Quick answer: Aged care funding in Australia is provided by the federal government through subsidies paid directly to approved providers on behalf of eligible residents. In 2024–25, the Australian Government spent $39.8 billion on aged care services — equivalent to $7,895 per older Australian. Residents contribute to costs according to their income and assets, assessed by Services Australia. This guide explains every funding stream, how much the government pays, and what you contribute.
How Does Aged Care Funding Work in Australia?
Aged care funding in Australia works through a partnership between the federal government and the individual. The Australian Government pays subsidies directly to registered aged care providers on behalf of each eligible resident or home care recipient — covering the majority of care costs. The individual then contributes what they can reasonably afford, based on a formal means assessment conducted by Services Australia.
This model means that access to quality aged care is not limited to those with significant financial resources. A full Age Pensioner with limited assets pays far less than a self-funded retiree — but both can access the same standard of residential care at an approved facility. The government funding fills the gap between what the individual contributes and the actual cost of delivering care.
From 1 November 2025, aged care funding in Australia operates under the new Aged Care Act 2024, which replaced the Aged Care Act 1997 and introduced significant changes to how funding is structured — particularly for home care, where the old Home Care Package system was replaced by the new Support at Home programme.
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The Three Main Streams of Aged Care Funding in Australia
Aged care funding in Australia flows through three primary channels, each covering a different type of care. Understanding which stream applies to your situation is the first step to understanding what you will pay and what the government covers.
Residential Aged Care Funding: How the AN-ACC Model Works
For anyone entering a residential aged care facility, the government funding model is built around the Australian National Aged Care Classification (AN-ACC). This is the system the government uses to calculate how much subsidy it pays to the aged care home on behalf of each resident.
Every person entering permanent residential care has an AN-ACC assessment — a clinical evaluation that determines which of the 13 AN-ACC classes they fall into, based on their care needs, functional capacity, and health conditions. The higher the care needs, the higher the government subsidy paid to the facility. This means the funding automatically reflects what each resident actually needs, rather than a one-size-fits-all payment.
What the AN-ACC Subsidy Covers
- All clinical nursing care — delivered by Registered Nurses and enrolled nurses
- Personal care — bathing, dressing, grooming, continence management
- Allied health services — physiotherapy, occupational therapy, podiatry
- Medication management and clinical oversight
- Dementia and behaviour support
- AN-ACC rates are updated annually on 1 October each year
What Residents Pay: The Two Fee Systems in 2026
From 1 November 2025, two different resident contribution frameworks operate side by side in Australian residential aged care. Which one applies to you depends entirely on when you entered care.
| Entry Date | Framework | Care Contribution | Cap |
|---|---|---|---|
| 1 July 2014 – 31 Oct 2025 | Old arrangements | Means-Tested Care Fee (MTCF) | $35,910.43/yr | $86,185.23 lifetime |
| From 1 Nov 2025 | New arrangements | HSC ($22.15/day cap) + NCCC ($107.32/day cap) | NCCC lifetime cap $135,318.69 |
Both groups pay the same Basic Daily Fee of $66.80 per day (from 20 March 2026) and the same accommodation costs. The key difference is in how the income-and-assets-based care contribution is calculated.
Understanding the New Fee Types (Post-November 2025)
Hotelling Supplement Contribution (HSC)
- Covers: meals, cleaning, laundry
- Daily cap: $22.15/day
- Means-tested — income and assets
- No lifetime cap
Non-Clinical Care Contribution (NCCC)
- Covers: personal care, independence support
- Daily cap: $107.32/day
- Lifetime cap: $135,318.69
- Stops after 4 years or lifetime cap
Support at Home Funding Levels 2026
The Support at Home programme replaced Home Care Packages on 1 November 2025. It has eight funding classification levels based on assessed care needs — with annual government funding ranging from $11,795 at the lowest level to $78,106 at the highest. Services are grouped into three categories, each with different co-contribution rules.
| Level | Annual Funding | Care Needs |
|---|---|---|
| Level 1 | $11,795 | Low — occasional help at home |
| Level 2 | $16,147 | Mild — some regular support |
| Level 3 | $22,068 | Moderate needs |
| Level 4 | $31,010 | Moderate to high needs |
| Level 5 | $40,514 | High care needs |
| Level 6 | $52,500 | High care needs |
| Level 7 | $65,583 | Very high care needs |
| Level 8 | $78,106 | Highest care needs |
Important from 1 October 2026: Personal care services — including showering, dressing, and continence care — will become fully government-funded under Support at Home with zero co-contribution required. This means funding previously used for personal care co-contributions can be redirected to other services in your budget.
How the Means Assessment Determines Your Contribution
Before entering aged care, you are strongly encouraged to complete a formal means assessment through Services Australia. This assessment looks at your income and assets to determine how much you are expected to contribute toward your care and accommodation costs. Without a means assessment, you will automatically be charged the maximum rates — so completing it is almost always in your financial interest.
| Your Financial Situation | What the Government Covers | What You Pay |
|---|---|---|
| Full pensioner — income below $35,313/yr, assets below $64,500 | Full accommodation + most care costs | Basic Daily Fee only (~$66.80/day) |
| Part pensioner — between thresholds | Partial accommodation + partial care subsidy | Basic Daily Fee + assessed contributions |
| Self-funded — income above $86,185/yr, assets above $214,884 | AN-ACC care subsidy only | Full accommodation + maximum care contributions |
Key Changes to Aged Care Funding Under the New Act
The Aged Care Act 2024 introduced the most significant changes to aged care funding in Australia in nearly 30 years. Here is what changed from 1 November 2025 and what is still coming.
