Aged Care

What is Aged Care? 

Aged care is the living and nursing care services for older Australians who can no longer live independently or need help to stay in their homes. These services include both residential aged care in nursing home and home care services.

Nursing homes (aged care homes) provide three kinds of care: 

Home care includes two types of government-funded services for people living at home: the Commonwealth Home Support Program, which offers some help with daily tasks; and the Home Care Packages Program, which can provide a greater range of services.

The Aged Care System 

The aged care system in Australia is the responsibility of the Commonwealth Government under the Department of Health. The Government provides the funding to support aged care services, regulates the costs and accreditation for nursing homes and oversee legislation for aged care.

In 2012, the Commonwealth began a 10-year plan to reform the aged care system and ensure it stays workable and affordable as our population ages.

These changes mean you must now contribute to the cost of your aged care. Since July 2014, nursing home residents need to pay the following fees:

  • A basic daily fee
  • A means-tested care fee
  • An accommodation cost with three ways of paying – this is called a Refundable Accommodation Deposit (RAD)
  • Any additional fees if you choose to have extra services that aren’t included in the basic fees and costs

These fees are determined according to your ability to pay. If you have few assets, you will likely only pay for your bed using the Age Pension.

Others will have to pay for the daily fee, which is adjusted based on your wealth; and the Refundable Accommodation Deposit (RAD) which can be paid as a refundable lump sum payment or a non-refundable Daily Accommodation Payment (DAP).

The average RAD is now around $320,000, while the average DAP is now about $60 (based on $300,000 RAD). 

To be approved for a nursing home (aged care home) or home care, you need to register with my aged care, the Federal Government’s aged care service.

You will also need to complete a Government Income and Assets Test and be assessed by an Aged Care Assessment Team (ACAT). This takes some time and means it can be up to 12 weeks before you can access an aged care bed.

With our aged care system almost at capacity, you’re also unlikely to receive the aged care services or nursing home place that you want immediately.

With more people opting to stay longer in their homes, the Federal Government is also encouraging older people to access home care as it costs less and reduces the strain on our aged care system.

This has led them to change the way home care is funded. From February 27, 2017, the Commonwealth is giving residents control of the funding to pay their care so they can decide who they will use – this is known as Consumer Directed Care (CDC).

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A special thanks to our contributors

Jill Donaldson


Jill has been practicing as a clinical physiotherapist for 30 years. For the last 13 years she has worked solely in the Aged Care sector in more than 50 metropolitan and regional facilities. Jill has also toured care facilities in the US and Africa and is a passionate advocate for both the residents in aged care and the staff who care for them. She researches and writes for DCM Media.

Chris Baynes

DCM Media, agedcare101

Chris has been a journalist and publisher in the retirement village and aged care sectors for 11 years. He has visited over 250 retirement villages and 50 aged care facilities both within Australia and internationally. Chris is a regular speaker at industry conferences plus is a frequent radio commentator.

Annie Donaldson

Nurse and Carer

Annie has a long career in both nursing and the media. She has planned and co-ordinated the medical support from both international TV productions and major stadium events. In recent years she has been a primary family carer plus involved in structured carer support.