A new agreement has been reached between the Federal Government and the Coalition to reform Australia’s aged care system, which will lead to increased costs for some elderly citizens.
Under the new deal, individuals entering residential aged care will face higher means-tested contributions, and the maximum allowable price for a room in a facility will be raised. Additionally, residential aged care providers will now have the ability to retain a small portion of accommodation deposits from residents.
These reforms are expected to save the Federal Government $12.6 billion over the next 11 years. A key component of the agreement is the “no worse off principle,” ensuring that those already in aged care will not experience an increase in their financial contribution.
For new entrants, the fee structures will be adjusted to reflect higher means, though the government asserts that 70 percent of individuals on a full pension and 25 percent of those on a partial pension will not see an increase in their contributions.
In addition to these changes, the government will invest $4.3 billion into a new Support at Home program, set to begin in July 2025. This initiative aims to support nearly 1.5 million Australians and will involve more comprehensive means of testing based on individual circumstances.
The deal was finalised following urgent party room meetings between the government and Coalition on Thursday morning, concluding months of behind-the-scenes negotiations.
Source: ABC News.
