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Your income vs a Home Care Package: Is it worth it to apply?



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It surprises many to discover Home Care Packages are not means tested, and not just for pensioners. They are available for anyone aged 65+ or 50+ with an Aboriginal and Torres Strait Islander background – and needing extra help at home.

Starting from $9k per year for those on a Level 1 who need a little help, Home Care Packages provide up to $52k per year for those on Level 4 with more complex needs.

But while eligibility may not depend on your or income, the Australian government does set some rules about how much you receive. Trying to make sense of those rules, however, can be a challenge!

So, we’ve broken it down and crunched the numbers for you to let you see, at a glance, what benefit you may receive. In this article we cover:

  • The Home Care Package funding rules
  • Your income vs Home Care Package benefits
  • Income brackets and funding caps
  • Deciding if its right for you 


Let’s start with rules and definitions!

While Home Care Packages as not means tested, the government does expect you to contribute to your own care if you’re able to. There are two ways this may occur:

Basic Daily Feessome Home Care Package providers charge a daily fee that you pay from your own pocket towards your care services, which can be up to $4k per year. However, not all providers charge this, so you can easily avoid this fee simply by choosing a Home Care Provider, like Age Up, that does NOT charge you this fee.

Income Tested Fees – this fee is set by the government once it assesses your income and how much it deems you should contribute to your care services.

So, if you must pay fees towards your own care, the question is do you earn too much and is it worth your time applying for a Home Care Package?

The short answer is that you’ll want to ensure you are getting more value from your Home Care Package than you pay in fees.

And be aware that because it is based on your income, you’ll pay the same fees regardless of whether you are on a Level 1,2,3 or 4 Home Care Package. So, if you’re paying a high fee and you are on a low-level Home Care Package, it may not be worth it.


Let's do the math!

The good news is that the Income Tested Fee (ITF) is capped, so the most you’ll be asked to contribute is $31.63 per day, and there are yearly and lifetime limits to how much you pay (see below). And anyone on a full pension is not typically required to pay fees at all.

Let’s look at some simple examples to get a better understanding:


Level 1
Paying $4 per day

 
If you pay $4 per day on Level 1, the government will contribute $20.73 per day


Per year

You pay $1460
You receive $7566

 (Total funds $9026)



Level 1
Paying $20 per day


If you pay $20 per day on Level 1, the government will contribute $4.73 per day


Per year

You pay $7300
You receive $1726

 (Total funds $9026)



Level 4
Paying $20 per day

If you pay a $20 fee per day on Level 4, the government will contribute $123.50 per day.


Per year

You pay $7300
You receive $45,078
 

(Total funds $52,378)






    Be aware that you’ll also need to pay your Home Care Provider fees from the total funds available.

    These can vary greatly depending on your provider and whether you go with Self-managed or Provider-managed service. Learn more:




    How to calculate how much you'll pay

    The daily amount of your Income Tested Fees is set by your individual income and is calculated during income assessment. You can visit the government’s My Aged Care website and use the fee estimator to take a closer look.  

    But here’s a quick guide to see which bracket you fall under.

    Who?

    Earning 

    Per day you pay


    You pay per year

     

    Full pensioner
     
    Under 28,974.40
    $0.00
    $0.00
    Part pensioner
     
    Over 28,974.40
    $0 - 16.15 $5,879.85 (max)
    Single person
     
    Over $28,974.40 $0 - 16.15 $5,879.85 (max)
    Living as part of a couple in the same house
     

    Over $22,471.80
     
    $0 - 16.15 $5,879.85 (max)
    Living apart as a couple due to illness
     

    Over $28,454.40
     
    $0 - $16.15 $5,879.85 (max)
    Single person
     
    Over $56,035.20 $16.15 - $32.30 $11,759.74  (max)
    Living as part of a couple in the same house
     

    Over $42,868.80
     
    $16.15 - $32.30 $11,759.74  (max)
    Living apart as a couple due to illness
     

    Over $55,515.20
     
    $16.15 - $32.30 $11,759.74  (max)

    More FAQs about the Income Tested & Basic Daily Fees

    Q: Why do only some providers charge Basic Daily Fees?
    Each provider's fees vary and some charge a lot more than others. The Basic Daily Fee is one such cost, which goes to the provider as extra income and is completely optional for them to charge. At Age Up, we charge one fee with no hidden extras including no Basic Daily Fee. Learn more about our pricing.


    Q: Can I be asked to pay both the Basics Daily Fee & Income Tested Fee?

    Yes! Which is even more reason to ensure you pick a Home Care Provider that doesn't opt to charge you a Basic Daily Fee. The more fees you pay, the less you'll have available to spend on your care services


    Q: Does the Income Tested Fee top up my funding?

    No, the Income Tested Fee is your contribution that together with the government funds combine to make up the total funds available for each Home Care Package Level:

    Home Care Package Level
    Total annual funds
    Home Care Providers can help
    you apply for further funding supplements up to:
    Level 1
    $9,026.45
    $10,064.49
    Level 2
    $15,877.50
    $17,703.41
    Level 3
    $34,550.90
    $38,524.25
    Level 4
    $52,377.50
    $58,400.91


    Q: Can I pay the Income Tested Fee or my Basic Daily Fee out of my funds package?

    No, these fees must be paid out of your own pocket.


    Q: If you are asked to pay an Income Tested Fee, is it worth it?

    As outlined in this article, the key consideration when you are paying an Income Tested Fee is whether or not you going to get more value from your Home Care Package funding than you pay in fees? On top of the funds available, you’ll also need to weigh up the benefits of having the ongoing support from a Care Management team.


    New to Home Care Packages?
    Here's some more useful resources: 



    Beginner's Guide to Home Care Packages

    An easy-to-follow guide on eligibility, how to apply, the role of your provider and more. Get guide.


    To help make sense of all the various choices, we've compiled some the favourite tips we share when people call confused about how to compare providers. Read now.


    Waiting for funding to come through can take time! Here, we've compiled our Top 7 Survival Tips for what to do about care when on the National Waitlist. Find out.


    Everyone will tell you that you can get a cleaner or a gardener. But with a bit of knowledge, your Home Care Package can provide you with so much more!  Discover.



    Need support with your Home Care Package?

    We’re here to help. Age Up Health provides packages that are designed to keep you happy and healthy at home, where you belong.

    Our services are simple.

    Expect a single fee and the same friendly face each time. And rest assured that our packages are flexible enough that you can make changes whenever you wish.

    Contact us today to find out more.
    Or book a free 15-minute consultation with one of our consultants.

    In need of in-home aged care services?

    Contact us today to find out how we can support you and your loved ones.


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