Written by Former Hudson Report Editor Hayley McLeod
Two years ago, my 58-year-old father was diagnosed with early onset Alzheimer’s. This came as quite a shock to my sister and I and left us both wondering how to care for his future needs. I have a young family of my own and the thought of having to plan to look after my father at the same time was daunting and overwhelming.
As parents age it is often left up to someone else, usually their children, to plan for future care. Since my father’s diagnosis I have learnt that this is not an easy journey.
My father was made medically redundant from his job, so my first step was to ensure that he had an income. Due to his age he is not entitled to an age pension and Centrelink wanted to put him on Newstart (with a work exemption clause). The fact that Alzheimer’s is a lifetime disability did not seem to be important to Centrelink. Several phone calls and a complaint lodged with the Ombudsman led to Centrelink offering my father a lifetime disability pension. Dealing with the beau acracy at Centrelink was one of the most stressful times in my life. The paperwork and loopholes that they make you go through can lead even the calmest people to near insanity. Do NOT be afraid to take any complaints you have to the Ombudsman if you believe that you are being unfairly treated.
Step two was to ensure that he had enough income and assets for future care. I am going to pretext this next section with I AM NOT A FINANCIAL PLANNER, what I did next is entirely a personal scenario. I had set up my father’s Will and an Enduring Power of Attorney before his diagnosis as I had previously worked in the legal profession and knew how important such documents were as my parents aged. Due to my father’s diagnosis I invoked my Enduring Power of Attorney status and took control of all financial and medical matters relating to his future care. My father and I have always had a good relationship and not everyone can invoke their Enduring Power of Attorney status as easily as I did. When I had the paperwork drawn up, I added my sister and I as power’s off attorney joint or severely, which means there is a strong element of trust within our family. Every family is different, and I would encourage people to seek legal advice when setting up such paperwork.
Having power of attorney means that I was able to ensure that my father’s disability pension covered his current and future medical expenses and he can pay down his mortgage. I have a renovation background so my husband and I renovated my father’s house, adding value with the intent that within the five year time frame we were given before he needed full time care, his house would increase in value while he paid off his mortgage. Pensioners are also able to earn a small income (check Centrelink websites for limits as these do change regularly) to help supplement their pension.
As people age it is imperative to plan for future care and ensure a stable and reliable future income whether it be as a self-funded retiree or from government benefits. This is a plan that needs to be discussed early on in life because, as in my dad’s case, you never know when your current income will come to an end.
Step three is to plan for how much money you will need for future care and what future care may look like. Being under 65 my father isn’t entitled to any of the care provided by “My Aged Care” we had to apply for an NDIS funding package. Again, this process can be extremely daunting and time consuming. I will take you through both scenarios.
Under 65 and requiring care:
You will need to apply for the Commonwealth Home Support Programme. The aim of this programme (CHSP) is to help keep senior Australians at home for as long as possible and for them to access entry-level support services to live independently and safely.
Eligibility for this program is based on your support needs and age.
- You must be 65 years or older (50 years or older for Aboriginal or Torres Strait Islander people), or
- 50 years or older (45 years or older for Aboriginal and Torres Strait Islander people) and on a low income, homeless, or at risk of being homeless.
(*Check eligibility: https://www.myagedcare.gov.au/assessment/apply-online)
If your needs are more complex, a Home Care Package could be better suited to you (https://www.myagedcare.gov.au/help-at-home/home-care-packages).
- You may also need to undertake an ACAT assessment, which I will discuss later.
If you are under 65:
Your best course of action if you are under 65 and require significant assistance is to apply for NDIS. The National Insurance Disability Scheme was established to fill the gap for those needing care under 65. There is a strict eligibility process in place (https://www.ndis.gov.au/applying-access-ndis/am-i-eligible) but once you have been granted a funding package the help available can be amazing and you can have a plan manager take care of everything for your or you have the option of managing your package on your own. Unlike Centrelink, NDIS personnel will help you with your paperwork and will walk you through the process of finding support providers.
Unfortunately, despite the fantastic packages and services available there may come a point when your loved one may require more care than can be provided at home, which leads me to step four and this is one of the hardest steps for most families. I know my father will need care in around 3-5 years. I have planned for this. I will NOT let him go into a Government run facility and instead have structured his financial situation to cater for high care within an independent living facility. I can hear many of you saying…. “Well I definitely won’t be able to afford that”, or “those places take all of your money”. Yes, they can be expensive, but the alternative is for people (your parents) to be placed into a facility, not of their choosing, where they will live out their lives in a hospital bed and shared room.
