Residential Care Costs

The financial side of Aged Care may become confusing. A multitude of government processes and terms to comply with can easily become overwhelming. Our role is to provide a clear and current explanation of your options.

There are three different cost types for residential aged care and they are the basic daily fee, means-tested care fee and accommodation payments.

Basic Daily Fee

Residents are required to pay a basic daily fee which goes towards meals, cleaning, laundry and other day to day costs of living. The current government set maximum daily fee for all residents is 85% of the basic single age pension. This fee increases slightly each year in March and September and is currently $53.56.  This amount is paid by direct debit fortnightly in advance

Means Tested Care Fee (MTCF)

Depending on your income and your assets, you may be asked to pay a means-tested care fee. This is an additional contribution to your cost of care and will be determined by Centrelink. This is not a fixed cost and it might adjust if your assets, income or cost of care changes. The maximum means-tested fee you may be asked to pay is $28,792.36 per year and $69,101.75 over a lifetime.  Means-tested care fees are paid by direct debit fortnightly in advance.

Refundable Accommodation Deposit (RAD)

A Refundable Accommodation Deposit (RAD) is a lump sum accommodation payment that is assigned to every aged care room in Australia. This payment is fully refundable when you leave. If you decide not to pay RAD in full, you may choose to pay a smaller deposit combined with a Daily Accommodation Payment (DAP). Your DAP is adjusted based on the amount you are able to pay upfront. The more you are able to pay upfront, the lower the amount of DAP.

The DAP is calculated by converting the RAD into a daily charge using the Maximum Permissible Interest Rate (MPIR) that applied at the time of admission. The MPIR is at a rate set by the Federal Government. The DAP is invoiced fortnightly.

NCCCA’s current RAD’s are:

Fully Supported Residents

If your assets are less than $51,500 and you have an income less than $28,472.60 you’ll be fully supported by the Australian Government and won’t need to pay the accommodation payment. To get this support you need to provide us with an Income and Asset Statement (link to Centrelink Form).

Partially Supported Residents

Residents with assets between $51,500 – $175,239.20 are deemed to be ‘partially supported’ by the Australian Government, subject to their income level. As a partially supported resident you’re required to contribute to some of the costs of your accommodation.

You have the option to pay a Refundable Accommodation Contribution (RAC) or a Daily Accommodation Contribution (DAC).

The exact amount will be determined by Centrelink. To get this support you need to provide us with an Income and Asset Statement (link to Centrelink). To learn more about your financial and legal rights please contact My Aged Care (link to website).

Financial Advice

Any decision regarding your care, or the care of a loved one should be an informed one. NCCCA strongly recommends you speak with your trusted financial advisor before making any commitment, as they are best placed to provide a recommendation tailored to your individual financial position.

Please contact us to discuss your situation with one of our friendly team.