Radio 2moro Sawtelghad – Arabic Radio
E & OE
HOURANI:
Senator Mitch Fifield is on the show today to talk about the changes to aged care system. Senator Mitch Fifield, thank you for taking the time to speak to us this morning, and good morning.
FIFIELD:
Good morning, good to be with you Suzan.
HOURANI:
First of all, can you give us a bit of an idea of how many Australians are in residential aged care, and how many receive home care.
FIFIELD:
There are about 180, 000 people in residential care and over 80,000 people in home care. One of the things that often surprises people in relation to aged care is that only about 5% of the population over 65 are in residential aged care.
HOURANI:
Why is that? Maybe because people love to stay at home?
FIFIELD:
That’s exactly right. People want to stay at home for as long as possible. And the trend is moving ever more in that direction. Which is one of the reasons why, in the budget, we announced that we are going to have 80,000 extra home care packages over the next ten years.
HOURANI:
Senator, let me be frank with you. Many Arabic listeners have no idea about the changes, except for the basic news we translated from the press releases your office sent to us, and information in newspapers that we translated and delivered to them. Let me say to you, Minister, many of them are confused and frightened. Can you highlight what are the new changes that came into effect on the First of July, and how will it affect them? As some are confused that they might be worse off.
FIFIELD:
Sure. I’m the first to admit that aged care is a complex area. And many families who have a member who has had to seek age care will say that it can be a challenge to navigate. But the first point to make is that the changes from 1 July only apply to people entering residential care or receiving home care from the First of July. So anyone who was receiving residential aged care support or home care support before the First of July – their circumstances don’t change at all. So it’s only for people coming in after the First of July.
HOURANI:
So they’re not obliged to move into the new system?
FIFIELD:
No, that’s right. They do have the option, if they want to, to leave their current care arrangements for 28 days, and if they do that, they can then come into the new arrangements if they think the new arrangements suit them better. But there’s no compulsion on them to do so. Arrangements for people already in aged care before 1 July don’t change. I might just take you quickly through the main changes if that would be a help.
HOURANI:
Please do.
FIFIELD:
There are a few, I guess what you might call structural changes at the outset. The first of those is that we’re removing the distinction between high care and low care in residential aged care. Previously, someone could only, if they chose, pay a lump sum towards their accommodation for low care. By removing that distinction between high care and low care, that will give consumers greater choice as to how they will pay for their accommodation. So people will now have the option of paying a lump sum or a daily fee, or a combination of the two.
HOURANI:
This is their option – they can choose whatever?
FIFIELD:
That’s right. It’s their option. And in fact the law will allow them 28 days after they move into a setting to make that decision. So that’s the first and a significant change. Also there are new means testing arrangements coming in. Previously, under the old arrangements, assets were only considered in relation to what you might pay for your accommodation. And income was only considered in relation to what you might pay for your care. So you had a situation where some people who had high assets were paying very little for their care, and some people who had high income were paying very little for their accommodation. So we’re moving to a new combined assets and income test. So it’s a new means test.
HOURANI:
Okay, fair enough. So it’s going to combined for the assets and the income as well.
FIFIELD:
That’s right. And I guess there are three categories of people. Those of low means, those of moderate means and those of higher means. So for people of lower means, those with assets below$45,000 and income below $24,000 – people in that situation will only have to pay a basic daily care fee which is set at 85% of the age pension. So that’s the only contribution that people of low means will make. Their accommodation costs will be fully covered by the government. For people of what you might call moderate means – those people with assets above $45,000 and income above $24,000 – they will pay that basic care fee, 85% of the age pension. But they’ll also make a contribution to their accommodation, and the government will also make a contribution to their accommodation. For those people of higher means – people with assets above $154,000 and income above $63,000 – those people will pay the basic care fee, they will also pay a means tested care fee on top of that, and they will also be responsible for all of their accommodation costs.
HOURANI:
So can we say that the means test means everything in this way?
FIFIELD:
The means tested care fee will only apply to people of higher incomes and of higher assets. But it’s important to point out that in relation to that means tested care fee, there are some protections. So there is an annual cap of $25,000 – that’s the most that anyone will pay in relation to that means tested care fee – $25,000 a year. And there’s also a lifetime cap of $60,000. And that lifetime cap covers both residential care and home care. So if someone was in home care and paying fees, and then moves into residential care, the means test care fees they had to pay in home care will be counted towards that $60,000 lifetime cap.
HOURANI:
Thank you for explaining all that. But it’s still very confusing to people. For people who want to have any information – is it available to them?
FIFIELD:
Yes. A good place to go is the My Aged Care website, which is myagedcare.gov.au. There’s also a help line so people can talk to a real life human being…
HOURANI:
Good to hear that!
FIFIELD:
…on 1800 200 422. And an important feature of the My Aged Care website is the Fee Estimator. So people will be able to plug in their assets. They’ll be able to plug in their income. And they’ll get a good handle on what they’re likely to be liable for in relation to care fees and also what they’re likely to be liable for in relation to accommodation.
HOURANI:
So all the information is there on the website?
FIFIELD:
That’s right. And there’s also a lot of information from individual aged care providers about their product offerings and the price of their services. But I think the important thing is for families to start having a conversation about aged care before they get to the critical point where finding support becomes urgent. It’s much easier to think and talk about these things before you’re at that urgent point.
HOURANI:
Senator, is the family home exempt from the means test?
FIFIELD:
The family home – if it’s occupied by a spouse or what’s called a protected person which is essentially someone who’s dependent on you – if the family home is occupied by one of those people, then it’s completely exempt from the means test. If the family home isn’t occupied by one of those people, it is included in the assets test, but the value of the home is capped at $154,000. So it’s not included in the assets test if your spouse lives there. If that’s not the case, there’s a special treatment for the family home so its value is capped for the purposes of the means test at $154,000.
HOURANI:
And I think we know now that the new system doesn’t affect those who are already in accommodation, and this is for people who will join starting from the First of July. I would like to thank you very much for your time with us today.
FIFIELD:
Great to talk.