Accommodation Fees and Charges

Basic Daily Fees

Accommodation Fees are paid by all residents in care.  These Daily Care Fees cover living costs such as meals, power and laundry.  For some people these are the only fees they are required to pay.

The basic fee is set at 85% of the single person rate of the basic aged pension (excluding the Supplement Allowance).  As at 20/03/2017. this works out at $49.07 a day (changes on the 20th. March and 20th. September of each year).  This figure is the same for singles and members of a couple.

Accommodation Payment

Changes to Accommodation payments effective 1 July 2014
The Federal Government has introduced a number of reforms under its “Living Longer, Living Better” legislations.

What is Changing?

From 1 July 2014, there were changes to how new residents are charged for accommodation. These changes affected new residents who entered residential aged care homes after this date.
New residents will have a choice as to how they pay the agreed accommodation price, either as a lump sum refundable deposit (similar to an accommodation bond), a periodic payment or a combination of both.

Depending upon a person’s financial circumstances as confirmed by their Assets and Income Assessment, the periodical payment can be drawn down from the refundable deposit.

From the 1 July 2014 the MAXIMUM Refundable Accommodation Deposit (RAD) that Providers may request from prospective residents will be: $550,000
– All single rooms with private ensuites – $550,000 or MAXIMUM Daily Accommodation Payment (DAP) is $87.09. The RAD is the same for all rooms as they are all identical in nature and amenities.

The differences between high care and low care have been removed, the same system will apply for all new residents. New residents will have up to 28 days after they enter care to decide how they will pay.

How can you pay for accommodation?

New residents will have the choice to pay for their accommodation either as a refundable deposit (a lump sum, also known as a Refundable Accommodation Deposit or ‘RAD’), an equivalent daily payment (a periodic payment, also known as a Daily Accommodation Payment or ‘DAP’) or a combination of both.

New residents will have up to 28 days from entering care to choose whether to pay the agreed accommodation price by a refundable deposit, daily payment or combination of both. The default payment method is the daily payment, unless or until a refundable deposit is paid.

Daily payment can be paid by the resident or drawn from a refundable deposit the resident has paid to the provider if the resident has elected to pay a combination of a refundable deposit and a daily payment.

Drawing daily payments from the refundable deposit

Drawing daily payments from the refundable deposit.

How is the equivalent daily payment calculated?

To calculate the equivalent daily payment of a refundable deposit, the refundable deposit is multiplied by the maximum permissible interest rate (MPIR) then divided by 365 days.
For example, a refundable deposit of $550,000 would have an equivalent daily payment of $71.26 per day.

(Refundable deposit x MPIR)/365 = ($550,000 x 5.78)/365 = $87.09 per day.

An example of a combination payment for a $550,000 price may be combination of refundable deposit of $300,000 and a daily payment of $39.58 per day, with the daily payment determined as follows: (Balance of price x MPIR)/365 = [($550,000 – $300,000) x 5.78%]/365 = $39.58 per day.

Confused? We don’t blame you! Contact us to discuss and we will take you through the various scenarios.

*Note: The MPIR is currently 5.78% as of 1 April 2017 – 30 June 2017.

The rate of interest is updated every three months and is determined by the Federal Government.
For any further information or to check the current rates you can also visit the My Aged Care website at

Means-Tested Care Fee

This is an additional contribution towards the cost of care that some people may be required to pay.  Department of Human Services (Centrelink) or the Department of Veterans’ Affairs will work out if you are required to pay this fee based on an assessment of your income and assets, and will advise you of the amount.

There are annual and lifetime caps that apply to the means-tested care fee.  Once these caps are reached, you cannot be asked to pay any more means-tested care fees.

There is an annual limit on the maximum amount you can be asked to pay in means tested care fees.  At present, the annual limit is $26,380.51.  Once you reach this figure, the Australian Government will pay the rest of your means tested care fees to the provider.

There is lifetime cap on income tested care fees (in home care) and means tested care fees (in residential care) of $63,313.28.  Once you have reached this cap you will not have to pay any further income or means tested care fees during your lifetime.

Department of Human Services (Centrelink) or Department of Veterans’ Affairs will let you and your provider know when you have reached the annual or lifetime caps.  The lifetime cap only applies to income tested care fees (and means tested care fees in residential care).  You may still need to pay the relevant basic fee and any accommodation costs in residential care.

Your family home will continue to be exempt from any means testing if your spouse or dependent adult child (referred to as a protected person) is living in the home.  Your home will be included in the means test if a protected person does not live there, but its value will be capped at a maximum of $162,087.20.

Any income-tested care fees you have paid since 1 July 2014 in a Home Care Package prior to moving into an aged care home will also contribute to your annual lifetime caps.

Fees For Additional Optional Services

Additional fees apply for additional services such as hairdressing or mobile xray.

You can find out more about aged care charges by following this link to the Department of Health and Ageing.