Previously, we communicated with you the different assistance programs that the Queensland Government has in place to help those over 60 to maintain or regain independence at home.
Let’s take a deeper dive and explore alternative Home Care Packages (HCP) and how they provide subsidised home care services for older clients who want to remain in their home.
While most clients who require care prefer to stay in their home, they may find this can be very difficult when their care needs are high and Government funding is insufficient to provide the home care services needed.
Over time we have seen the number of HCPs has continued to increase to the extent that as of 30 September 2023, there were approximately 264,000 people in receipt of a HCP, an increase of 17% over the preceding 12-month period. The number of HCPs is expected to continue to increase each year and with a strong preference for clients to remain at home for as long as possible.
Throughout this article HCPs are explained in how they are provided, how they are funded and includes strategies that can maximise cash flow and allow a client with care needs to remain in their own home as long as possible.
How are Home Care Packages provided?
HCPs are offered on a consumer directed care basis. This gives clients more choice for home care services and control over how they are delivered. Providers work in partnership with clients to develop a home care plan that will meet their care needs. Clients can choose their provider and direct the Government subsidies and supplements to that provider. In addition, all HCPs are portable giving clients the flexibility to change providers and transfer unspent funds accordingly. To access HCP, clients are first assessed by the Aged Care Assessment Team (ACAT), which determines eligibility. Once assessed as eligible for home care, a client is placed in the National Priority System and is assigned an HCP when one becomes available (see below).
Interaction with the Commonwealth Home Support Programme
Clients whose needs are not complex can access subsidised home support services via the entry level Commonwealth Home Support Program (CHSP). Unlike HCPs and permanent residential aged care, there is no Centrelink/DVA means test. Instead, there are established guidelines within the Client Contribution Framework to assist service providers with determining suitable amounts to charge, as well as how these amounts are collected, based on their business and the services provided. Clients will therefore need to discuss and agree to any fees with the service provider before they start receiving these services.
National Priority System (NPS) and waiting times
The NPS is essentially a queue which considers two factors:
The client’s priority for home care services as determined by the ACAT during the assessment.
The date the client was approved for home care at a specific package level. Due to the dynamic nature of the NPS, the client’s position in the queue is not available. Once the client has been allocated an HCP, they usually have 56 calendar days, however, a further 28-day extension can be requested allowing for a total of 84 calendar days to enter into an agreement with a service provider.
The estimated wait times for clients with medium priority as of 31 January 2024 to be allocated an HCP for particular levels are:
HCP Level Time to approve HCP
Level of HCP Assessment | Wait Time |
1 | Less than 1 month |
2 | 3 – 6 months |
3 | 6 – 9 months |
4 | 3 – 6 months |
There is seemingly more demand for Level 3 HCPs than available packages with clients waiting the longest for a Level 3 HCP.
Interim package assignment
Clients have the option to indicate if they are willing to accept a package at a lower level than their approved level, as an interim arrangement, while waiting for their approved package level. If a client is willing to receive an interim level package it does not mean they will wait longer to receive a package at their approved level and has no impact on their wait time for their approved package level. An interim level package simply allows the client to access care and services while they remain in the queue for their approved package level. Once a package becomes available at a higher package level, it will be assigned to the client and accepted automatically.
The vast majority of clients waiting in the queue without an interim HCP are approved for CHSP. As of 30 September 2023, there were 41,950 people in the NPS who were waiting on a HCP at their approved level. While they were waiting, approximately 9,500 had been allocated an interim HCP with the remaining people, waiting to be offered an interim HCP.
How many hours of care can be received?
The amount of hours which could be funded through HCPs is variable on several factors such as the hourly charge for services, whether a basic daily fee is paid as well as care and package management costs. According to COTA, on average, HCPs can allow for care to be provided from anywhere from 2 to 13 hours per week depending on the HCP level.
Level of Funding | Hours per Week |
1 | 2 hours |
2 | 3 – 4 hours |
3 | 7 – 9 hours |
4 | 10 – 13 hours |
which may be beneficial in comparing different service providers when providing identical services. Given that average age of receiving an HCP is approximately 81, based on many discussions with advisers, it is apparent that for many clients, HCP funding is insufficient to fund the amount of care they need. Any additional hours of care which are outside the HCP budget are either required to be topped up by informal care through family and friends or through the purchase of additional services.
The stark reality is that for some clients with intensive care needs, especially if they do not have enough available funds nor the support of unpaid informal care, entry into an aged care facility may be required. To assist with ensuring that HCP funding is retained to provide for the provision of care, from 1 January 2023, there is a capping on administrative charges that service providers pass onto clients. Care and package management costs are capped at 20% and 15% respectively of the HCP basic subsidies. Further, exit fees cannot be charged if the client wishes to change service providers.
Client’s contribution
Clients may be asked to contribute a basic daily fee and for those who have assessable income over certain thresholds, an income-tested care fee, towards their HCP. The Basic Daily Fee (BDF) can range from $11.22 to $12.53 per day, depending on the HCP Level. With agreement of the service provider, this fee can be waived. If a BDF is paid, the amount is in addition to the HCP funding from the Government and therefore, can allow for higher care hours.
Basic Daily Fee
Minimum Basic Daily Fee | Minimum Annual Amount | |
1 | $11.22 | $4,095.30 |
2 | $11.97 | $4,332.55 |
3 | $12.20 | $4,453.00 |
4 | $12.53 | $4,573.45 |
The income-tested care fee is determined by a client’s assessable income. Once the assessable income exceeds certain thresholds, a client pays an income-tested care fee subject to a daily, annual and lifetime cap ($78,525 as of 20 September 2023).
Assessable income includes income as assessed under social security rules and any Age Pension entitlement (excluding the minimum Pension Supplement and Energy Supplement). The income-tested care fee is calculated by Services Australia and is reviewed monthly. The amount of income-tested care fee payable reduces the amount of subsidy and primary supplements provided by the Government.
The information quoted and provided in this article is from Challenger’s Technical Services Manager and current as of March 2024. For further information please contact your trusted financial adviser.