General advice warning:
The information in this update is of a general advice nature only and has been prepared without taking into account your personal objectives, financial situation or needs. Because of that, you should, before acting on the advice, consider the appropriateness of the advice, having regard to those things and seek advice and assistance from a qualified financial adviser.
December Show Troy Theobald & Belinda Veriton from RFS Advice talk all things aged care related and how to be ready
As we head towards Christmas and 2025 comes to a close, it is a good time for the family to come together.
This can be a good time for some reflection on where you live and is this sustainable into the future.
Yes, a real look into the mirror….
With this in mind I have Benda Veriton, shareholder at RFS Advice and expert in our aged care advice team with me today.
Belinda, there has been some changes in this area in 2025.
Can you talk us through a few of these details. I know you and Greg recorded some podcasts that are now online that have a lot more detail but I would like to ask you a few questions to help the listeners understand these changes.
The following information is a summary of the changes across Home Care and Residential Aged Care, including what’s changed and the new reforms.
We have also included a summary of the key details with Home Care (Part A) and Residential Aged Care (Part B), however encourage people to reach out to the team, if the information raises any questions.
Changes to Home Care & Residential Aged Care
Why plan for care now?
Support at Home program — at a glance (from 1 Nov 2025)
A new Support at Home (SAH) program is proposed to replace the current Home Care Packages and Short-term Restorative Care from 1 Nov 2025. The Commonwealth Home Support Programme (CHSP) will transition later—no earlier than 1 July 2027.
Key reforms:
- New fee-for-service structure: clients pay a set % of each service used, based on service category (clinical / independence / everyday living) and Age Pension status (means testing).
- “No worse off” principle for existing Home Care recipients and people already in the National Priority System. New classification levels (8 ongoing + 2 short-term restorative/end-of-life) with annual budgets.
- Reduced waiting times targeted (average ≤3 months by 1 July 2027).
- Defined list of services with price caps.
- Quarterly budgets with carryover capped at 10% or $1,000 (whichever is greater).
- Separate Assistive Technology and Home Modifications scheme.
Part A — Staying at Home: Support at Home (SAH)
1) How eligibility works
- Get an Aged Care Assessment confirming your eligibility for home support.
- Everyday care is assigned a Level 1–8 package. (Short-term restorative and end-of-life/palliative pathways are separate programs.)
- Once approved, you join the National Queue. When a package is allocated, you’ll receive a referral code—give this to your chosen provider within the timeframe in your letter to avoid losing your place.
- Start your research early via Find a Provider on myagedcare.gov.au and meet with a few providers to compare service fit and availability.
2) What services can be funded?
- Clinical care: nursing and allied health as assessed. Government funds these from your package; your contribution rate for clinical care is 0% (see table below).
- Nonclinical care: two subcategories – “independence” (e.g., transport, personal assistance) and “everyday living” (e.g., meals, cleaning). You may be asked to contribute to these services, with a lifetime cap of $135,318 across non-clinical categories.
3) How your contribution is set
Contribution rates (from 1 Nov 2025)
| Income support payment status | Clinical care | Independence | Everyday living |
|---|---|---|---|
| Full Age Pensioner | 0% | 5% | 17.5% |
| Part Age Pensioner / CSHC holder | 0% | 5%–50% | 17.5%–80% |
| Self funded retiree | 0% | 50% | 80% |
How the percentages are determined
- Your Age Pension status sets your contribution bands: lowest for full pensioners, moderate for part pensioners/CSHC holders, highest for self-funded retirees.
- The Government has indicated these percentage contributions draw on the Age Pension means test (which considers income and assets), differing from the current HCP settings that rely mainly on income.
- Part pensioners will not need a separate aged care means test, as Services Australia already holds relevant data.
- Self-funded retirees who are eligible for the CSHC will pay a lower percentage than those who are not, even if they haven’t yet applied for the card.
4) How package funds flow
- Your package budget is credited quarterly. Unspent funds roll over, capped at 10% of the quarter’s value or $1,000 (whichever is greater).
- Providers can charge administration/coordination—budget for ~10% admin (example below). If your needs exceed what your package can cover, family support or private top-ups may be needed.
Worked example (Level 5 SAH)
- Annual package: $40,000
- Provider admin (10%): $4,000 → $36,000 remains for services
- Illustrative service plan: 10% clinical (e.g., nursing) ≈ $3,600; 60% independence ≈ $21,600; 30% everyday living ≈ $10,800
- Your contributions are applied only to the nonclinical services used, at your assessed percentage (table above), subject to lifetime caps.
