The conversations of life

We will all be paying more to move into aged care homes within years


I don’t know if you have noticed but there is increasing conversation in the aged care world that it is at breaking point financially.

Staff are asking why they are amongst the lowest paid in the country. 25% of aged care homes run at a loss.

We, the customer, are demanding better food, better services, hotel style bedrooms with ensuite bathrooms.

Gov. pays $13B a year

But the major source of money is the government they don’t want to or can’t pay more than the $13 billion a year they are now and the 5% increase a year they have committed to just keeps up with the growing number older people.

The aged care bureaucrats recognise the only way is for with a customer to be paying more.

We have to pay more

Last month the senior bureaucrat David Tune gave his report to government recommending the maximum bond to be charged without special government approval be increased from $550,000-$750,000 (“in line with growing house prices”).

He also recommended abolishing the maximum amount (the cap) we each have to pay for means tested aged care, currently $63,759.75.

After the next election?

The Federal government did not accept either of these recommendations, leaving things as they are. There must be an election around the corner!

The political reality is both sides of government agree to work together on aged care – neither want to make it a big issue because both of them know that when they are in power it will be a financial headache.

When either party wins the next election and has three years in front of them they can make the decision that we can all pay more.

Comppulsory aged care insuranace in Japan

It will happen, most probably in small increases. If you are 20 years away from an aged care home think how much you will be required to contribute by then.

Perhaps we should be like Japan where aged care insurance is compulsory. Read about it HERE.

Picture: Japan Times

Chris Baynes is a columnist and publisher of Frank & Earnest. He is also the publisher of, the leading national directory of retirement villages and aged care services in Australia.

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