21 July 2015

Aged Care Common Terminology Explained

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Aged care can be a difficult transition for any family member and a difficult decision to make.

There are a number of aged care terms that you need to understand which are explained below.

1. Aged care assessment

To enter government subsidised residential care you must first be assessed by an Aged Care Assessment Team (ACAT). The assessment will also determine your eligibility for respite or a home care package.

2. Accommodation payment

Aged care facilities set the prices they charge for accommodation in different types of rooms. Together with a description of the key features of each different room type, the facility must publish those prices and show the payment options.

Residents have a choice as to how they pay for their accommodation – either as a lump sum called a Refundable Accommodation Deposit (RAD), a periodic payment called a Daily Accommodation Payment (DAP), or a combination of both.

3. Daily care fee

A fee paid by all residents and represents 85% of the full single age pension.

4. Means tested care fee

This means-tested fee captures both income and assets.

For new residents, both their income and assets are used to determine a ‘relevant means-tested amount’.

An annual cap of $25,000 (indexed) applies to the means-tested care fee to protect residents with higher than average care fees. A lifetime cap of $60,000 (indexed) protects all residents who receive care for a longer than average period of time.

Fees for extra or additional optional services

Additional fees may apply if you choose a higher standard of accommodation or additional services. These vary from home to home. Your aged care provider can give you details of these services, such as hairdressing and cable tv, and the fees that apply.

Verante Pty Ltd is a Corporate Authorised Representative of Viridian Select Pty Ltd, ABN 41 621 447 345, AFSL 515762. This information has been prepared without taking account of your objectives, financial situation or needs. Because of this you should, before acting on this information consider its appropriateness, having regard to your objectives, financial situation and needs.