Classification levels and budgets — new versus current
| Classification level | New: SAH annual budget | Current: HCP annual budget |
|---|---|---|
| 1 | $10,731 | $10,986 |
| 2 | $16,034 | $19,319 |
| 3 | $21,965 | $42,055 |
| 4 | $29,696 | $63,758 |
| 5 | $39,697 | - |
| 6 | $48,114 | - |
| 7 | $58,148 | - |
| 8 | $78,106 | - |
Shortterm classifications
- Restorative care: up to 12 weeks (+ 4week extension possible) focused on allied health interventions.
- End of life care: up to $25,000 over 16 weeks to support care at home.
Reduced waiting times, defined services & price caps
- Additional funding aims to reduce average SAH wait times to ~3 months by 1 July 2027 (noting current waits for higher HCP levels have been ~12 months).
- A defined, consistent list of services will apply, with price caps that reflect time of day and location factors.
Assistive Technology & Home Modifications scheme
- Operates alongside individual budgets, so you don’t need to “save up” package funds for these items.
- Includes a defined list of eligible supports; home modifications up to $15,000 are allowed (subject to rules).
Case study — “Sally” (Support at Home, class 5)
- Status: Self-funded retiree with CSHC | Income: $99,000 | Home: $750,000 | Other assets: $500,000
- Package: Class 5 — $39,574 per year
- Contributions: Sally pays 42% (≈ $16,611/year); Government pays 58% (≈ $22,963/year).
- Access can include restorative support (12 weeks), assistive tech and home mods, and endoflife support if needed.
Transitions & safeguards — the “No worse off” principle
Who is covered? People who, on 12 September 2024, were:
- receiving a Home Care Package, or
- on the National Priority System, or
- assessed as eligible for a package.
If you later move to residential aged care (on/after 1 Nov 2025): you remain under pre1 July 2025 residential fee rules unless you elect the new rules. (Note: accommodation payment changes still apply.)
Colin raised a very good point about the ability to change providers and how it is possible and can be quite easy. The advice is to look around, do your due diligence and find the right provider. Fortunately, the transparency is high around fees, so you can easily compare fees across providers.
Part B — If Residential Aged Care Becomes Right for You
1) What you pay (the four components)
- Listed prices appear on myagedcare.gov.au or ask providers directly.
- Pay as a lump sum (RAD – Refundable Accommodation Deposit), a daily fee (DAP – Daily Accommodation Payment), or a mix.
- RAD is refundable to you/your estate on exit (less agreed deductions) and government-guaranteed when paid to an approved provider under the Aged Care Act.
- DAP is not refundable; it’s a fee for the right to occupy.
- Strategy tip: A RAD is exempt for Centrelink assets testing (but assessable for aged care fee calculations). Consider cashflow, pension outcomes and estate planning when choosing.
Basic daily fee (living costs):
- Covers meals, cleaning, laundry, heating/cooling, electricity.
- Currently $65.55/day, set at 85% of the single basic Age Pension (before pension supplement) and indexed every March and September.
Meanstested care contribution (nonclinical care):
- Services Australia (or DVA) assesses your income/assets after you enter permanent care; results can take weeks/months.
- If you don’t disclose, you’ll pay maximum daily fees (lifetime caps still apply).
- Fees are recalculated monthly—advise Services Australia of any changes (income, assets, RAD payments, changes in home occupancy) to keep fees accurate.
Higher Everyday Living Fees (HELF):
- From 1 July 2025, former “additional services fees” are renamed HELF.
- Provider specific extras (user pays or bundled). Request the menu of services and all inclusions/exclusions in writing.
2) RAD vs DAP — paying for your room
- RAD (lump sum): lowers ongoing fees; refundable; affects aged care means testing but not Centrelink assets; reduces liquid assets.
- DAP (daily): preserves capital; higher ongoing cost; nonrefundable.
- Mix: a balanced approach—pay part RAD to reduce DAP; revisit as circumstances change.
Christmas is a time we come together
With Christmas being a time when families come together, and as Troy mentioned, this can be a good time for some reflection on where you live and is this sustainable into the future.
Yes, a real look into the mirror….
It’s also a time to think about your loved ones and see how they are travelling. The following provides further detail on the conversation from the show.
