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New care charges hit the elderly

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Elderly patients assigned a home care package or who move into residential care will be hit with charges of up to $25,000 a year under changes that came into effect last month.

As part of efforts to curb growth in spending on aged care, the Federal Government has stipulated that from now on the elderly will have to make an increased contribution of up to $60,000 toward the cost of their care.

Under the changes, people receiving a home care package will be charged a basic daily fee equivalent to 17.5 per cent of the single Age Pension, while those whose annual income exceeds either the single or couple pension rate (respectively $24,731.20 or $38,344.80 as at March 2014) are now subject to an additional “income-tested care fee”.

To help soften the financial blow, the Government has capped the income-tested care fee for part-pensioners at $5000 a year, and $10,000 a year for self-funded retirees, and has set a lifetime limit on fees paid of $60,000.

Those moving into residential care are liable, at the very least, for a basic fee set at 85 per cent of single Age Pension. Depending on their income, they may also be charged a means-tested care fee, an accommodation payment and an extra charge for upgrades such as a higher standard of accommodation, hairdressing services, pay television or other extras.

For those in residential care, the Government has set an annual cap of $25,000 on the means-tested fee, and no-one will be required to pay more than $60,000 in their lifetime.

The changes are controversial and have been hotly contested by seniors groups and aged care advocates.

 The Government sought to provide some comfort for those expecting to move into residential care by announcing that the family home would continue to be exempted from aged care assets test “if occupied by a spouse or other protected person”.

In addition, it said the changes would not affect people who were already receive home care or who were in residential care when the measures came into effect on 1 July.

“If you are already in residential care or home care, you will continue with your current financial arrangements, unless you leave and re-enter after 28 days of unapproved leave,” the Department of Human Services said.

More information can be obtained by calling 1800 200 422 or visiting myagedcarae.gov.au

Adrian Rollins