The first step is to register for a government Aged Care Assessment Services (ACAS) assessment through the My Aged Care website. The ACAS assessment is your passport into the world of residential aged care as it enters the resident into the government system and produces a clinical report.
Once complete, you can then give us a call to start discussing the financial considerations of aged care and we will guide you through the process.
When looking for a room in a residential aged care facility residents will be quoted a RAD price. The RAD, Refundable Accommodation Deposit, is the lump-sum price of the room that can be paid 1 of 3 ways:
- The full RAD is paid up front – this is up to 90% refundable when you leave the facility and guaranteed by the federal government
- A Daily Accommodation Payment (DAP) is paid in the form of daily interest payments
- A combination of the RAD and DAP is paid
Importantly, if you qualify as a low means resident you may not be required to pay a RAD.
This is the most common question we get asked and the short answer is, not necessarily. The family home is often a couple’s most valuable asset, and many advisers wrongly assume that it needs to be sold to provide funds for RADs. RADs can be paid via an up-front lump-sum payment, a combination payment or a Daily Accommodation Payment.
For the purposes of the aged pension the home is exempt for 2 years after a resident move into care. Then, from year 3 onwards the home is no longer considered a principal place of residence and instead considered an investment property. As a result, keeping the home can impact the pension.
On the other hand, for the purposes of the Centrelink means tested fee, the home is always counted as an asset, but its value is capped at just over $200,000. Therefore, when the home is sold and the full value of the home is included as an asset, the means tested fee is increased.
Yes, the government pays facilities over $400 per day for every bed that is occupied in an Aged Care facility.
Previously called the Centrelink Means Tested Care Fee, this fee is set by the government and collected by the aged care facility.
A resident’s non-clinical care contribution amount depends on their income and assets. It is an attempt by the government to ask residents with the financial capacity to contribute to the cost of care.
This fee can range from $0 to over $109 per day and has a lifetime cap of roughly $140,000. The fee stops being charged after 4 years if the cap has not been hit by then.
The amount of means tested fee you will be required to pay is reviewed monthly so it’s important to keep Centrelink up to date with changes in your financial circumstances.
Not necessarily, in some cases, it may not be beneficial to lodge documentation with Centrelink.
Whilst many aged care facilities will ask you to fill in forms when you visit, updating Centrelink should be the final step in the process, not the first step!
The rules governing aged care fees and contributions changed with the introduction of the Aged Care Fees and Contributions Act 2025, which came into effect on 1 November 2025.
This new legislation replaced the previous framework and updated how accommodation costs, daily living services (including the Higher Everyday Living Fee), and non-clinical care contributions (NCCC) are calculated, capped, and indexed.
Residents who were already in care before 1 November 2025 are grandfathered under the previous arrangements for existing fees, unless they choose to move to a new fee structure.
The RAD is an excluded asset for social security purposes and is not assessed in the pension calculation. Therefore, in some cases, where existing cash is used to pay for a RAD, it can result in a new or increased pension entitlement.
In addition, for the purposes of the pension the home is exempt for 2 years after a resident move into care. From year 3 onwards the home is no longer considered a principal place of residence and instead considered an investment property, which may result in the loss of the pension.
If the family home is sold to fund the RAD the proceeds from its sale are counted as an asset. The cash remaining after paying the RAD can often result in a pension being reduced or lost entirely.
When a member of a couple enters care, the couple are considered to be a ‘couple separated by illness’. As a result, instead of being eligible for a couple’s pension, they become eligible for 2 separate individual pensions, which is a greater amount. This is still the case if the second member of the couple joins the first in care.
Previously called an Extra or Additional Services Fee, this fee can range from $0 to as much as $120 per day, provides the resident extra services such as Foxtel, Wi-Fi, activities, outings, daily newspapers, more meal choice and access to people like podiatrists, hairdressers etc.
If your aged care facility is charging a HELF, you should ask what services are being delivered and assess whether or not you are receiving value for money. This fee, too, may be negotiated and reduced.
The Hotelling Supplement Contribution, covers services like catering, cleaning, and laundry. It was previously paid by the government, but has not been shifted to the residents in care.
The HSC is means-tested, so residents may be required to pay part or all of the fee. Any remaining balance is covered by the government for those who can't afford to pay the full amount.