Starting the Conversation – Recognising the Need
What are some of the early signs that it might be time to start thinking about residential aged care?
Early signs often relate to safety, health, and wellbeing. These can include frequent falls, poor hygiene, difficulties managing medication, increased confusion or memory loss, loneliness, or struggles with daily tasks like cooking and cleaning. You may also notice more frequent trips to hospital or a decline in mobility. Recognising these signs early allows families to explore care options before a crisis forces rushed decisions.How can families approach that often difficult conversation — especially when a parent or loved one is resistant to the idea?
Gentle, compassionate conversations over time work best — not a single moment of pressure. Focus on their goals: staying safe, maintaining independence, and improving quality of life. Listen to their concerns and fears, involve trusted professionals (like their GP or adviser), and highlight that exploring aged-care options doesn’t mean an immediate move. It’s about planning ahead and keeping control, rather than waiting until someone else must decide for them.
Are there intermediate options people should consider first, like home care or respite care?
Absolutely. Many people start with home-care support — such as help with shopping, housework, transport, or personal care — so they can remain at home safely for longer. Short-term respite care can provide a break for family carers or help someone trial a residential environment before making a long-term decision. These options give flexibility and support while ensuring the person’s needs are being met.
Preparing Emotionally and Practically for the Move – Client Answers
What can families do to make the transition to aged care smoother for their loved one?
Families can help by involving their loved one in decisions wherever possible and by allowing plenty of time to prepare. Bringing familiar belongings — favourite photos, a comfy chair, treasured items — can make the new room feel like home. It also helps to build relationships early with staff and participate in welcome activities. Most importantly, open and honest communication gives the person a sense of control and comfort during the change.
How can residents and families maintain a sense of independence and dignity after moving in?
Maintaining routine, preferences, and personal choices is key. Encourage your loved one to continue making decisions about their daily life — what they wear, how they spend their time, and how they manage their finances. Choosing activities that bring joy and purpose, staying socially connected, and treating aged-care staff as partners in care helps support dignity and independence.
What are some ways families can stay involved and supportive — without feeling overwhelmed or guilty?
It’s okay to set healthy boundaries and share responsibilities within the family. Regular visits, phone calls, and involvement in care-planning meetings show love and advocacy, even if you can’t be there every day. Many families find comfort in knowing trained professionals are providing 24/7 support — you’re not stepping back, you’re stepping into a new supportive role.
How do people typically cope emotionally with the change — and what kind of support is available during that adjustment period?
It’s normal to feel a mix of emotions — sadness, relief, guilt, or even stress — during the transition. Residents also go through an adjustment period as they find their place in a new community. Support is available from facility staff, social workers, GPs, psychologists, and counsellors. Community groups and family support networks can also make a significant difference. The important thing is recognising feelings early and seeking help when needed.
Issues & Considerations – Client Discussion Points
Do you choose a facility close to your home, or one closer to relatives so they can visit more often?
There’s no right answer — it’s about balance. Proximity to family often increases social connection, which improves wellbeing. But choosing a location close to existing routines, familiar medical providers, or community groups may reduce disruption. Consider what will lead to the best quality of life day-to-day.
Are you prepared to spend more for higher-quality accommodation and care, given this is your life savings?
Aged care is ultimately an investment in quality of life, safety, and comfort. Many people feel peace of mind knowing they have access to better facilities or more personalised services. We can run the numbers together so you feel confident about affordability and sustainability.
Do you want to stay at home as long as possible — and ensure you’re the one making the decision about when to move?
Most people prefer home care for as long as it’s safe and sustainable. However, planning ahead gives you control. Without a plan, decisions may be rushed or made by others in a crisis. Having a clear strategy allows you to choose the right time and the right setting.
If you are a couple, would you prefer to move together earlier — or leave the decision until one person needs care?
Some couples choose to transition earlier so they can support each other through the change. Others wait until care needs become clearer, knowing that the surviving partner may ultimately navigate the move alone. It’s important to talk openly about your wishes and what would feel right for each of you.
Final comments
A couple of key points Belinda and Troy want to leave us with is the importance of having the conversations early and being prepared. By having real conversations sooner, people are able to make decisions with greater clarity leading to better solutions.
This is a complex and emotionally charged time, so we urge people to get expert advice. Belinda and her RFS Care Advice team are only too happy to answer any questions and help people through this time. This is what we do!!
