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Information for approved providers of residential aged care homes: Additional services, including ‘capital refurbishment’ type fees

Information for approved providers of residential aged care homes: Additional services, including ‘capital refurbishment’ type fees

The department is aware that a number of providers have charged or are proposing to charge fees for additional services, including ‘capital refurbishment fees’ or ‘asset replacement contributions’ to residents. This information has been prepared to assist providers to understand their responsibilities when charging such fees.

This information does not constitute legal advice. Approved providers should seek their own independent advice.

Legislative context

The Aged Care Act 1997 (the Act) and the Aged Care (Transitional Provisions) Act 1997 (the Transitional Provisions Act) regulate the amount of fees that aged care providers can charge to residents. Relevant provisions are found in Division 52C and Division 56 of the Act and Division 58 and Division 57 of the Transitional Provisions Act.

These provisions require that fees charged for, or in connection with, residential care, or for care and services specified in the Quality of Care Principles 2014 (the Principles) cannot exceed the maximum calculated under Division 52C of the Act and Division 58 of the Transitional Provisions Act. Fees charged for ‘other care or services’ must be agreed with the resident beforehand and the providers must give the resident an itemised account of the other care or services.

The department considers that these provisions mean that providers are not able to charge fees above the maximum amount worked out under the Act and Transitional Provisions Act for services or activities that are part of the normal operation of an aged care home, or are required to be delivered as part of a provider’s responsibilities. Fees for ‘other care or services’ can also not be charged unless the resident receives a direct benefit or has the capacity to take up or make use of the services.

‘Capital refurbishment fees’

The department considers that ‘capital refurbishment fees’, ‘asset replacement contributions’ and similar fees would not be supported by the legislation where the fee does not provide a direct benefit to the individual or the resident cannot take up or make use of the services, or where the activities or services subject to the fee are part of the normal operation of an aged care home and fall within the scope of specified care and services.

Charging fees for ‘other care and services’

Providers cannot charge additional fees for:

  • items listed in Schedule 1 of the Principles (some exceptions apply for items in Part 3); or
  • other services or activities that would form part of the general operation of the aged care home; or
  • services that are required to be delivered as part of a provider’s responsibilities.

What providers should do

Providers currently charging or proposing to charge fees for additional services, including ‘capital refurbishment fees’, ‘asset replacement contributions’ or similar fees, should review those arrangements to ensure they are consistent with the provider responsibilities under the Act and those outlined above.

Further information

More information is available on the department’s webpage. If you have any queries about this information, email agedcarefeesandpayments@health.gov.au or post to:

Director
Fees and Payments Section, Department of Health
MDP 560, GPO Box 9848
Canberra ACT 2601

This information does not constitute legal advice. Approved providers should seek their own independent advice.

Ageing and Aged Care Group
Department of Health

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