Legislative Threshold Update – 1 January 2016

Facts

Post 1 July 2014 rules

Fees and charges for residents who:

  • first enter a residential aged care facility on or after 1 July 2014, or
  • first entered residential aged care before 1 July 2014 and subsequently cease to be provided with care for more than 28 days, or
  • first entered residential aged care before 1 July 2014 and move aged care facilities and make a written election to be covered by the post 1 July 2014 rules.

 

Residential Aged Care – Daily Care Fees

Basic Daily Care Fee:

Paid by all residential aged care residents

$47.86 per day

Means Tested Care Fee:

Means tested care fee is the lesser of:

  • Means tested amount – Maximum accommodation supplement $53.84 per day
  • Annual cap $25,731.05
  • Lifetime cap $61,754.55

Means tested amount = Income test contribution + Asset test contribution

Income test contribution:

= [(Total assessable income – income free area) × 50%] ÷ 364 Total annual assessable income:

  • Income assessable for Centrelink/DVA purposes
  • Centrelink/DVA income support payments less minimum pension supplement of $899.60 pa each and clean energy supplement of $366.60 pa each

Income free area:

  • Single $25,487.80
  • Couple, illness separated $25,019.80

Asset test contribution:

= (17.5% of assessable assets between $46,000 and $157,987.20, plus 1% of assessable assets between $157,987.20 and $381,961.60, plus 2% of assessable assets above $381,961.60) ÷ 364 Total assessable assets:

  • Assets assessable for Centrelink/DVA purposes
  • Refundable accommodation deposit/contribution
  • Capped value of former home (applies separately to both members of a couple) $157,987.20

Accommodation Payments/Contributions:

The means tested amount at the time of entry is used to determine whether a resident pays an accommodation payment or receives Government assistance and pays an accommodation contribution.

Residents with a means tested amount above the maximum accommodation supplement will pay an accommodation payment.

Centrelink/DVA assessment – Refundable Accommodation Deposit (RAD) or Refundable Accommodation Contribution (RAC) are exempt from income and assets tests

Minimum permissible asset level

(Minimum amount of assets a resident must be left with if they pay at least part of their accommodation costs as a refundable deposit)

$46,000

Maximum permissible interest rate

  • 6.22% (for all new residents from 1 Jan 2016 – 31 Mar 2016)

Maximum Refundable Accommodation Deposit

(Amount that can be charged without prior approval from the Aged Care Pricing Commissioner)

$550,000

Accommodation contribution

Payable where means tested amount at date of entry <$53.84 Calculated as the lesser of:

  • Means tested amount
  • Maximum accommodation supplement

Maximum accommodation supplement (significantly refurbished) $53.84

Maximum accommodation supplement (not significantly refurbished) $35.08

 

Home Care – Daily Care Fees

Basic Daily Care Fee:

Paid by all people who start receiving a Home Care Package from 1 July 2014

$9.85 per day

Income Tested Care Fee:

Income < Income Free Area – Nil

Income between income free area and income test threshold. Lesser of:

  • (Total assessable income – income free area) × 50%) ÷ 364
  • Cost of care
  • Annual cap $5,146.20
  • Lifetime cap $61,754.55

Income exceeds income test threshold. Lesser of:

  • (((Total assessable income – income threshold) × 50%) + $5,000) ÷ 364
  • Cost of care
  • Annual cap $10,292.41
  • Lifetime cap $61,754.55

Income free area:

  • Single $25,487.80
  • Couple – living together $19,780.80
  • Couple – illness separated $25,019.80

Income test threshold:

  • Single $49,296.00
  • Couple – living together $37,726.00
  • Couple – illness separated $48,828.00

 

Current deeming thresholds and rates

Threshold (single) $48,600

Threshold (couple–combined) $80,600

  • Lower Rate 1.75%
  • Higher Rate 3.25%
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