- If the RAD is priced under $750k the facility can set the price themselves
- If the RAD is more than $750k the facility must get approval from the Aged Care Pricing Commission
To get approval to price a room above $750k the facility must satisfy a 5-page document of requirements. Once approved, the facility may only increase the price with CPI.
RADs can be as high as $2 million to secure a bed in an aged care facility. In many cases these RADs are negotiable, and at times can be as much as halved.
Willingness to negotiate on RADs depends very much on the demand and supply of beds in a particular aged care facility.
In a government-accredited aged care facility, the Refundable Accommodation Deposit (RAD) is up to 90% refundable and government guaranteed.
Providers may retain 2% of the RAD per year, known as a retention amount, up to 10% over the first five years.
Yes, Residential Aged Care in Australia is governed by the Federal Aged Care Act, so the same rules & regulations apply for every aged care facility in Australia.
We have assisted families all around the country transition their loved ones into care.
Respite is a fantastic word in the world of Aged Care – it essentially means ‘try before you buy’. Respite is a short-term 2+ week stay in an aged care facility that allows carers and loved ones to have a break knowing that the resident is looked after.
Compared to permanent care, respite care is cheaper and easier to arrange and is often a good first step before moving someone into permanent care.
All residents are granted 63 days (9 weeks) of respite, but facilities are not obligated to provide the full allotment of days.
The 9 weeks are designed to provide families with multiple 2–4-week breaks over the course of a year so most facilities will only provide 2-4 weeks of respite at a time, rather than the full 9 weeks.
A protected person is defined as one of the following:
- Your partner or dependent child
- Your carer who is eligible to receive an Australian Government income support payment and who has lived in your home with you for the past 2 years
- Your close relative who is eligible to receive an Australian Government income support payment and who has lived in your home with you for the past 5 years
If your home is occupied by a protected person, it may not be counted as an asset for aged care purposes.
If someone does not own a home (or their home is occupied by a protected person), and has less than roughly $200k in assets, they may be considered a low means resident.
Low Means Residents face a different set of costs to full fee-paying residents and can often secure a similar bed in an aged care facility for a fraction of the price.
The assessment of low means is done on the day someone enters permanent care. If a resident enters as a low means resident, they remain under this classification unless they move aged care facilities.
A fully supported bed can be granted to anyone with assessable assets below roughly $63,000 that does not own a home.
Fully Supported residents may be able to get a bed in an aged care facility for only 85% of their daily pension.
Australia is a fantastic country, and nobody is denied an aged care bed!
Centrelink view all assets and income belonging to a couple as combined and then assess 50% to each partner.
A fair question, you’re not the first person to ask! Unfortunately, Centrelink claw back assets over the last 5 years.
Centrelink and DVA allow pensioners to gift $10,000 per financial year and $30,000 over a rolling five-year period without affecting pension entitlements. Any other gifts are still considered by Centrelink to be an asset for a five-year period.
That is, if you were to transfer your home to your children today, it would still count as your asset for the next 5 years.
Yes, you can do this. However, funds used to pay the RAD are INCLUDED in the Centrelink means test and are treated as an asset even if those funds are paid by family members.
In addition, the funds will be refunded to the estate at end of life so it may be necessary to get a loan agreement drawn up.
Residents are able to change and update how they intend to pay the RAD at any time.
Yes, the RAD payment is only one aspect of the costs of aged care. In addition, there are a range of daily charges that will be billed by the facility monthly.
However, it is possible to have some, or all of the daily fees deducted from the RAD that has been paid to minimise the impact on your cashflow. This means of course that the DAP will increase over time and less of the RAD will be returned at the end of the care period.
No, retirement villages and aged care homes are very different and conflating the two can led to costly mistakes.
Moving into a retirement village is a lifestyle choice, not a clinical decision or financial investment. In fact, retirement villages can terminate contracts based on medical grounds if they believe a resident needs to be in aged care.
Unlike RADs which are fully refunded in aged care, when leaving a retirement village only some of the funds contributed are returned and they are often only paid out once a new resident is found for your room.
Unfortunately, your home care package ceases once you enter residential care.
The Gold Card is beneficial for home care and respite care only, not permanent residential aged care. However, it may still provide additional medical or pharmaceutical benefits which can reduce the living expenses needed while in care.