Understanding Residential Aged Care Fees and Charges under the New Aged Care Act

With the New Aged Care Act having launched on 1 November 2025, it is more important than ever to stay updated on all the changes coming into effect. This includes key information on updates to fees in Residential Aged Care, whether you're already receiving care or are planning to in the near future.

These changes implemented by the Australian Government are designed to make the system fairer, clearer, and more sustainable while ensuring residents continue to receive safe, high-quality care.

The Australian Government will continue to fund most aged care costs. However, depending on your income and assets, you may be asked to contribute to your accommodation and daily living expenses. Your contribution will be determined by Services Australia.

If you’re unsure how these changes apply to you, contact My Aged Care by calling 1800 200 422 or visiting www.myagedcare.gov.au

Accommodation costs: how you can choose to pay

When you enter residential care, you can choose how to pay for your accommodation:

• Refundable Accommodation Deposit (RAD) – refunded when you leave care, less any agreed deductions.
• Daily Accommodation Payment (DAP) – paid periodically and not refunded when you leave.
• A combination of RAD and DAP. 

Two different fee structures

From 1 November 2025, there are two different fee structures. Knowing which one applies to you is the first step.

Section 1 - New fee structure: for people new to residential aged care and have not been approved for home care before 12 September 2024. 

Section 2 - Grandfathered fees and arrangements: for people who were approved for home care before 12 September 2024. 

If you are unsure which fee structure you fall into, please contact My Aged Care on 1800 200 422 for clarification. 

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Section 1 – New Fee Structure (from 1 November 2025)

Residential aged care fees are made up of several components that cover your daily living costs, care needs, and accommodation. These fees ensure that every resident receives quality care and access to comfortable living environments.

The following outlines the main types of fees and charges that apply when you enter residential aged care under the new Aged Care Act arrangements effective from 1 November 2025.

If you are unsure, please contact My Aged Care by calling 1800 200 422 or visiting www.myagedcare.gov.au

Basic Daily Fee

• Covers everyday living costs such as meals, cleaning, laundry, heating and cooling.
• Set by the Australian Government at 85% of the single basic Age Pension.
• Indexed twice a year (20 March and 20 September) in line with changes to the Age Pension.
• This fee applies to all residents.

Clinical Care Contribution

• Covers the cost of care provided by qualified nurses and allied health professionals.
• Includes assessments, medication management, and clinical supervision.
• Fully funded by the Australian Government.

Non-Clinical Care Contribution

• Helps cover the cost of personal care and daily living support such as bathing, dressing, and mobility.
• Means tested based on your income and assets.
• Services Australia will advise you if you need to pay a Non-Clinical Care Contribution.

Hotelling Supplement

• Helps cover the additional day-to-day costs such as extra food, laundry, and utilities.
• Means tested based on your income and assets.
• Services Australia will advise you if you need to pay a Hotelling Supplement.

Refundable Accommodation Deposit (RAD) Retention

• From 1 November 2025, providers may deduct a small retention of 2% per year (for up to 5 years).
• This helps maintain and improve accommodation quality.
• The remainder of your deposit remains refundable when you leave care.

Daily Accommodation Payment (DAP) Indexation

• Your DAP will be adjusted every six months in line with the Consumer Price Index (CPI).
• You’ll receive written notification from Benetas of any change.

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Section 2: Grandfathered Fees and Arrangements

If you were approved for a Home Care Package before 12 September 2024 and enter residential aged care after 1 November 2025, you will remain on the pre 1 November 2025 fee arrangements.

If you are unsure, please contact My Aged Care on 1800 200 422 or visit www.myagedcare.gov.au

Residents in this category will continue to be assessed under the current Means Tested Care Fee System. These residents will not transition to the new 1 November 2025 care fee and hotelling contribution arrangements, however the new accommodation fee arrangements will apply.

Basic Daily Fee

• The Basic Daily Fee remains consistent with the current arrangements.
• Covers everyday living costs such as meals, cleaning, laundry, heating and cooling.
• Set by the Australian Government at 85% of the single basic Age Pension.
• Indexed twice a year (20 March and 20 September) in line with changes to the Age Pension.
• This fee applies to all residents.

Means Tested Care Fee System

• The Australian Government pays most aged care costs through subsidies.
• You may be asked to contribute based on your income and assets.
• Services Australia (Centrelink) assesses your situation and notifies you and Benetas.
• Annual and lifetime caps protect you from excessive fees.

Refundable Accommodation Deposit (RAD) Retention

• From 1 November 2025, providers may deduct a small retention of 2% per year (for up to 5 years).
• This helps maintain and improve accommodation quality.
• The remainder of your deposit remains refundable when you leave care.

Daily Accommodation Payment (DAP) Indexation

• Your DAP will be adjusted every six months in line with the Consumer Price Index (CPI).
• You’ll receive written notification from Benetas of any change.

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Additional Resources

These additional resources include the full residential aged care fees and charges for both fee structures, your rights, and the support available to help you understand and plan. 

1. Residential Aged Care Fees and Charges Guide (PDF)
2. Aged Care Code of Conduct FAQs (PDF)
3. Aged Care Statement of Rights FAQs (PDF)

We’re Here to Help

If you have questions or would like help understanding your fees and options, please get in touch with our friendly team by calling 1300 23 63 82