New legislation came into effect on 1st July 2014 regarding accommodation pricing for residential aged care.

The previous system of accommodation bonds for ‘low care’ and daily accommodation charge for ‘high care’ residents was replaced by a system of Accommodation Payments that apply to all people who have been assessed as requiring residential aged care.

Under the new system, residents will undergo a means test by Centrelink to determine if they are required to pay an accommodation payment.

If a resident’s mean test exceeds the legislated threshold they can then be asked by the aged care provider, such as Assisi Aged Care, to pay the accommodation payment applicable to their room.

The payment can be made as a Refundable Accommodation Deposit (RAD), a Daily Accommodation Payment (DAP) or combination of both.

New residents will have a choice as to how they pay the agreed accommodation price and will have up to 28 days after they enter care to decide how they will pay.

Persons whose means tested amount is under the means test threshold will still be able to afford residential aged care as the Government will provide the aged care provider with a supplement. Some contribution may be required but it will be limited to a threshold based on the persons means tested amount.

Persons with assets above the means tested amount but who cannot pay the maximum accommodation payment for the room may be asked to top up the payment by a daily charge or drawdown of the refundable deposit amount from their RAD.