The government will subsidise aged care for elderly people with low means
June Daley*, 93, shared her home with her daughter Marjorie, 66, for 15 years before she moved into residential aged care. The aged pensioner had savings of about $80,000 but nowhere near the $300,000 refundable accommodation deposit her preferred care home was asking.
Marjorie applied to Centrelink to have June’s assets and income assessed to determine what her care costs might be.
“Because I was eligible for an income support payment and had been living in the home with mum for at least five years the house was considered an exempt asset which meant she only had to make a contribution to her accommodation costs,” says Marjorie.
“We were lucky that the facility she liked offered her a bed as a low-means resident and we didn’t have to find a large lump sum,” she says.
June was asked to pay a daily accommodation contribution equal to her means-tested amount of $16.35 a day.
Aged Care Steps technical specialist Natasha Panagis says the $16.35 a day is essentially the interest payable on a refundable accommodation contribution of $95,945.
“If June wanted to reduce the amount of interest and get something back when she left the facility, she could use part of her $80,000 towards the refundable accommodation contribution,” she says.
Not everyone has a home to borrow against or sell or other assets to pay the $200,000 to $1 million in Refundable Accommodation Deposit or equivalent Daily Accommodation Payments many facilities are asking.
It may also be the case that one member of a couple needs to go into care before another but the only asset is the house in which they both live.
Where someone doesn’t have the means to pay the RAD or there is someone classified as a protected person, such as a spouse remaining in the house, they may be able to go into an aged care facility as a supported or low-means resident.
Accredited aged care services need to hold a certain number of beds for low-means residents. If someone is approved as low-means and the facility has a bed on this basis, the accommodation charge will depend on a Centrelink means-test calculation and the government will pay additional subsidies on their behalf.
Anyone in need of residential or government-subsidised home-care packages must first be assessed by an aged care assessment team via the myagedcare.gov.au website.
An age pensioner with less than $46,000 in assets is subsided in aged care by the government. They will not have to pay a RAD and only have to pay a basic daily care fee, currently $47.86 per day.
Where a person has assets between $46,000 and $157,987.20 they will be classified as being a low-means resident and will be assessed to pay either a Daily Accommodation Contribution or a lump sum Refundable Accommodation Contribution or a combination of both.
According to Affinity Aged Care adviser Donald Swanborough, the DAC will not exceed the means-tested amount which, just to add to the confusion, depends on the status of the facility the resident goes into.
The means-tested amount for a for new or significantly refurbished facilities is $53.84 per day or $35.08 per day for standard facilities.
With Commonwealth-funded aged care, we can feel secure knowing that those residents with limited means receive the same care as other residents who are better off financially,” says Denise Tomaras, Equity Trustees national manager, Aged Care Solutions.
“Clinical care in most of our funded homes is fairly standardised and not dependent upon a person’s ability to pay a full RAD. However, companion rooms or twin share is often a reality for low RAD payers.”
* Not her real name