Introduction: Aged care

Despite significant changes to the way fees are calculated within the aged care Industry, providers remain obligated to ensure the same level of care is delivered; that pricing and the terms under which a resident is housed and cared for remain transparent and that the recipient’s best Interests are put first for the remainder of their life.

Key legislation and bodies

There are four kinds of funded care provided under the umbrella of aged care:

residential care;

home care (formerly known as community care) packages;

home care support (in some states);

flexible care.

The rights and entitlements of people who receive Australian Government-subsidised aged care services, and the responsibilities of providers of those services, are set out in the Aged Care Act 1997 (Cth) (“Aged Care Act”), the Aged Care (Transitional Provisions) Act 1997 (Cth) and subordinate legislation, the Aged Care Principles (“Principles”).

State legislation covers other forms of supported accommodation such as supported residential services – the Supported Residential Services (Private Proprietors) Act 2010 (Vic) (“SRS Act”) and Supported Residential Services (Private Proprietors) Regulations 2012 (Vic) – and retirement villages (the Retirement Villages Act 1986 (Vic) (“RV Act”)).

Australian Government-subsidised aged-care services are provided to older people in need of personal care/nursing care who are living in their own home or in a residential aged-care service. There is also a small group of younger people with disabilities living in government-subsidised residential aged-care services. The aged-care program is administered by the Australian Government Department of Health.

In addition, there are other independent bodies that regulate aspects of aged care. They include:

the Australian Aged Care Quality Agency (“the Quality Agency”) (formerly the Aged Care Standards and Accreditation Agency) that accredits those residential care services that meet the prescribed standards of care;

the Aged Care Financing Authority (ACFA) has been established to provide transparent, independent, advice to the government on funding and financing issues in aged care. It is informed by consultation with consumers and the aged-care and finance sectors; and

the Australian Aged Care Complaints Commissioner, undertakes:

the approval of extra service fees;

the approval of proposed accommodation payments that are higher than the maximum amount determined by the minister; and

any other functions conferred on the Australian Aged Care Pricing Commissioner by the minister or under federal law.

In addition, many of the provisions in the Aged Care Act that govern subsidies and funding for aged-care services are linked to provisions in the Social Security Act 1991 (Cth).

Significant changes to aged care from 1 July 2014

A number of changes to the provision of aged care came into effect from 1 July 2014 for new entrants to the aged-care system. The arrangements for individuals receiving aged care before 1 July 2014 have not changed. The changes for new entrants apply to the way in which fees and charges for new recipients of aged-care services are calculated. They have not necessarily changed the amount of fees and charges to be paid.

People entering aged care with low incomes and low asset levels receive the same level of care that they would have received under the pre-1 July 2014 system. The fees and charges paid by residents who were already in aged care as at 1 July 2014 continue without any significant change. After 1 July 2014:

There is a single level of residential aged care. There are no different rules for “high care” and “low care”.

Residents receive appropriate levels of care, depending on their needs. Funding and care services are based on an assessment of each person’s needs using the Australian Government’s Aged Care Funding Instrument (see

However, the Aged Care Act still retains many of the provisions governing the use and refund of accommodation bonds for those people who were already in aged-care services before 1 July 2014. The provisions governing the refunding of an “old” accommodation bonds are referred to in the sections of the Aged Care Act governing “refundable deposits” in division 52P. Further provisions are contained in the Aged Care (Transitional Provisions) Act 1997 (Cth). All entrants to subsidised aged-care services are subject to an income and assets test to determine whether or not they are required to pay a contribution to their accommodation or home care.

People who have assets or income over the thresholds at which the fees come into effect can make payments either by a lump sum or a combination of daily accommodation fees. If a person pays a lump sum, a proportion may be refundable, depending on their circumstances.

People who do not have any assets or income may not be required to make an additional contribution.

Residents who entered into residential care before 1 July 2014 are not be subject to the new fees and remain on the “old fee system”.

The Aged Care Act governs both the old fee system and the new fee system.

The provisions of the Aged Care Act that remain the same are those governing:

quality of aged-care services;

approval and accreditation of providers; and

assessment for eligibility to subsidised residential and home care.

Accessing aged-care services after 1 July 2015

The Australian Government has introduced a new way to access aged-care services on a national level in some states. This new system is called the My Aged Care Regional Assessment Service (RAS).

In Victoria, the introduction of the RAS is happening in stages. An individual, or their carer, can obtain the right information from the My Aged Care RAS contact centre and existing state-based aged-care services. SeeFurther information”.

Whether the person lives in an area where the changes have been introduced or not, services (e.g. transport, social support, domestic assistance, personal care, home maintenance, meals, home modification, nursing care and flexible respite services) will still be available to them either through the Home and Community Care Program (HACC) or through a home care package.

(In some states, the Home and Community Care Program will be called the Commonwealth Home Support Program (CHSP).)

From July 2015, Victorians seeking access to services for the first time can contact the My Aged Care contact centre or existing state-based services. The My Aged Care staff can assist them or refer them to the right service.

If the My Aged Care centre is in place in the person’s locality, the staff will:

discuss their aged care needs and determine the appropriate next steps for them:

this may involve providing information about aged care or referring them for either a home support assessment (conducted by the RAS) or a comprehensive assessment (conducted by an existing Aged Care Assessment Team); and

create a client record for the person:

the client record will enable appropriate sharing of personal information with the person, their representatives, assessors and service providers. The person will be asked to provide permission to share the client record. Sharing this information will decrease the number of times they have to repeat their story.

If the person is referred to a RAS, the RAS will contact them to arrange the assessment. During the home support assessment, the RAS assessor will work to develop a support plan that reflects their aged-care needs, goals and preferences. The support plan forms part of the client record that can be viewed online via the My Aged Care client portal.

If the person does not live in a RAS locality, they will be referred to the right place to obtain home support services.

Further information

Further information about the changes can be found at the Department of Health’s website at

Further information about the Australian Government’s subsidised aged care can be obtained from:

My Aged Care:;

the Aged Care information helpdesk: tel: 1800 200 422;

the Department of Health:;

Elder Rights Advocacy: or tel: 9602 3066 or 1800 700 600.


The Aged Care Act applies to the care and fee arrangements of everyone who receives aged-care services irrespective of the time that they started or start to receive services.

The Aged Care Act contains a definition of all recipients of subsidised aged care as “care recipients” irrespective of the type of aged care at home or in a residential service or a combination.

The Aged Care Act provides that anyone who entered a residential care service or any other form of aged care before 1 July 2014 and remains in that care as a “continuing care recipient”. For specific types of aged care, the Aged Care Act refers to “continuing residential care recipients” or “continuing flexible care recipients”.

Many of the provisions of the Aged Care Act remain unchanged except that they now refer to “care recipients” as recipients of aged-care services.

Where the Act differentiates between the two kinds of recipients, the provisions may refer to “a care recipient other than a continuing care recipient”.

The “old fee” arrangements therefore apply to “continuing care recipients” whereas the new fee arrangements apply to “a care recipient other than a continuing care recipient”.

See Dictionary in schedule 1 to the Aged Care Act.