Permanent Care
Funding arrangements for residential aged care is according to the Aged Care Act and relevant principles.
The cost of accommodation and care is subsidised by the government, with residents contributing according to a combined income and asset assessment conducted by the Department of Human Services (Centrelink).
The maximum amounts residents can be asked to pay are regulated by the Government. There are protections in place to ensure that care is affordable for all Australians and that no-one is denied care due to the inability to pay.
The basic daily fee ($66.8 or or $24,382 per year)
- All residents are asked to pay this fee which covers meals, cleaning, laundry, utilities. This is set at 85% of the single person rate of the basic age pension and maybe the only fee you are required to pay.
- When you enter an aged care home a letter is provided by the Department of Human Services confirming your basic daily fee.
- The basic daily fee is paid monthly one month in advance.
A means tested care fee
If the government determines that you are able to contribute towards the costs of your care, you’ll be asked to pay these fees. Services Australia will advise the fee type and amount for each resident based on your residential aged care means assessment.
Means Tested Contributions that may apply to new aged care residents from 1 Nov 2025:
- Hotelling Supplement Contribution
This supplement covers daily living expenses such as cleaning, meals, and laundry — over and above the basic daily fee.
- Non-Clinical Care Contribution
This contribution covers non-clinical services such as bathing, mobility assistance and lifestyle activities. There is a maximum daily cap on this contribution.
There are different terms used for deposits and daily payments depending upon whether you are partly supported by the Government or paying your accommodation payment in full.
If you are not assisted by Government and are paying for all of your accommodation costs the terms used are:
- RAD (Refundable Accommodation Deposit) which refers to a lump sum payment to cover the accommodation costs. It is refundable when they leave care.
- RAD/RAC retention applies to everyone who first enters residential aged care on or after 1 November 2025 and pays by refundable deposit (RAD or RAC) in full or in part. Under this arrangement, providers will keep a small portion of each new RAD or RAC. The amount retained is calculated at a rate of 2% per annum. This rate is applied to the daily RAD or RAC balance, with the amount deducted regularly. After 5 years, no more retention amounts will be deducted. This is to protect residents who remain in care for a long time.
- DAP (Daily Accommodation Payment) which refers to a daily payment which is made on a regular basis, up to a month in advance, similar to paying rent. It is not refunded when the resident leaves. You can choose to pay a RAD or DAP or a combination payment RAD/DAP
- Combination (An apportioned combination of the RAD and DAP payment options.)
Extra / Additional Optional Services Fee
You can also choose to pay for a higher standard of accommodation and or additional optional services. These services include private telephone, streaming television, drinks and meal options. Pricing is available on request.
Superior Room:
Room size: 22sqm
Features:
Spacious single room with private ensuite
King single bed
The maximum price that you can be charged for this room is a refundable deposit of $530,000.00 or daily payments of $ 110.50 or a combination of both. (Note: This is the base calculation, before applying RAD and RAC retention deductions or DAP indexation.)
Deluxe Room:
Room Size: 28sqm
Features:
Ultra spacious single room with private ensuite
King single bed
The maximum price that you can be charged for this room is a refundable deposit of $600,000.00 or daily payments of $ 125.10 or a combination of both. (Note: This is the base calculation, before applying RAD and RAC retention deductions or DAP indexation.)
Residents can choose to pay for their accommodation by a refundable deposit, a daily payment, or a combination of both.
- RAD- A refundable deposit is paid as a lump sum amount. From 1 November 2025, RAD and RAC retention will apply for eligible residents. These amounts are non-refundable and reduce the maximum RAD a provider can hold.
- DAP- A daily payment accrues daily and is paid periodically, for example monthly.
- A combination payment includes both a partial lump sum and daily payments.
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