Sweeping reforms to aged care began on the 1st November to help improve the quality, transparency and flexibility of care.
With more care levels, clearer pricing, and greater control over how your funding is used, the new system aims to better match services to individual needs. Providers will be required to offer detailed cost breakdowns, empowering you to make informed decisions about your care.
While the reforms are a step forward in care quality, they also come with changes in how services are funded, and that may mean higher out-of-pocket costs for some.
What you pay depends on your financial situation, whether you receive a full or part pension or are self-funded and the services you access.
As the aged care landscape evolves, staying informed is key to making confident choices. Whether you're planning for yourself or supporting a loved one, understanding the new system will help you access the right care at the right time.
On the 1st of November, the current Home Care Packages will be replaced by a new program called Support at Home.
The key changes include:
Services are expected to remain the same, but the way you pay for them may change.
If you were approved for a Home Care Package on or before 12 September 2024, you will be eligible for fee concessions to ensure you are not worse off under the new rules.
The package level you are assigned sets the total funding available to pay for care, with 10% allocated to the care provider to cover the cost of care management.
You then work with your provider to decide how you want to spend the rest of the budget. The provider will set their fees for services, and you will make a contribution based on your income.
Room prices in aged care facilities have been steadily rising following an increase in the Refundable Accommodation Deposit (RAD) threshold from $550,000 to $750,000.
Higher RADs mean you may need to use more of your savings or income to cover aged care costs.
From 1 November 2025, anyone who moves into care after this date and pays a RAD will have 2% of that amount deducted each year, for up to five years.
You can still opt to pay a Daily Accommodation Payment (DAP), but this will increase every six months in line with inflation.
Other fees include:
The lifetime cap on aged care contributions continues. You won’t pay more than $130,000 (indexed) over your lifetime towards home care and residential care combined.
Understanding how the changes affect your financial future is vital. You’ll need to consider:
Use the government’s fee estimator at MyAgedCare to get a clearer picture of your potential costs.
Navigating aged care can be complex, and the upcoming changes add new layers of decision-making.
We can help explain your options, structure your assets, minimise fees and plan for your future care needs.
If you would like to discuss your aged care options, please give us a call.
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