The idea of moving into residential aged care is not a popular choice for most people and whilst for many it may be the best option for their care, realistically the idea of leaving their home and going to a nursing home is not the preferred option. Currently, many people wait until it may be too late to apply for home care i.e., after they have had a fall or stroke and are currently in hospital. So applying for home care before you need it is the key!
If people want to stay at home longer, it is all about being able to afford it, preparing for home care and changing the mindset that a lot of people have about the financial aspect of home care.

When it comes to care at home, there are 2 major choices;
1. Government subsidised home care and/or
2. Private home care (i.e. the Government does NOT subsidise this care)

1. Government subsidised home care

Government Home Care is subject to an income assessment (i.e. the income you earn from your all sources).

There are two different types of fees to pay;

Basic Care Fee – This ranges from $4,095pa to $4,573pa depending on the level of care package you have been assessed for. While it is not compulsory to pay this fee, if you choose to pay it, then you get more services, if you choose not to pay it, then simply you have less services available.

Income Tested Fee – Not all home care recipients pay this fee, it is subject to the outcome of the income assessment. If you are assessed for an Income Tested Fee then it is compulsory to pay this fee. The government use the income test to then reduce the amount they will subsidise your home care. Those who receive the full Age Pension will not be charged this fee, however Part Pensioners may have to pay it and self funded retirees will definitely have to pay an income tested fee. The current range of the Income Tested Fee is from Nil to $13,121pa

However, Government subsidised home care requires being put into the National Queue until the Government funds your package, which could be a wait of between 3 months to 2 years in previous cases.

It is worthwhile noting that any income tested fee that you pay will also count towards your Means Tested Fee life time limits in residential aged care.

So, what happens if you need home care whilst waiting, or the current home care level of subsidy you receive is not enough? That’s when you should consider Private Home Care.

2. Private home care

Private home care does not require an Income Test because the government is not subsidising it, which means care support can be available immediately. This means you can use private home care whilst you are waiting for the Government subsidised package to come through OR if you need more home care than the subsidised package delivers. Therefore, this might keep you out of aged care longer by being able to be supported with additional care at home.
However, with Private home care you have to pay the entire cost of that care, which many people don’t want to pay. This is where the change of mindset might help, as whilst it may cost you money, if you are trying to stay out of residential aged care, isn’t that worth it? If you did have to move into aged care, it could be just as expensive or it may even cost much more depending on the aged care facility you choose.

We are seeing a lot more people use their government home care package and top it up with private care, and usually once we conduct the financial modelling we can find when will be the time that it is cheaper to move into residential aged care.
Talking to an expert like Balance about funding private home care instead of or as well as subsidised home care, just may deliver your objective of staying home for longer, while also comparing home care managed care options versus self managed care options could result in more funds being used for care instead of administration.