After lengthy negotiations, the Albanese Government has unveiled a landmark reform package aimed at improving the quality and viability of aged care in Australia. The reform has bipartisan support from the Coalition, and a new Aged Care Act will be introduced into parliament later today.
The $5.6 billion initiative is set to support a growing number of older Australians who choose to maintain their independence and remain in their homes as they age.
A key component of the reforms is the $4.3 billion “Support at Home” program, scheduled to commence on 1 July 2025. This program is expected to benefit around 1.4 million Australians by 2035, helping them to remain in their homes and communities for longer. The new system will provide comprehensive support services, including clinical care, assistance with daily activities, and home modifications. Under this program, the government will cover 100% of clinical care costs, while individuals will contribute to the costs of personal support and everyday living, based on a means-tested assessment.
The reforms respond to recommendations from the Aged Care Taskforce, which advocated for Australians to make reasonable, means-tested contributions towards their care costs. The changes are designed to enhance the quality of care while ensuring that the aged care sector remains financially sustainable.
Support at Home: Greater freedom for older Australians
As preferences shift towards ageing in place, the government aims to accommodate this by investing in the new Support at Home program. It will offer more tailored support with eight different classifications and shorter waiting times for services. Additionally, the program includes funding for home modifications and faster access to assistive technologies, such as walkers and wheelchairs.
Support at Home participants will also be eligible for a 12-week restorative care program following illness or injury, along with up to $25,000 to enable older Australians to spend their final months at home.
Reforms to improve residential aged care
The reform package also includes measures to enhance funding, quality, and viability within residential aged care. With an expected doubling of Australians aged over 65 by 2050, and those aged over 85 tripling, the need for new facilities is critical. To support this, new entrants to residential care will see larger means-tested contributions and an indexed maximum room price.
The “no worse off” principle ensures that those already in aged care or home care will not pay more. Current funding arrangements will remain unchanged for these individuals, while new rules apply only to those entering care from 1 July 2025.
“Reforms like this do not happen every day. They are once-in-a-generation, and my Government is proud to deliver them, as we said we would.”
Prime Minister Anthony Albanese
New laws to protect older Australians
The reforms will be backed by new legislation, including a Statement of Rights for older Australians, stricter accountability measures for providers, enhanced regulatory powers, and whistleblower protections.
The new Aged Care Act is expected to commence from 1 July 2025 with the Support at Home program.
Positive response from providers
“There have been more than twenty reviews of aged care in the last twenty years, but none of them have led to real change. Government after government has failed to act on them. Today, that finally changed with a new Act that delivers on dozens of recommendations from the aged care Royal Commission.”
Anglicare Australia
“We welcome news today of bipartisan support for historic aged care reform. This announcement and progression of the new Aged Care Act through Parliament will provide much-needed certainty, supporting the sector to grow and meet the needs of a booming ageing population.”
Bolton Clarke
“The Aged Care Act is a significant step forward and we see Hall & Prior as the champions of change in this arena. As professionals we will embrace the change as we continue to strive for improvement.”
Hall & Prior Health & Aged Care Group
“These reforms not only provide crucial and sustainable financial security but also confidence for the sector to invest in new programs and care models that have the ability to deliver the quality outcomes that older Australians expect and deserve.”
Benetas
