The Government pays for the bulk of age care costs, however, you are required to contribute to the cost of care based on your financial situation. You and your partner’s income and assets will be used to determine the fees that are applicable. Your family home will not be included in the assessment if it is occupied by certain protected persons such as a spouse, a carer or close relative, under certain circumstances.
You currently need to pay one or more of the following in an aged care home:
|An accommodation payment||Covers the accommodation in the home.|
|A basic daily fee||Covers living costs such as meals, power and laundry.||Currently $51.63 per day|
|A means-tested care fee||This is an additional contribution towards the cost of your care.||Based on you and your partner’s assets and income level. The means-tested care fee is currently capped at $27,755 per year and is also subject to a lifetime cap of $66,611. These amounts are indexed on an annual basis.|
|Fees for extra services||Extra service fees may apply if you choose a higher standard of accommodation with an extra service status.||The services and fees vary from home to home and must be published.|
|Additional fees||Depending on your assessed care needs, you may be asked to pay additional fees for some of the complex care services provided that are critical to your care needs.||The additional fees can only be charged if you are receiving a direct benefit from the care or services the aged care home is providing that they are not required to provide by law.|
Aged care can be complex and, like other financial decisions, it makes sense to understand the options available so you and your family can make suitable arrangements as well as good financial decisions.
If you or a family member needs aged care, please contact your financial adviser. If you don’t have an adviser we can put you in touch with one.