Menarock

Understanding the costs in aged care

There are three types of fees that residents may be required to pay when living in Australian Residential Care, Daily Fees, Accommodation Payment/Charges, Means Tested Fees. Every person entering care has individual financial circumstances which are taken into consideration to ensure everyone has access to Aged Care in Australia.

Daily Fees


Basic Daily Care Fee

  • This is a compulsory fee, all persons residing in residential aged care are required to pay this, including full pensioners, part pensioners and self-funded retirees.
  • The fee is set by the government at approximately 85% of the single Australian Aged Pension.
  • This fee adjusts by a small margin bi-annually in line with rises in the Australian Aged Pension.

Means Tested Care Fee (MTCF)

  • This is a government required contribution towards care from those who can afford it.
  • It is based on an assessment of an individual resident’s income and assets.
  • Services Australia determines if a resident is required to pay this and how much it will be.
  • Notification if a MTCF is payable and of how much, is provided to residents in their initial and any subsequent Centrelink/DVA Assessment Advice letters.
  • There are yearly and lifetime Maximum Means Tested Care Fees and the cap is indexed. To find out more about Means Tested Care Fee Caps: Schedule of Fees and Charges for Residential and Home Care: From 1 January 2022

Accommodation Payment


  • The payment method is chosen by the resident and Accommodation Payment amounts vary depending on the room price; known as the Refundable Accommodation Deposit (RAD), for the type of room accommodation the resident chooses.
  • RAD’s are published on My Aged Care and our website.

Refundable Accommodation Deposit (RAD)

  • A one-off lump sum payment made to the aged care provider.
  • The RAD is fully refundable on departure, less any amounts you may have agreed to have deducted.
  • RAD’s will be refunded within 14 days of departure for those residents transferring to another aged care residence or returning to home.
  • The RAD is protected by the Aged Care Act, 1997 (Commonwealth).

Daily Accommodation Payment (DAP)

  • Residents can elect to pay their accommodation payment by the DAP method.
  • This is an ongoing payment calculated to a daily rate based on the RAD lump sum value of your chosen room.
  • Services Australia determines if a resident is required to pay this and how much it will be.
  • A DAP calculation is made by multiplying the residents chosen room RAD by the governments legislated interest rate applicable to residential aged care. This is known as the maximum permissible interest rate (MPIR).
  • Residents choosing a DAP as their preferred payment method do not receive a refund when they depart residential aged care.

Combination Payment (RAD + DAP)

  • Residents can choose to pay part of the accommodation payment as a lump sum RAD and the remainder as a DAP payment.
  • DAP payments will be calculated based on the outstanding RAD amount at the applicable legislated residential aged care interest rate.
  • If you choose a combination of RAD and DAP and to have the DAP deducted from the RAD, your DAP payment will increase over time and the RAD amount will reduce.
  • Any remaining RAD portion is fully refundable upon the resident’s departure.

Government Supported Accommodation Payment

Partially Supported Government Accommodation

  • Partially supported government accommodation is where a resident is required to make a contribution to their accommodation.
  • Eligibility is based on an assessment of an individual resident’s income and assets.
  • Services Australia determines a resident’s eligibility and if eligible, how much contribution a resident is required to pay.
  • Notification of eligibility and contribution details is provided to residents in their initial and any subsequent Centrelink/DVA Assessment letters.
  • For contact details of these government departments, take a look at Menarock LIFE’s Key Steps and Useful Resources in your information pack.

Fully Supported Government Accommodation

  • Fully supported government accommodation is when no payment for accommodation is required by the resident.
  • Eligibility is based on an assessment of an individual resident’s income and assets by the Department of Human Services.
  • Notification of eligibility is provided to residents in their initial and any subsequent Centrelink/DVA Assessment letters.

Need more information?

Contact our friendly and experienced Client Services Team on 1300 096 971 or email enquiries@menarock.com.au
The best way to find out if our homes are suitable for your loved ones is to come in and visit. To get started, contact us today!