The landscape of aged care services in Australia is changing with the introduction of the new Aged Care Act. With these upcoming changes, early preparation is crucial. The following information outlines what we know of the legislation thus far. We will provide updates as the current Bill passes into law and rules and regulations are introduced.
Understanding the New Legislation
The Aged Care Act is currently a Bill in the Commonwealth Parliament. It is expected to pass with bipartisan support and will introduce critical reforms. It aims to address recommendations from the Royal Commission into Aged Care Services and the Aged Care Taskforce. Although the official changes take effect on July 1, 2025, understanding them now can make a significant difference.
For instance, the term ‘Home Care’ will evolve into ‘Support at Home’. This is not simply a change in terminology; it represents a comprehensive reform in how care is delivered and funded. The government subsidy will decrease from 95% to 89%, meaning care recipients will need to contribute a greater portion to their care costs. This transition will impact everyone, but less so for those relying heavily on government support.
Why Planning Matters:
Some Real-World Examples of planning and preparation
Reviewing these real-world scenarios shows that thoughtful planning can make a significant difference in managing aged care costs.
Consider Margaret, she is a retired teacher with modest savings. She previously anticipated relying on home care support at a minimal cost due to the level of government subsidy. With the new Act, her out-of-pocket expenses will be higher than under the old legislation. By seeking early advice, she can make more informed decisions regarding her care needs.
By forward planning, Margaret can now explore options such as securing a place under the grandfathered system, which may offer lower fees. This strategic move helps her minimise costs while considering her long-term care preferences.
Planning ahead as Margaret has done isn’t just a good idea, it’s essential.
The new Act introduces a single assessment system combining the Regional Assessment Service (RAS) and the Aged Care Assessment Team (ACAT). This streamlining could simplify access to financial assistance, but it also requires a keen understanding of eligibility criteria.
Take John, who holds a Commonwealth Seniors Health Card. He faces the dilemma of whether to disclose his financial situation to Centrelink. With professional advice, John was able to choose whether to disclose his finances to Centrelink, allowing him to keep his privacy while still receiving support.
Why Financial Advice is Essential
The Aged Care landscape is complex. Those who seek professional advice often find themselves better prepared. Our financial advisers can help clarify the changing rules, empowering you to make strategic decisions rather than responding to challenges as they arise.
Actionable Takeaways
Here are some practical steps to help you prepare for the changes:
- Seek Professional Advice: Partner with our accredited Aged Care experts to navigate these complexities and avoid potential pitfalls.
- Stay Informed: Keep abreast of changes to the Aged Care Act. The information about it is constantly evolving.
- Plan Early: Assess your current financial situation and anticipate future costs. This foresight will empower you to make informed choices.
- Consider Your Options: Evaluate whether to remain in the current system or transition to the new one. Each scenario has potential advantages.
Help from Continuum Financial Planners Pty Ltd
The new Aged Care Act brings significant changes to how care services will be delivered and funded. By preparing now, understanding your options, and seeking professional advice, you can navigate this transition with confidence. Our team of advisers includes an accredited Aged Care advice specialist.
For personalised advice, arrange an appointment, by –
- calling our office at 07-3421 3456 or
- At your convenience, use our Book A Meeting facility.
(This article was published in September 2024.)
