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    Posted December 27, 2018

    Understanding Basic Aged Care Costs and Fees

    Making a decision to move to an aged care facility can be a difficult one, especially when it comes to the financial aspects of it. So, here’s a simple overview of the basic costs and fees associated with moving to an aged care facility so that you can make an informed choice.

    Basic daily fee

    The basic daily fee covers your daily living costs such as meals, cleaning, utilities, and laundry. All residents pays this fee and is roughly equivalent to 85% of an entire single pension. The government sets the basic daily fee which is adjusted twice a year in March and September.

    Accommodation costs

    Some people will have their accommodations costs subsided by the Australian Government, while others will need to pay the accommodation price agreed with the aged care facility. There are several ways to pay for your accommodation, such as a lump sum (also known as a Refundable Accommodation Deposit or RAD), a daily fee, or a combination of both.

    Depending on your income level, the government can assist with your aged care accommodation costs. There are three levels of support:

    Non-supported: The government does not assist with the cost of your accommodation.

    Partially supported: The government will cover a certain part of the cost of your accommodation.

    Fully supported: The government covers all costs of your accommodation.

    Means tested care fee

    Depending on your income and assets, you may be asked to pay a Means Tested Care Fee. This is a contribution towards the cost of your care. A comprehensive assessment of your income and assets by The Department of Human Services or Department of Verteran affairs will determine if you need to pay this fee. This is a daily fee which is subject to annual and lifetime caps.  The capped amount is $26,381 per year or $63,313 over your lifetime.

    Extra or additional fees

    Some aged care facilities may ask you to pay extra if you wish to upgrade your accommodation or have available additional services. These additional services are those services provided above the minimum requirement under the Aged Care Act.


    As with any big life decision, it’s important that you do your research, look at options carefully, and ask questions. Discuss any accommodation and extra fees with your aged care facility before you sign a contract. If you’re planning to seek government assistance, you need to schedule a formal income and assets assessment by the Department of Human Services (DHS). This will allow you to get an idea of what your contribution for accommodation, care and services will be. If you’re a veteran, a formal income and assets assessment can be performed by the Department of Veterans’ Affairs.

    Finally, we strongly advise you see an independent financial advisor with experience in aged care who will be able to answer your financial questions based on your individual situation.

    If you have questions about aged care service fees or are looking for an aged care facility, please feel free to contact the team at Village Glen at 1300 VILL GLEN (1300 8455 4536). Village Glen offers aged care services in both Mornington and Capel Sound. Over the years, Village Glen has earned the trust of many families who’ve placed their loved one’s security, care and well-being in our hands.