4. What are the costs of a Consumer Directed Care (CDC) Home Care Package?
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There are costs associated with Government Funded Consumer Directed Care Home Care Packages that are not charged with privately paid care, which consumers with a Home Care Package need to understand. Discover here the true costs of Consumer Directed Government Subsidised Home Care Packages.
There are 3 types of fees payable for a Government Subsidised Funded Home Care Package:
1. Fees set by the Government;
2. Fees set by the Approved Provider for the management of the Home Care Package in line with the Government Guidelines and,
3. Fees for Direct Care or support services bought or provided by the Home Care Package via the Approved Provider or companies they contract to.
1. Fees set by the Government (From 20 March 2019 to 19 September 2019)
The Maximum Basic Daily Care Fee (BDCF)
The Consumer Directed Home Care Program prefers Elders to make a co-contribution to the funding of their care. Whilst it is called a “Maximum Basic Daily Fee” it is not “a fee” in the true sense of the word. It is actually a co-contribution and therefore increases your Home Care Package income to be spent on your care.
The Maximum Basic Daily Care Fee, or co-contribution, for a senior on the full pension is currently $10.54 per day, per person so $147.56 per fortnight, per person i.e. $3,847.10 pa pp. This represents 17.5% of the single person basic age pension. (This rate increases on the 20th March and the 20th of September each year in line with changes to the Age Pension) source
Tip: If you cannot afford the Basic Daily Fee, it is possible to apply to the Government for a Hardship Financial Supplement i.e. they may then pay some or all of your Basic Daily Fee or Income Tested Care Fee to your Approved Provider for you.
The Hardship Financial Supplement is then added to your Home Care Package funding. The Government may specify that the Hardship Financial Supplement is only for a set time at which point you need to reapply. More information can be found at: https://agedcare.health.gov.au/aged-care-funding/hardship-supplement-in-home-care
A successful Financial Hardship Application letter looks like this – see below. Note the letter says when the Basic Daily Care Fee is waived from and to and this client needs to apply again for the Financial Hardship Supplement from October 2018.
Income-Tested Care Fee
If you are a Part Pensioner or Self-funded Retiree i.e. you earn the income listed below or more, you are still eligible to receive a Government Subsidised In Home Care Package.
However, the Government requires you to pay an Income Tested Care Fee towards your Government Funding. Whatever you pay the Government as your Income-Tested Care Fee, reduces your Government Funding by that same amount.
The Government requires you to pay an Income-Tested Care Fee if you are a Part Pensioner or Self-funded. You are Self-funded if you have a yearly income above the following thresholds:
- Individual person – $52,036.40 pa.
- Member of a couple but now separated due to illness (individual income) – $51,516.40 pa.
- Member of a couple living together (single income) – $39,806.00 pa.
The Department of Human Services calculates your Income-Tested Care Fee based on an assessment of your financial information. If you are a member of a couple, half of your combined income is considered in determining your income-tested care fee, regardless of which partner earns the income. The good news is that when receiving in home care, the assessment does NOT include the value of your home or any other assets.’ source
Tip: If you are due to pay the Income Tested Care Fee but cannot afford it because, for example, some of your investments are frozen and cannot be accessed to pay your Income Tested Care Fee, it is possible to apply to the Government for a Hardship Financial Supplement i.e. they may then pay some or all of your Income Tested Care Fee to your Approved Provider for you.
The Hardship Financial Supplement is then added to your Home Care Package funding. The Government may specify that the Hardship Financial Supplement is only for a set time at which point you need to reapply. More information can be found at: https://agedcare.health.gov.au/aged-care-funding/hardship-supplement-in-home-care.
2. Fees set by your Approved Provider
Case Management and Core Advisory Fees
Approved Providers can charge fees called “Core advisory and Case Management Fees”. These fees are to cover the cost of Case Managing your care.
When Elders are in the later stage of their aged care journey (i.e. in receipt of level 3 or 4 Home Care Packages) they are often largely being Case Managed by their loving adult children or Enduring Power of Attorney and Enduring Guardian. It’s the adult children who are working out what care their parent(s) need, which days of the week work best with the Elder’s schedule and what times of the day best suit their parent. What type of care will give them best value and which Care Provider they want.
If the client has a fall it’s the adult children who are rushing to the hospital and by their side, not the Approved Provider’s Case Manager.
Brilliant Approved Providers understand that reality and they really care about the client’s wish to remain at home for life and that’s why they operate efficiently and don’t “double up” on services and therefore charge a reasonable administration and case management fee that allows them to meet the Government Guidelines, yet maximise care hours for the Elder. At least that is what we do at Daughterly Care Community Services.
Unethical Approved Providers, well they just want to maximise their fees and they fight you every step of the way, inflating their role to justify their high fees. Such organisations will only “meet the market” when sufficient clients have transferred away from them.
Contingency Fees are not a true fee. It is quarantined money put aside from your Government Funding and Consumer Contributions to pay for unplanned future care and support.
The Government allows Approved Providers to charge up to 10% pa as a contingency fee.
Up to the 27 February 2017, the Government allowed Approved Providers to KEEP for THEMSELVES all unspent funds inclusive of Contingency Fees that had accumulated in an Elder’s Home Care Package when the elder no longer needed their package i.e. died or moved into a Nursing Home.
With that rule, all Approved Providers had a vested financial interest to charge the maximum 10% pa contingency fee for all clients. I have seen unspent balances of $23,000 while the poor “high care” client was paying for the extra care they needed privately, because their Rogue Approved Provider would not let them spend their $23,000 unspent Government Funding on their care.
From 27 February 2017, all unspent fees including the Contingency Fee are returned to the Government to fund the care of other Elders. However Approved Providers still commonly tell Elders they need a Contingency Fee because that is how they collect their ‘Exit Fee’ when you leave for better service, better value and more hours of care. It’s not surprising then to see exit fees of $5,000+ as has been reported in the press.
Voluntary Top Up Fees
If the Government Subsidy does not cover all the consumer’s care requirements, and often it doesn’t, the Approved Provider will suggest that the consumer voluntarily pay private / voluntary funds to “top up” their Government subsidised Home Care Package.
When you pay the “Voluntary Top Up Fee” to your Old School Approved Provider, from statements I have audited, most Approved Providers also charge their administration and case management fees on the voluntary private care paid.
Daughterly Care does not.
Most will keep a percentage of your voluntary / top-up care fees in administration and case management fees whereas the New Breed Approved Providers such as Daughterly Care Community Services do not charge Government or Approved Provider Fees on any privately paid care or voluntary contributions.
Therefore, I strongly recommend that you don’t buy “Voluntary Top up Care” through your Old-school Approved Provider, as typically you will lose 34% pa.
Example from a statement I audited:
The adult child was told $8,000pa of Voluntary Top Up Fees were needed. The adult child did not realise 39%pa was being kept of the $8,000 and Government Funding BEFORE any hours of care were bought. The client was able to buy 39% more care by buying those Voluntary Top Up hours direct from Daughterly Care as we don’t charge administration and case management fees on private care fees.
3. Fees for direct care bought or provided by your Home Care Package via the Approved Provider
Daughterly Care charges ‘middle of the road’ fees for direct care provided by our very high quality of our Caregivers. Here is a link to the fees payable for direct care. When you have a Home Care Package the direct care is paid by your Government Subsidised Home Care Package up to a set number of hours depending your level of in home care package as you can see on this page.