Since the new Aged Care Act commenced on 1 November 2025, the fees you pay in a residential aged care home are shaped by a means assessment — a combined test of your income and assets that determines how much you contribute toward your care and accommodation, and how much the government pays. Getting this assessment done properly, and early, is one of the most financially significant steps in the whole process. This guide explains how it works.
Why the means assessment matters so much
Residential aged care is jointly funded: the government pays a large share, and residents contribute according to means. The means assessment sets your personal contribution — so two people in identical rooms can pay very different amounts. Until the assessment is done, you cannot know your real costs, and you may be charged as if you had not disclosed your finances. Completing it is not optional if you want the government contribution and the safeguards that come with it.
How to get assessed
The means assessment is handled through Services Australia / Centrelink, using a dedicated income and assets form for aged care (separate from an Age Pension claim, though pensioners’ details are largely known already). You provide details of income (pensions, investments, superannuation in the drawdown phase) and assets (savings, investments, and your former home, treated specially — see below). Submit it before or as close as possible to moving in, because fees can be backdated and uncertainty is stressful.
The three things you may contribute to
- A basic daily fee — a standard contribution to living costs (meals, laundry, cleaning), set as a percentage of the single Age Pension and paid by most residents.
- A means-tested care contribution — an amount toward your care costs that depends on your assessed income and assets. Lower-means residents pay little or nothing here; the government covers it.
- Accommodation payment — for your room, paid as a lump-sum Refundable Accommodation Deposit (RAD), a Daily Accommodation Payment (DAP), or a combination. Whether the government contributes to this, or you pay it in full, again depends on the means assessment.
How the former home is treated
The family home is the question families worry about most. In the aged care means assessment, the former home is generally counted only up to a capped value — not its full market price — and it is exempt entirely while a "protected person" (such as a spouse or a dependent) still lives there. This capped, and often exempt, treatment is deliberately more generous than many families expect, and it is a reason not to rush into selling the home before understanding the assessment.
Annual and lifetime caps
The system includes caps that limit how much you can be asked to contribute to care over a year and over your lifetime. Once you reach a cap, you stop paying that contribution and the government covers it. These caps are a genuine protection against open-ended costs — but you only benefit from them if your contributions are correctly recorded, which starts with the means assessment.
Do the assessment before you commit financially
The single most common expensive mistake is making big financial decisions — selling the house, restructuring investments, choosing how to pay the RAD — before knowing the assessment outcome. Because the home is capped (and sometimes exempt) and because income and assets interact in ways that are not obvious, the assessment result can change what the smartest funding choice is. Get the number first, then decide. Independent financial advice from an adviser who specialises in aged care is well worth its cost at this point.
Short on time? Curalune Care Help (A$149, one-off) reads your situation and emails you an ordered shortlist of 3–5 suitable aged care homes — with contacts, why each one fits and a ready-to-send message — usually within 24 hours.
While the assessment is processing, you can be building your shortlist of homes — so that when the finances are clear you are ready to act, not starting from scratch.
Not sure where to start with the paperwork? Curalune Paperwork Help (A$199, one-off) maps the exact documents to gather, the right order of steps and ready-to-send messages for your case — delivered within 24 hours.
Frequently asked questions
How is what I pay for aged care decided?
By a means assessment of your combined income and assets, run through Services Australia. It sets your means-tested care contribution and whether the government helps with your accommodation. Lower-means residents pay little toward care; higher-means residents pay more, up to annual and lifetime caps.
Will I have to sell my house to pay for aged care?
Not necessarily. In the means assessment the former home is counted only up to a capped value, and it is exempt entirely while a protected person such as a spouse still lives there. Because of this, selling the home is often not required and sometimes not the best move — get the assessment result before deciding.
Are there limits on how much I can be charged?
Yes. The system applies annual and lifetime caps on care contributions. Once you reach a cap you stop paying that contribution and the government covers it. These caps only work in your favour if your payments are correctly recorded, which starts with completing the means assessment.
When should I do the means assessment?
Before or as close as possible to moving into residential care. Fees can be backdated and the outcome can change your best funding strategy, so it is worth completing the Services Australia income and assets form early and getting specialist financial advice before making big decisions.