How to Access Aged Care Funding in Australia
Accessing government-funded aged care follows a clear process. The earlier you start, the more options you have — and the shorter your wait for services. Here is the step-by-step pathway.
Frequently Asked Questions — Aged Care Funding in Australia
How does the government fund aged care in Australia?
The Australian Government pays subsidies directly to registered aged care providers on behalf of each eligible resident. For residential care, this is the AN-ACC subsidy — calculated based on each resident’s assessed care needs. For home care, it is the Support at Home programme funding — allocated across 8 levels. Residents contribute what they can afford based on a means assessment by Services Australia.
What is AN-ACC in aged care funding?
AN-ACC stands for Australian National Aged Care Classification. It is the system used to calculate the government subsidy paid to residential aged care facilities for each resident. Every person entering permanent residential care has an AN-ACC assessment that classifies them into one of 13 classes based on their care needs — determining the level of funding the facility receives on their behalf.
What replaced Home Care Packages in 2025?
Home Care Packages were replaced by the Support at Home programme on 1 November 2025. Support at Home has 8 funding levels (compared to 4 under the old system), with annual government funding up to $78,106 at the highest level. Services are now grouped into Clinical (fully government-funded), Independence, and Everyday Living categories.
Do I have to pay for aged care if I receive the Age Pension?
Yes — but the amount is significantly reduced. Full Age Pensioners with limited assets typically pay only the Basic Daily Fee ($66.80/day from March 2026) and a minimal care contribution. The government covers accommodation costs entirely for residents with annual income below $35,313 and assets below $64,500. Always complete a means assessment with Services Australia before entering care.
What is the NCCC in aged care?
The NCCC (Non-Clinical Care Contribution) is a means-tested fee paid by residents who entered care from 1 November 2025. It covers personal care and independence support services. The daily cap is $107.32 and the lifetime cap is $135,318.69 — after which the NCCC stops completely. It is not a government funding stream; it is the resident’s contribution toward their non-clinical care costs.
How do I find out what aged care funding I am entitled to?
Contact My Aged Care on 1800 200 422 to register and arrange an assessment. Once assessed, complete a means assessment with Services Australia on 1800 227 475 — this determines your exact fee contributions. Services Australia will then send a formal fee advice letter that your provider must use when calculating your charges.
Aged Care Funding in Queensland: What Families Need to Know
Aged care funding in Australia is administered federally — the same rules, the same assessment process, and the same fee structures apply whether you are in Brisbane, the Gold Coast, or anywhere else in the country. Queensland families do not have a separate state-level aged care funding system to navigate.
What does vary in Queensland is the cost of accommodation — particularly the Refundable Accommodation Deposit (RAD) set by individual providers. In Brisbane’s South East and on the Gold Coast, RAD prices for quality residential aged care homes typically range from $280,000 to $750,000 depending on the facility, room type, and location. The government covers accommodation costs entirely for residents who pass the low-income means test.
For Queensland families navigating the aged care funding process, the most important practical steps are completing the My Aged Care assessment and the Services Australia means assessment before making any provider decisions. These two assessments give you the complete picture of what you will pay — and what the government covers — so you can make a confident, informed choice about which facility is right for your family.
Understanding Aged Care Funding — And What Comes Next for Your Family
Aged care funding in Australia is more generous than most families realise before they go through the process. The government contributes the majority of the actual cost of care — through AN-ACC subsidies in residential settings and Support at Home programme funding for home care. The means-tested contribution system ensures that families pay according to their financial capacity, not according to the full market cost of care.
The 2025 reforms have made the system more transparent and, for many families, more affordable — particularly with clinical care now fully government-funded and personal care moving to zero co-contribution from October 2026. The introduction of government price caps from July 2026 will further protect families from excessive provider charging.
Understanding how the funding works is the first step. Choosing the right provider — one who is transparent about fees, operates above the minimum care standards, and genuinely cares about the people in their facilities — is the next.
At Superior Care Group, we have been supporting Queensland families through the aged care funding process since 1979. Our two family-owned residences — Wellington Park in Wellington Point, Brisbane’s South East, and Merrimac Park on the Gold Coast — provide full transparency on all fees and costs. We work with families from the very first enquiry through to settling into care, including guidance on the My Aged Care process, the means assessment, and understanding what government funding covers for your specific situation.
We welcome families who want to understand the numbers clearly before making any decisions. There is no pressure, no obligation — just honest information from a team that has been navigating aged care funding in Australia for over 45 years.
Talk to Our Team About Aged Care Funding in Queensland
Wellington Park — Wellington Point, Brisbane South East | (07) 3822 1876
Merrimac Park — Merrimac, Gold Coast | (07) 5618 1111
