My parent’s aged care fees seem to keep changing. What causes this, and how can I make sure they’re paying the right amount?
It’s understandable to feel concerned when aged care fees change. Navigating these costs can be stressful, especially when they fluctuate. Here’s a clear explanation of what might cause these changes and how you can ensure your parent is being charged the correct amount.
Why Do Aged Care Fees Change?
Your parent’s fees can increase, decrease, or stay the same due to several factors, including:
- Personal and Financial Circumstances:
Changes in your parent’s income, assets, marital status, or living situation (e.g., a dependent child moving out) can affect the fees they are required to pay. - Care Needs:
If their care needs increase or decrease, this can impact the cost of their services. - Regular Indexation:
Fees set by the government are adjusted twice a year (on 20 March and 20 September) to keep up with inflation and changes to the cost of living. - Annual and Lifetime Caps:
There are limits on how much your parent can be charged for certain fees. Once these caps are reached, they won’t have to pay more for that year or over their lifetime.
Key Types of Aged Care Fees
- For Home Care Packages:
- Income Tested Care Fees: These fees depend on your parent’s income and are capped annually and over a lifetime.
- Annual Caps:
- Up to $6,834.77 per year for incomes at or below $65,020.80.
- Up to $13,669.63 per year for incomes above $65,020.80.
- Lifetime Cap: $82,018.15 (indexed regularly).
- Annual Caps:
- Income Tested Care Fees: These fees depend on your parent’s income and are capped annually and over a lifetime.
- For Aged Care Homes:
- Means Tested Care Fees: These fees are based on a means assessment and capped annually and over a lifetime.
- Annual Cap: $34,174.16 per year.
- Lifetime Cap: $82,018.15 (includes any income tested care fees paid while receiving home care).
- Means Tested Care Fees: These fees are based on a means assessment and capped annually and over a lifetime.
How to Report Changes
To ensure accurate fees, make sure your parent (or their nominee) reports changes in their circumstances to Services Australia or the Department of Veterans’ Affairs (DVA). This includes changes in:
- Marital status
- Income and assets
- Accommodation deposits (if applicable)
Prompt reporting helps avoid being overcharged or undercharged.
What Happens When the Caps are Met?
- Annual Cap: If your parent reaches the annual cap, they won’t have to pay more for that year. Payments will resume on the anniversary of when they started receiving care.
- Lifetime Cap: Once the lifetime cap is reached, they won’t have to pay any more income tested or means tested care fees.
How Will You Be Notified of Fee Changes?
If your parent’s fees change, Services Australia will notify both them (or their nominee) and the aged care provider by letter. The letter will explain the changes and the date they took effect. Providers will also notify you if there are changes to basic daily fees.
Regular Reviews
Services Australia conducts regular reviews, usually monthly, to ensure the fees are accurate based on any updated personal or financial information. They also adjust fees with government-set changes in March, July, and September.
What if You Overpaid?
If the fee changes apply to a past date and your parent has overpaid, the provider will issue a refund for the overpaid amount. If there are discrepancies, the provider can clarify and make adjustments accordingly.
Supporting Your Parent
Staying informed and proactive will help ensure your parent’s fees are correct and manageable. Don’t hesitate to reach out to Services Australia or your parent’s aged care provider for clarity and assistance. Remember, you’re not alone in this — help is available to guide you through these financial complexities.
