4. What are the costs of a Consumer Directed Care (CDC) Home Care Package?
There are costs associated with Government Funded Consumer Directed Care Home Care Packages that are not charged with privately paid care and consumers with a Home Care Package need to understand them. 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 Guidelines set by the Government; 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 September 2018 to 19 March 2019)
The Basic Daily Fee
The Consumer Directed Home Care Program requires Elders to make a co-contribution to the funding of their care. Whilst it is called a “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 Fee, or co-contribution, for someone on the full pension is currently $10.43 per day, per person so $146.02 per fortnight, per person i.e. $3,806.95 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.
Time-saving Tip for Self-funded Elders for existing Daughterly Care clients. If you are 100% certain, you are 100% self-funded, you do not need to complete the whole 16 pages of the SA456 form. Just complete your name and state you are self-funded, then send it to the Department of Human Services. This saves completing 16 pages and you pay the same maximum Income Tested Care Fee anyway.
If you are in receipt of a full Pension or part-pension, you just ring DHS and ask them to send you your “Home Care Fee letter” as they already know your financials.
This is the link to the 16 page form: https://www.humanservices.gov.au/customer/forms/sa456
Warning: If your Home Care Package started prior to 1 July 2014 then you are called a concessional elder and you don’t pay an Income Tested Care fee and therefore neither do you need the Annual and Lifetime Contribution Caps… see Home Care Package costs if you had a Home Care Package before 1 July 2014.
Tip: Do not give notice to transfer from your Current Approved Provider if you started your Home Care Package prior to 1 July 2014 unless we have told you we can take you on. Good news: We have had many concessional seniors transfer to us and they have ALL retained their concessional status.
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.