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3.4.1 Overview

People who were in residential care on 30 June 2014 remain under their fee arrangements unless they leave care for more than 28 days or move to a new facility and elect to be covered by the new arrangements. They are referred to as continuing care residents . If a resident chooses to opt in to the post 1 July 2014 arrangements, they will need to be assessed as a new entrant.

3.4.1.1 Pre 1 July 2014 care fees

There are two main types of care fees that residents may be asked to pay:

Residents with sufficient income could be asked to pay an income-tested fee but there was no asset testing for care fees.

Residents may also be asked to pay an extra service fee. This is an extra payment if a higher standard of accommodation is chosen or additional services, such as hairdressing or pay TV in rooms, is elected.

3.4.1.2 Pre 1 July 2014 accommodation payments

There are two categories of accommodation payments:

Residents with sufficient assets could be asked to make an accommodation payment. The assets assessment for their accommodation bond/charge is based on a snapshot of the person's circumstances as at their date of entry to care or the date the determination was made.

 

 

 

A resident who was in care prior to 1 July 2014, who has not had a break in care of more than 28 days (other than approved leave) and who has not moved services and elected to be covered by the new arrangements. They are subject to the fee and assessment arrangements as they existed on 30 June 2014.

A contribution towards day-to-day living costs such as meals, cleaning, laundry, heating and cooling. Everyone entering an aged care home or taking up a Home Care Package can be asked by their service provider to pay the basic fee.

A care recipient’s contribution toward the cost of a Home Care package if the person has sufficient income.

An accommodation bond is an amount of money paid by Low Level Care and Extra Service Care residents in an aged care facility. An accommodation bond may be paid as a lump sum, or by periodic payments, or a combination of both lump sum and periodic payments.

The provider can deduct a monthly retention amount, for a maximum of 5 years, from the accommodation bond. The monthly retention amount is a fixed amount specified in the accommodation agreement and cannot exceed the capped maximum amount applicable at the time of entry to the facility. The provider also retains any interest derived from the bond.

The balance of the lump sum accommodation bond is refundable to the resident or their estate on departure.  The refunded accommodation bond balance is an assessable asset.

If there is a liability under the accommodation bond agreement for the bond to be paid wholly, or partly by periodic payments and the former principal home is rented out, then both the former home and the rental income are exempt from the income and assets tests.

 

 

An accommodation charge is an additional daily fee, which is paid by person's residing in ACAT approved permanent High Level Care.

It is paid in addition to the standard resident daily care fee and any additional income tested fee, which may apply.

Accommodation charges are payable for as long as a resident remains in care.  For those residents who entered care prior to 1 July 2004 the accommodation charge is limited to a maximum five years.

 

See Also:

http://clik.dva.gov.au/glossary/acat - defintion of ACAT

http://clik.dva.gov.au/glossary/high-level-care - definition of 'High Level Care'

 

 

An accommodation charge only applies to those persons entering an aged care facility prior to 1 July 2014.