No free lunches in aged care anymore

Understanding the Real Cost of Support at Home from July

As 1 July rapidly approaches, we are seeing more detail from the Government around the changes to residential and home care – particularly around how aged care will be funded and who pays for it.

Let’s take a closer look at home care … or Support at Home as it’s going to be known.

Right now, people get assessed and approved for a home care package. The funding is provided by the Government to a client-nominated home care services provider. The provider (typically) charges a 30% to 35% combined administration and case management fee then provides a range of home care services at varying hourly rates. The Government assesses your ability to pay an income tested fee towards the selected services.  

Enter the new world … Support at Home

The Government will pay the client-nominated service provider 10% of the selected package value towards care management services.

So where does the provider make up the funding difference?

The services provided to you will be classified into three service groups: clinical care, independence and everyday living. Clinical care will be totally funded by the Government with no co-contribution for you to pay regardless of whether you are on a full- or part-pension or a self-funded retiree.

A means test that looks at your assets and income will determine your contributions towards independence and everyday living services. The co-contribution for independence services will range from 5% for full pensioners to 50% for self-funded retirees, and for everyday living it will be between 17.5% for full pensioners and 80% for self-funded retirees.

To assist providers with hourly service rates, the Government recently released a report showing “indicative” prices. Some of the rates make for interesting reading. Below is a worked example that I recently came across of what this might look like.

Shirley is a self-funded retiree who will receive a Level 5 Support at Home package which provides $40,000 a year of funding. This is what her package might look like:

• 1 hour a week of nursing and allied health, costing $9,880 – Shirley will pay $0

• 3 hours a week of independence services at a cost of around $13,000 – Shirley will pay $6,500 a year (50% of $13,000)

• 3 hours a week of help with everyday living at a cost of $15,600 – Shirley will pay $12,480 a year (80% of $15,600)

In summary, for 7 hours of services over the week (less than 1 hour a day), Shirley will need to pay almost $19,000 a year … and the Government will pay the rest ($21,000 a year).

Is it worth it?  

If Support at Home provides the care and support people need to live independently in their own home for longer … it may very well be a worthwhile investment.

It’s going to require people to really think long and hard about what care and support they need now and into the future and where to get that care and support from … either via the Support at Home program or privately somewhere else or a combination of both. 

This is where Family Aged Care Advocates can work with you to help you make this assessment and decisions. 

How Family Aged Care Advocates (FACA) work

Family Aged Care Advocates guide you and your family through this ever-changing aged care maze so you can clearly understand what all these changes exactly mean for your particular situation. Mistakes or misunderstandings can be costly and time-consuming to fix. Feel free to visit FACA at www.familyagedcareadvocates.com.au or call Shane Hayes on 0411 264 002.

Shane Hayes Family Aged Care Advocates