9. Should Self Funded Seniors accept a Level 2 Home Care Package?
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You are a self-funded senior who has been approved for a Level 4 Home Care Package but only assigned (offered) a Level 2 Home Care Package, should you accept the Level 2 Home Care Package or just wait for a Level 3 or 4 Home Care Package? This is one of the most frequently asked questions we are asked by self-funded Elders. Let’s explore the different factors to consider so you can make the decision that is right for you.
Should Self-Funded Seniors accept a Level 2 Government Funded Home Care Package?
Self-funded Elders will be given various answers to this question depending on who they are talking to and what assumptions have been made. Advice will range from:
- “it is cheaper just to go private”; to
- “definitely accept the Level 2”.
The right answer for you depends on your circumstances, so let’s do the maths together for Daughterly Care clients because we have made some changes recently to make a Level 2 Home Care Package more financially rewarding for a self-funded senior. We will also explore the factors that can affect your decision.
Is there a financial benefit from a Level 2 Home Care Package for self-funded seniors?
Quick answer: with Daughterly Care Community Services it IS worth accepting a Level 2 Home Care Package and if a couple has 2 Home Care Packages, we can make it worth your while even more.
Level 2 Home Care Package financial viability for a self-funded Elder (correct from 20/3/2019 to 30/6/2019)
- fully self-funded senior;
- not entitled to a cognitive or DVA 11.5% supplement; and
- Daughterly Care does NOT charge the Maximum Basic Daily Care
|Annual Level 2 Home Care Package Government Funding||$15,045.30 pa|
|Less: Government doesn’t pay an amount equal to the Income Tested Care Fee for self-funded senior||(- $11,012.99 pa)|
|Equals: the Real Annual Level 2 Home Care Package funding for a self-funded Senior||= $4,032.31 pa|
However, you need to deduct any additional fee charged by your Approved Provider for administering the Government’s Home Care Package Program and case managing care.
So in Daughterly Care’s case that is 20%pa of the Home Care Package i.e. $15,045.30 X 20% = $3,009.06pa
So, the true financial benefit from the Government after all costs is $4,032.31 – $3,009.06 = $1,023.25pa
So, the amount available to spend on care or services is:
$15,045.30 – $3,009.06 = $12,036.24
divided by 52 weeks = $231.46 per week.
So, your Government Subsidised Level 2 Home Care Package through Daughterly Care will provide $231.46 per week of care.
For that benefit of $12,036.24 you have paid $11,012.99 annual Income Tested Care Fee / 52 weeks = $211.79. (The Income Tested Care fee is calculated daily and charged monthly and is $30.25 per day).
So, it has cost the self-funded elder $211.79 per week to receive a benefit worth $231.46….yes, I agree….for Self-Funded Seniors, it is barely worth accepting a Level 2 Home Care Package – i.e. you are only $19.67 a week better off financially.
Now you can understand why if a Senior just wanted ad hoc assistance from time to time we advised against accepting a Level 2 Home Care Package.
What we don’t know is this…is accepting the Level 2 Home Care Package given a heavier weighting by the Government’s Home Care Package Allocation Algorithm and therefore means you are more likely to receive your Level 3 or 4 Home Care Packager quicker than if you didn’t accept the Level 2 Home Care Package? We have seen that happen numerous times, though it may have been a co-incidence and we can’t prove it.
What about the Lifetime Cap for the Income Tested Care Fee?
If you needed 3.5 hours of care every week, which is what your Level 2 Home Care Package pays for then you would have bought private care more than to the Income Tested Care Fee and not reduced your Annual or Lifetime Caps.
So, by accepting the Level 2 Home Care Package…you are $19.67 better off a week and you are reducing your Lifetime Cap. When you reach your Lifetime Cap – you stop paying the Income Tested Care Fee, which is a saving of $11,012.94 pa. It takes 6 years to reach your Lifetime Cap.
Whereas if a self-funded client bought private in-home care for 2 years whilst waiting to be assigned their Level 3 or Level 4 Home Care Package, because they have paid privately, they will not have reduced their Income Tested Care Fee Annual Cap at all.