Unlocking Maximum Value from Home Care Packages: A Guide to Costs, Benefits, and Making Informed Choices

by LukeAdmin

Ageing at home is easier to achieve with increased numbers of home care packages, but maximising your value needs an understanding of the rules and a comparison of fees.

For most people, home care is the preferred aged care option because it may allow you to age well while continuing to stay in your own home. But while it might be your preference, it is not always the best option.

Understanding how home care might work for you, needs a reality check around waiting times, adequacy of the care available and costs. Understanding fees and financial implications should be at the top of your research checklist.

What fees apply?
There are four levels of home care packages. Level 4 is the highest and gives you an annual budget up to $56,400 to spend. Some of this is your contribution, but most is paid by the government.

At just over $1,000 per week, this may seem like a lot of money, and it is, but not all of the budget is used to directly pay for your care. You first need an approved home care provider to manage the package – and they charge management fees which come off the top of your available budget. Then there are fees for the care services and perhaps staff travel time.
Providers can set their own fees, so compare fee schedules across providers. Competition and legislative changes have reduced these management fees, but you could still be using 20–25% of your package before you even start to receive any care services.

How far can the package stretch?
Let’s look at a case study for Athol who is approved for a Level 4 package. He has a budget of $2,169 per fortnight ($56,400 per year) to spend. Depending on his assessable income, Athol pays the first $154–$597 per fortnight and the government pays the rest.

Assume Athol and his family choose a provider that charges $434 per fortnight for management. This uses 20% of the budget. If care services are charged at $70 per hour, his remaining budget may be enough to fund just under 2 hours of care per day (less if charged for travel time). The provider may also charge varying prices for peak times, weekends or night–time services.

How to evaluate your options
A good place to start is with a family discussion to discuss what support your family can provide. And then review the financial implications. And this is where we can bring our experience and expertise.

Contact Sophie today on 02 4325 0884 to make an appointment.

Sophie Doyle (AR#000470612) is an Aged Care Specialist at Morgans Financial Limited (Morgans AFSL 235410 / ABN 49 010 669 726); with a passion for assisting people make informed financial decisions, as they navigate their way through retirement and aged care. Disclaimer: While every care has been taken, Morgans Financial Limited makes no representations as to the accuracy or completeness of the contents. The information is of a general nature only and has been prepared without consideration of your individual objectives, financial situation or needs. Before making any decisions, you should consider the appropriateness for your personal investment objectives, financial situation or individual needs. We recommend you see a financial adviser, registered tax agent or legal adviser before making any decisions based on this information. Current at 1 February 2022.

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