Key Aged Care Terms

At Rockpool Residential aged care, residents will be asked to make several types of payments depending on their situation and care needs. The fees are broken down into the following components:

1. Accommodation payments – this covers the cost of your accommodation and is based on the price of the room.
2.  Meals & Basic Services – also known as the ‘basic daily fee’ and is set by the government at 85% of the standard pension and covers meals, laundry, cleaning, etc.
3. Care fees – also known as a ‘means tested care fee’, contributing to the cost of your care
4. Other Expenses – this covers everything Rockpool offers above and beyond its requirements and any out of pocket expenses incurred by the resident not included in our services.

To understand these payments in more detail, keep reading on.

‍1. Accommodation Payments

When entering a residential aged care home there are three options of how accommodation can be paid for, which include the following:

• a refundable deposit – paid as a lumpsum amount.
• daily payments – accrued daily and paid periodically i.e. monthly.
• OR a combination of both.

A Refundable Lump Sum

There are two types of refundable lump sum, a Refundable Accommodation Deposit or a Refundable Accommodation Contribution. How much you pay is dependent on the outcome of your means assessment.

A means assessment is undertaken by the Australian Government and assesses your income and assets to determine if they will contribute to your accommodation costs.

Refundable accommodation deposit (RAD)

A RAD is when you pay the lump sum amount in full. It is the accommodation price you agreed on with Rockpool. The price of the room is determined by the size of room you choose, the level the room is on, and the location of the home.

Refundable accommodation contribution (RAC)

A RAC is when the government subsidises the costs. It is calculated by your provider based on the daily accommodation contribution (DAC) determined by Services Australia. To understand DAC more, see the section below under Daily Payments.

If you choose to pay an amount as a lump sum, the balance is refunded when you leave the aged care home. Any amounts that you have drawn down from the lump sum to pay other aged care costs will not be refunded.

Daily Payments

If a RAD is not the option you want to choose, there is an alternative in daily payments. There are two types of daily payments, depending on the outcome of your means assessment.

Daily accommodation payment (DAP)

This is when you pay the full amount yourself. It is the accommodation price you agreed on with Rockpool. However, you pay this in daily amounts unlike with the lump sum where this is paid all at once.

Daily accommodation contribution (DAC)

This is when the government helps with the costs. The amount is determined by Services Australia based on your means assessment.

Daily payments work like rent payments, they are not refunded when you leave care.

A combination of refundable lump sum and daily payments

This is when you combine the two types of payments to meet your costs. You can split the combination any way you choose.

What is the maximum permissible interest rate (MPIR)?

The MPIR is a government-set interest rate used to calculate a daily accommodation payment based on your agreed room price. It is used to determine equivalence between a daily payment and a refundable lump sum deposit, giving you a choice in how to pay.

The MPIR is not an interest charge to residents who have not paid for their accommodation costs in full. It is set at a level to ensure that if you choose to pay daily payments rather than a lump sum, the daily payments are sufficient to cover the costs of providing accommodation in your aged care home.

Example of calculating DAP and reduced DAP

If the MPIR is 8.38% (as at 1 October 2024), an agreed room price of $450,000 would have an equivalent daily accommodation payment(DAP) of $103.32: 

DAP
= ($450,000 × 8.38%) / 365
= $103.32 per day

An example of a combination payment for a $450,000 room price is:

• a refundable deposit of $250,000
• a daily payment equivalent to the remaining $200,000, which is $45.92

Reduced DAP
= ($450,000 − $250,000) × 8.38% / 365
= $45.92

2. Meals & Services (Basic Daily Fee)

‍Everyone pays a basic daily fee. This fee helps pay for your day-to-day services such as meals, cleaning, facilities management and laundry. This fee is set by the government at 85% of the standard Australian pension.

‍3. Means Tested Care Fee

‍This fee is an extra contribution that some people pay, as determined through a means assessment. It is an ongoing fee towards the cost of your personal and clinical care.

The means tested care fee is different for everyone, and not everyone will have to pay it. If you do need to pay it, Services Australia will let you and your provider know the amount once you enter care.

Your means tested care fee will be between $0 and $403.24per day. The maximum means tested care fee changes with indexation and is regularly updated.

Annualand lifetime caps apply to the means tested care fee. This means once you reach a certain level of payments made, you cannot be asked to pay any more in meanstested care fees.

‍4. Other Expenses (Additional service fees & Out of pocket expenses)

‍These are fees for services that go beyond the minimum care and service requirements set out by the Australian Government. Every resident at Rockpool pays an additional service fee which may differ across our homes and is explained prior to admission.

Each Rockpool home goes above and beyond to provide apremium service offering, some of which include:        

• Extensive premium dining menu and experiences curated by our dedicated Dining Service Champions
• Alcohol and beverages included at all main meals
• Premium Toiletries
• Tea and Coffee making facilities
• Daily room cleaning and laundering of clothes
• High speed Wi-fi and Smart TV’s
• Comprehensive lifestyle calendar including daytrips / outings, pet therapy and an array of activities catered to our residents preferences
• Weekly happy hour, monthly birthday celebrations, along with a host of other celebrations
• Daily newspapers including extensive Digital Subscription to a variety of newspapers
• A number of other inclusions outlined in our homes
• Additional Services document retained prior to admission

Any expenses incurred outside of our Additional Services offering is paid directly by residents. To help you better understand the complexity of paying fees in aged care, we’ve prepared a document that outlines everything in a concise way. Click the button below to download.