does the govt pay the difference between the forfeited amount (85% of pension) and the amount a self-funded client pays
Residential aged care (so called Nursing homes = NH) are funded through several streams
The government has determined all
services that a NH might be required to provide.
Nursing homes are a misnomer actually as there the workers there are mainly Carers. The RN is usually only one person per shift.
In short the costs of a NH are:
Accomodation - the building/room/ ensuites - the capital cost of providing an aged care "residence"
Clinical care - the actual nursing care relating to health
Non clinical care - mobility/ personal hygiene/ social/ recreational activities
Meals/cleaning/laundry/heating/facility maintenance
The AusGoV provides funding through:
1)The
AN-ACC funding Model which calculates the
clinical and
non clinical needs of every resident irrespective of financial means.
AN-ACC = Australian National Aged Care Classification
2) Supplements
- for specialised individual needs such as specialised, wound dressings, tube feeding, etc
-
Hoteling supplement- include everyday services such as catering, cleaning, laundry.
- Supplements are also provided to the NH if a resident is deemed by Services Australia to not have the means to fully pay the Residential accomodation deposit (RAD)
3)Capital grants
Residents of means also provide funding to the NH through:
All prospective NH residents should get a Service Australia
mean assessment of their income and assets
Of course it is not compulsory to undertake this assessment. However a non assessed prospective resident will have to pay the full price
From the Means Assessment, Services Australia determine the amount payable by the individual prospective resident for:
1) Accomodation payments
- payable through a one off Residential accomodation Deposit (RAD) , or Daily accomodation payment (DAP ) if the resident does not have the lump sum.
- These payments are highly regulated by the AusGov with RAD amounts in excess of $750K requiring approval from the
IHACPA (Independent Health and Aged Care Pricing Authority). However it is common these days for the RAD to be nearly $1M depending on location.
2)
Means tested fees which has 2 components
(a) Hoteling contribution -this is supposed to contribute toward the Hoteling supplement that the Govt pays. Daily cap but no lifetime cap
(b) Non clinical contribution - this is supposed to contribute toward the non clinical component of the AN-ACC funding. Annual and lifetime cap of 4 years applies
3) The Basic daily fee
- which everyone pays regardless of means
- capped at 85% of the aged pension.
Summary
Basically those with no means will only pay the basic daily fee.
Those with means will pay the basic daily fee + proportionately according to their means, the accomodation payment and means test fees.
Some would say there is a subsidy from the Residents with means, to the residents without means - because some pay more and some pay less and the extent that the Goverment does not have to fully fund 100% of residential aged care means that some residents are assisting the government to cover the costs of those without means.
There are safeguared for those who are of low means:
(1) Residential Aged Care providers are required to maintain a certain % of supported residents in their facilities.
- Some would suggest this is evidence that there is some amount of cross subsidy.
(2) Admission to a NH is still based on clinical need.
(3) The Aged Care Act prohibits discrimination on basis of financial means.
While these guardrails exist, I think those with means might get in faster.
Like my father. He still drives his car and he applied and got in with no waiting list, though I would class him as borderline.
Additionally, the Self funded have an advantage is a greater selection of accomodation types including single rooms.
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