The new Aged Care Act aims to make aged care funding fairer and more sustainable.
From 1 November 2025:
- Approximately half of the people entering residential aged care will pay more
- The assets means test stays the same, but the types of contributions residents make and how they are calculated will change. New taper rates will mean gradual increases in resident contributions as income rises.
- People who cannot afford to pay more will continue to only pay the basic daily fee
- Providers and self-funded retirees will have new mandatory reporting requirements on their personal and financial circumstances.
If you are a permanent resident on 30 October 2025, your fee arrangements will not change. You can opt into the new rules, but ensure you seek advice before switching.
You can use this calculator to estimate your total daily fee, including your fee post 1 November 2025. The calculator does not estimate your accommodation costs if you have to pay these, as they depend on the residential home you are entering.
Under the new system, the Government fully funds clinical costs such as nursing.
The current means-tested care fee will be abolished. The new daily fee is made up of a:
- Basic daily fee that everybody pays
- Means-tested hotelling supplement contribution – previously fully paid by the government. The maximum you’ll pay is $12.55, indexed twice each year. There is a lifetime cap for this payment.
- New means-tested non-clinical care contribution which includes costs such as bathing, mobility assistance and provision of lifestyle activities. The maximum you can be asked to pay is $101.16 a day. There is also a lifetime cap for this payment.
- There will be some changes to accommodation costs from 1 November 2025:
- Service providers are required to retain 2% per annum of the balance of the refundable accommodation deposit. The amount will be debited monthly.
- For residents who pay accommodation costs as a daily payment, this payment will be indexed twice a year. This does not apply to people who are paying a partial accommodation contribution whose payments are already indexed.
For more information, you can listen to this webinar or read a summary of the changes here.
Resources for Aged Care participants
- Upcoming changes to aged care funding - Summary
- Income and means assessments
- Fees and Charges for Residential and Home Care
- Fee estimator: How much will I pay?
- Understanding aged care home accommodation costs
- Webinar-Residential care fees and means testing
- Webinar slides – new income and asset tested taper amounts – slide 21
