Support at Home: What We Know, What We Don't

Home care is undergoing its biggest changes since Consumer Directed Care (CDC) was introduced over 10 years ago. These changes aim to simplify the system, manage costs, and improve services.

• Rising Demand & Costs: As more older Australians seek home care, the government needs those who can afford it to contribute to their non-clinical care costs.
• Simplifying the System: The current setup is confusing, with multiple programs and complex fees. The new system will combine programs and introduce capped pricing for service providers.
• Stronger Regulations: In response to the Royal Commission on Aged Care, the government is tightening laws and making long-overdue improvements to a system designed over 20 years ago.

• New Terminology: “Consumers” will now be called “Participants.”
• Existing Recipients: Those receiving a Home Care Package before September 2024 will not see any increase in personal contributions.
• New Recipients: Anyone entering the system from September 2024 will contribute to non-clinical care costs.
• Service Provider Pricing: Fees will be capped over 18 months, mostly based on hourly unit pricing.
• More Care Hours?: In theory, care recipients should receive more service hours (may not happen until 30 June 2026, with transition loopholes).
• More considered choices: Participants will be personally responsible for covering part of the cost of all non-clinical service costs and are expected to closely review invoices to ensure value for money.

• Care Management Costs:
  • Capped at 10% of the package value and charged hourly.
  • Costs will be pooled across all clients, meaning Participants will no longer see specific care management hours on their statements.
• No More Package Management Fees: These costs will now be included in service pricing under the new price caps.
• Major Business Adjustments: Home care providers will need to restructure their pricing and operations to remain viable.

• Future Hourly Rates for Care Management (post-June 2025), which will impact provider sustainability.
• Price Caps for Services Beyond June 2026.
• How Payments Will Work: It’s unclear how the government will manage service provider payments while factoring in means-tested Participant contributions.
• Industry Impact: With management fees dropping from ~35% to ~20%, some Approved Providers may exit if they cannot adjust to the new pricing structure.

These changes aim to make home care simpler, more transparent, and arguably fairer for Participants.

For the Government, it is cheaper, and more sustainable for taxpayers due to more contributions from Participants,

Service providers face significant challenges as they adapt to new pricing rules.