What is Residential Living?
Who is eligible for Residential Living?
What is an "Accommodation Payment"?
What is a “Basic Daily Care Fee”?
What is a “Means Tested Fee”?
Who should pay the Accommodation Payment?
When must the Accommodation Payment be paid?
What happens to the Refundable Deposit monies?
Who should sign the Resident Accommodation Agreement?
When does a Guarantee and Indemnity Deed need to be executed?
When are Accommodation Deposit monies refunded?
What restrictions are there on residents having someone else to stay with him/her?
What restrictions are there to having visitors?
Can my Accommodation Agreement be terminated?
How does the Medical Expenses Tax Offset reduce my net cost?
What are my legal entitlements?
What is Residential Living?
Residential living provides required assistance with personal care and daily living activities for people assessed by the Commonwealth for approved funding for such care. This includes things like assistance in showering, dressing or administering medication.
Who is eligible for Residential Living?
Commonwealth Aged Care Act requires that entry into Residential Living is on a needs basis and assessment is required. The assessment is conducted by an Aged Care Assessment Team (ACAT). These Teams are attached to most public hospitals.
What is an "Accommodation Payment"?
Depending on your income and assets you may be asked to pay an Accommodation Payment for entry into residential living. This can be paid as a Refundable Accommodation Deposit (RAD) OR as a Daily Accommodation Payment (DAP) OR as a combination of both.
If the resident moves to another facility, the RAD will be refunded within the time-frame set up by the government.
What is a “Basic Daily Care Fee”?
Daily Care Fees are your contribution to your daily living costs, such as meals, linen and laundry, as well as heating and cooling. Daily Care Fees include a Basic Daily Care Fee (with a maximum set by the Government) for some residents this maybe the only fee payable. Daily Care Fees are indexed and may increase in line with changes to the age pensions and the Consumer Price Index.
What is a “Means Tested Fee”?
Depending on your income and assets you may be asked to pay a means tested care fee. This is an additional contribution towards the cost of the care that some people may be required to pay. It contributes to your day-to-day care costs such as nursing and personal care.
The amount you pay will depend on your income and assets, however, there are limits in place. If you are not required to pay the means tested care fees, the Australian Government will pay the full cost of your care. There are annual and lifetime caps that apply to the means tested care fees. Once these caps have been reached you can not be asked to pay any more means tested care fees.
Who should pay the Accommodation Payment?
Residents of Pines Living who have had their income and assets assessed as over the allowable threshold by the Australian Government will be asked to make an Accommodation Payment as either a RAD (Refundable Accommodation Deposit) or a DAP (Daily Accommodation Payment) or a combination of both. Details of these amounts are provided in each individual’s accommodation agreement.
If a resident obtains a loan from a third party to enable them to pay the Accommodation Payment, it is advisable that the resident obtains legal advice before entering into a formal loan agreement between the resident and the lender.
DAP is payable monthly, calculated equal to interest on the unpaid RAD amount. Interest rate is fixed by the Department of Health. At Pines Living RAD is $550,000. Current Maximum Permissible Interest Rate (MPIR) is 4.02%.
At exit, RAD is refunded, while DAP is not because DAP is interest only on unpaid RAD amount. Current Base Interest Rate (BIR) is 2.25%
Pines Living pay interest to residents at two different rates. Interest must be paid to the resident on the same day that the refundable deposit balance is refunded, at the base interest rate (BIR) for refundable deposit, whichever of the following periods comes first:
- between the day after the resident dies or leaves the Pines Living service and the date the refundable deposit is refunded, or
- between the day after the resident dies or leaves the Pines Living service and the end of the legislated timeframe for refund (14 days after Pines Living has been shown probate or notice of moving to another service) of the refundable deposit, at the maximum permissible interest rate (MPIR),
- between the end of the legislated timeframe for refund of the refundable deposit and the day refundable deposit balance is actually refunded.
When must the Accommodation Payment be paid?
Whether a resident has chosen to pay their Accommodation Payment as a RAD or by way of a DAP or as a combination, these sums are due and payable on and from the date specified in the Resident Accommodation Agreement. This Agreement is signed prior to entering the Pines.
If a resident is unable to pay RAD upon entry into an aged care facility, a DAP is payable until the RAD is paid in full.
Where a resident has elected to pay by way of a DAP, payment will be due on a 28 day accounting period.
What happens to the Refundable Deposit monies?
The Accommodation Payment monies received from residents are managed in accordance with the prudential requirements stipulated under the Aged Care Act 1997, which allows for Accommodation Payment monies to be used to reduce debt, make improvements to existing facilities and/or to acquire or build new aged care facilities. In essence, all Deposit monies are kept within the sphere of Pines business to make possible the improved facilities which residents are now able to enjoy.
Who should sign the Resident Accommodation Agreement?
All residents who are capable of doing so should complete and sign their Resident Accommodation Agreement. People who have been granted power of attorney by a resident may sign the agreements for and on behalf of the resident. Independent legal advice should be sought prior to completing Resident Accommodation Agreements. These Agreements are signed prior to entering the Pines.
When does a Guarantee and Indemnity Deed need to be executed?
Where a resident is not capable of signing a Resident Accommodation Agreement themselves, the Deed of Guarantee and Indemnity must be completed. In most circumstances, the individual who has been granted power of attorney by the resident will be the appropriate person to execute a Deed of Guarantee and Indemnity. Independent legal advice should be sought prior to the execution of a Deed of Guarantee and Indemnity.
When are Accommodation Deposit monies refunded?
Refunds of the RAD will be made within the time-frame specified by the government.
What restrictions are there on residents having someone else to stay with him/her?
Unless approval is given by Pines Living, no other person may live with the resident.
What restrictions are there to having visitors?
There are no specified visiting hours, but we ask that you respect the rights of other residents. For similar reasons, residents are not permitted to keep pets in the facility.
Can my Accommodation Agreement be terminated?
Residents may at any time vacate the accommodation upon giving 7 days notice in writing. The conditions for vacating your accommodation are fully described in the Resident Accommodation Agreement (which complies with the provisions of the Aged Care Act 1997).
How does the Medical Expenses Tax Offset reduce my net cost?
If you are liable to pay residential aged care fees, you may be entitled to the Medical Expenses Tax Offset, which is an offset from tax for residents who are assessed as requiring assisted care living.
Your accountant or taxation advisor would be the best person to advise eligibility for this tax off-set.
What are my legal entitlements?
As a resident of a Commonwealth Government subsidised facility you are covered by the Aged Care Act 1997 and the Principles there to. Your rights and responsibilities together with the agreed fees, RAD arrangements and conditions will be set out in a Resident Accommodation Agreement which is signed on entry or shortly after. A standard agreement is available from administration at Pines Living.