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Aged Care Funding Changes Explained in Plain English (Part 3)

Part 3: Changes to In-Home Care Funding


The Australian government has made significant changes to the way they will fund aged care beginning July 1, 2014. In this three-part series, we explain the changes and how they may affect you and your loved ones.

The first two articles in the series addressed changes to the way new aged care residents will pay for their care. This article will address changes to the funding of in-home care only.

The Australian in-home care system is designed to keep an elderly person in their home environment for as long as possible. On August 1, 2013, the old three-package system of in-home care funding was abolished and a new four-level system was introduced. This includes:

Level 1: Basic care needs

Level 2: Low level care needs

Level 3: Immediate level care needs

Level 4: High level care needs

Most of this in-home care is government funded, though a co-contribution does exist, determined by the following formula:

  • If you are on maximum basic rate of pension, your co-contribution cannot exceed 17.5% of the maximum basic pension (so current max fee is $3485 per year)

  • If you have an income higher than the maximum basic pension, your fee may be up to 50% of your income above the maximum basic pension.

Currently, a limited number of home care providers are ‘consumer directed’. This means that the client controls the care that they receive, how it is provided and how their care budget is used.

As of July 1, 2015, all home care providers will move to consumer directed care. With this in mind, here are some tips for families with loved ones considering home care:

  • Review the individualised budget of the home care provider. Does it allocate enough money to the main priorities for your loved one?

  • Follow your intuition. If you notice something is missing, make sure you can see money and time allocated to it in the care plan and care budget.

  • Be an active consumer: Ask questions about why and how certain care is provided.

  • Set regular review dates. Care needs can change gradually and this may make changes less obvious to you or the caregiver.

  • Ask: Is the home care provider level allocated appropriate or does it need to be elevated?

  • If you are unhappy, investigate other provider options.

While the new funding changes may take some time for both providers and consumers to get used to, a move to consumer directed in home care puts more control in your hands, and allows you to choose the most individually appropriate aged care services for your loved one.

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