Aged care daily fees and costs guide

Moving into a residential aged care home is a big decision, and it’s important to understand the different fees and charges you may need to pay. These depend on the aged care home you choose, the level of care you need, the services available and your finances.

Services Australia (formerly The Department of Human Services) assesses and determines your financial circumstances and your ability to pay for your required aged care services.
We recommend seeking independent financial advice when you start looking to move into a residential aged care home to understand your situation and the best payment option for you.

 

Cost of aged care in Australia

Aged care daily fees are broken down into four areas:

1. Care

Care costs relate to the clinical care you will receive while living in an aged care home. The government can partially or fully fund it. The cost of aged care will depend on the level of care you need (determined by a care assessment) and your ability to contribute to the cost (determined by a means assessment). If you’re required to contribute to care costs, it’s called a means tested care fee.

2. Accommodation costs

Accommodation costs depend on the specific home and room you choose. Services Australia assesses the amount you contribute towards accommodation costs following a means assessment. Depending on your means assessment, if you are required to pay for your accommodation in full or contribute to the cost, several options are available. The government can subsidise your accommodation costs to a maximum of $55 per day, meaning you may need to pay part of the cost.

3. Living (basic daily fee)

Living costs encompass a range of services accessible once you live in a home. This aged care daily fee is paid by all residents in care. They include all day-to-day services like meals, laundry, cleaning, lifestyle activities and additional services. For some people, this is the only fee they are required to pay.

4. Additional services

There are extra costs depending on your preferences. For example, some aged care homes have premium rooms  and offer extras such as:

• paid/satellite tv;
• phone and internet;
• onsite hairdresser and beautician;
• special therapies such as massage, aromatherapy and hydrotherapy;
• facilities like a gym, pool, cinema, workshop and library; and
• a wider choice of meals and inclusions such as beer, wine and spirits.

 

Basic daily fee

This covers essential living costs and applies every day of your residency, even for short absences like hospital stays or vacations. You'll typically pay this fee fortnightly or monthly.

You can never be charged more than 85% of the single age pension for your basic daily fee at a government-subsidised aged care home. As of 20 March 2024, the maximum basic daily fee was $60.86 per day or $22,213.90 per year. Because this is tied to the pension, it goes up twice a year.

 

Means tested care fee

While basic costs are associated with aged care, you may also need to pay a means tested care fee to cover the cost of residential aged care. This is an additional contribution that is determined by your income and assets. Your means tested care fee will be between $0 and $416.05 per day.

Here’s how it works:

1. The assessment

Services Australia assesses your financial situation to determine the fee.

They consider your income and assets.

• Income: This includes your pensions, wages and any other income sources.
• Assets: This includes your savings, investments and the value of your home (with some exemptions).

 

2. Calculating the fee

Based on your income and assets, Services Australia calculates a means tested amount (MTA).

This MTA is then compared to a government benchmark. As of March 2024, the Maximum Accommodation Supplement Amount (MASA) is around $66.94 per day.

3. The sliding scale

You'll likely have a means-tested care fee if your MTA is higher than the MASA.

The difference between your MTA and the MASA determines the daily fee you contribute. This fee falls between $0 and $416.05 per day.

The higher your income and assets, the closer your MTA will be to the daily maximum, resulting in a higher contribution.

4. Caps and protections

There are annual and lifetime caps on means tested care fees. In March 2024, the annual cap is $32,718.57, and the lifetime cap is $78,524.69. Once you reach a cap, the government covers the rest.

Your family home is usually exempt from the means test if a spouse or dependent adult child lives there. Otherwise, its value is capped for the assessment.

For further information, read our aged care costs resource or call Estia Health at 1300 682 833.

If you’re looking for other aged care services, such as home care support, visit My Aged Care.