Free No More: The Changed Reality of Aged Care Costs
A Major Change in How Australians Access Support
From 1 November 2025, Australia’s new Support at Home program begins, replacing the long-standing Home Care Packages system. These Aged Care reforms cost – and those costs will be shared for future users.
The change marks one of the most significant reforms in aged care since Medicare’s creation. This new framework will affect how millions of older Australians receive and pay for support at home. It flows from the Aged Care Act 2024, passed by Parliament in late 2024. It represents a complete redesign, not a minor update. The aim is sustainability—but it also brings new financial responsibilities for many households.
Under the new system, the government will fully fund clinical care, including nursing and physiotherapy. However, non-clinical support—such as cleaning, meal preparation, and personal assistance—will now attract co-payments. For many, this is a major shift from what used to be free or heavily subsidised.
The Cost of Everyday Help
Everyday care will now come at a cost.
Providers can currently set their own prices, typically charging about $100 per hour for personal care and $95 per hour for domestic help.
Australians will contribute on a sliding scale based on their income and assets.
- Personal care (showering, medication help): 5%–50% of provider fees
- Domestic assistance (cleaning, laundry, cooking): 17.5%–80% of provider fees
That means even a simple shower or meal preparation could cost $50–$75 per hour for some people.
The higher your means, the greater your share. Even full pensioners will contribute at least a small percentage.
Who Is Protected—and Who Isn’t
Not everyone will feel the change immediately.
If you are already receiving a Home Care Package, or are on the waiting list and assessed as eligible by 12 September 2024, you remain protected. This safeguard is known as the ‘No Worse Off Principle’. You will continue to pay what you did under the old system.
But those applying after that date will face the new co-payment rules. With more than 130,000 people still waiting for packages, many will transition into this costlier system.
Protected:
- Existing Home Care Package recipients
- People on the National Priority System (waitlist) or assessed as eligible before 12 September 2024
Unprotected:
- Anyone approved after 12 September 2024
For families applying from 1 November 2025, this distinction could mean thousands of dollars each year in extra costs.
The official rollout period gives providers until 1 July 2026 before price caps are introduced.
Until then, providers can continue to set their own rates. This may leave new clients paying higher fees in the meantime.
How the Co-Payments Work
Here’s how the Aged Care reforms cost contributions will generally apply:
| Service Type | Full Pensioner | Part Pensioner | Self-Funded Retiree |
| Personal Care | 5–17.5% | 17.5–35% | 35–50% |
| Domestic Help | 17.5–35% | 35–65% | 65–80% |
The model assumes that those with more resources should pay more. However, this also means even the most financially vulnerable will now pay something.
Concerns About Fairness
Not everyone agrees with the reform. Natalie Siegel-Brown, Australia’s Inspector-General of Aged Care, warned that the new system risks harming lower-income Australians. She said it contradicts the Royal Commission’s call for needs-based care, not wealth-based care.
Her concern is that essential daily help—such as hygiene, meals, or mobility—should not depend on a person’s bank balance. Advocates argue that health and dignity should remain universal rights, not financial privileges.
What It Means for Families
If at the date of this change, you or a loved one already receives home care, your current arrangements will stay the same. Providers will contact you about new agreements, but your fees won’t rise.
Residential Aged Care Also Changes
The reforms extend beyond home care. In residential facilities, Refundable Accommodation Deposits (RADs)—often exceeding $750,000—will no longer be fully returned. Providers can now retain 2% of the RAD each year, capped at 10% after five years.
New residents will also pay daily means-tested fees for non-clinical care such as bathing and meals.
These could reach up to $100 per day, plus additional accommodation charges.
For families, these changes highlight the importance of understanding costs and planning early for care needs.
A System Still in Transition
Originally, Support at Home was scheduled to start on 1 July 2025 but was delayed four months to allow more preparation time. Many providers believe the system isn’t ready for such sweeping change.
Where to Get Help
If you need guidance, start with:
- My Aged Care: myagedcare.gov.au or call 1800 200 422
- Fee estimators to preview potential co-payments
- Financial advisers specialising in retirement and aged care
A financial plan can help you balance your savings, income, and care needs while maintaining lifestyle and independence. Continuum Financial Planners are accredited Aged Care Specialists.
What This Means for You
Australia’s aged care system is changing direction—from collective responsibility to individual contribution. The goal is long-term sustainability, but it comes at a personal cost.
Existing applicants remain shielded for now. Future applicants will need to plan carefully to manage new co-payments and fees.
For families, understanding these rules early—and acting before key deadlines—can make a meaningful financial difference. It’s a time for awareness, not alarm. With early preparation and professional advice, you can approach the new system with confidence and control.
Engage with ContinuumFP to plan your aged care reforms costs
If you or a member of your family or care group are confronting Aged Care service changes, engaging the services of the accredited Aged Care Specialist at ContinuumFP will be beneficial to you. To make an appointment with our team –
- phone our office on 07-3421 3456, or
- at your convenience, use the linked Book A Meeting
(This article was originally posted by us in October 2025.)