Here are your options:
When you, or a physician, require permanent care for someone there are varying levels of services offered in aged care homes. Some provide continual nursing care, while others provide mainly accommodation and personal care, with occasional nursing care.
Some facilities specialise in looking after people with specific needs, such as people with dementia. Some facilities also provide palliative care for people who have a life-limiting illness to maintain the best possible quality of life.
Before searching for access government-funded aged care services your loved one will need to be assessed. This is called an ACAT Assessment (Aged Care Assessment Team). This will determine the level of care required. This can take up to 6-12 weeks. So be prepared for a wait. The level of care that is ascertained will then determine the type of aged care facility you are looking for.
Low care facilities are for seniors who are able to take care of their daily tasks and require little help and assistance, whereas high care facilities are for people with higher needs and people who cannot move around or perform daily tasks such as bathing and showering without help.
How does it work?
The Australian Government subsidises a range of aged care facilities and services in Australia. This means affordable care and support services can be accessed by those who need it.
What is the difference between a Government funded facility and a private aged care facility?
- Receive subsidies to make care more affordable
- Regulated by the Australian Government
- Independent accreditation through the Aged Care Quality and Safety Commission (ACQSC)
- Some places may not be subsidised
You can find a list of subsidised aged care homes on this website using the Find a provider (https://www.myagedcare.gov.au/find-a-provider/).
There are often waiting lists associated with Government funded facilities and you don’t often get a choice in the facility that is offered to you.
- Private aged care homes don’t receive subsidies from the Australian Government
- Retirement homes or independent living units don’t necessarily provide care services
- Retirement homes are regulated by state and territory governments
Private aged care homes and retirement homes aren’t listed on this website, but you can read more about them on the following website (https://www.agedcareguide.com.au/).
What are the associated fees?
Each facility sets their own prices, within a prescribed limit, and costs will vary. Outlays will depend on the place you choose and an assessment of your income and assets. Typically, there are three types of costs associated with all aged care facilities:
A basic daily fee (the maximum is currently $52.25 per day)
A maximum amount that everyone pays for the services they receive.
A varying cost for your room based on a means assessment.
Means-tested care fee (the maximum is currently $259.15 per day)
A varying cost for the care services you receive based on a means assessment.
You can get an idea of what you may have to pay by using the residential care fee estimator website (https://www.myagedcare.gov.au/fee-estimator?fe_type_of_care=age_home_care).
Read more about the costs and fees on the aged care homes costs website (https://www.myagedcare.gov.au/aged-care-home-costs-and-fees).
If you choose a privately owned facility you may have to buy into the facility, but this usually means you have the ability to live independently and some offer couples rooms allowing husbands and wives with differing needs to stay together.
My grandfather moved into a high care facility, but he still had his own unit. It was very spacious and had its own garden. The facility itself had a vegetable garden, chickens, a bar (with happy hour), library and dining hall; which allowed family and friends to come for meals. It was fantastic. My kids and I loved going to visit him and he paid for as much or as little care as he required. He paid for this while on a Government pension with the sale of his home paying for entry into the facility and some ongoing services. He was by no means a rich man.
When you are choosing a privately owned facility CHOOSE carefully because if you buy into a low care only facility and need high care within a few years you may found yourself significantly out of pocket.
To see what is available and the costs associated I am going to use Seasons Kallangur (https://seasonsagedcare.com.au/kallangur/) as my example because this is where my grandfather lived. I am in NO way affiliated with or paid by this facility. These are the types of units available: https://seasonsagedcare.com.au/kallangur/wp-content/uploads/sites/5/2020/06/Seasons_Kallangur_Site-plan_4-pp_WEBFinal.pdf
This document (https://seasonsagedcare.com.au/kallangur/wp-content/uploads/sites/5/2020/06/Form-3_RV_Village_Comparison_Document-1-July-2020.pdf) outlines all of their current fees and charges relating to entry and ongoing fees. Entry into the facility is currently around $210,000. This is a high care and low care facility.
There are also exit fees attached to these types of facilities and they can be significant, depending upon how long you have lived in the facility. They are also outlined in the above document.
If you do not want you or your family member to be placed into a Government funded facility then these are the types of fees and charges you are looking at.
How do I find a facility?
While some facilities list their vacancies or the units, they have for sale on their own private websites’ others may require a phone call. There is a website called aged care guide that also has listings throughout Australia. https://www.agedcareguide.com.au/. I encourage you to visit these facilities and talk to the residents before buying in. It is also a good idea to go during mealtime to see the food options available.
How can Hudson help?
We understand that most families lead busy lives and taking on the role of placing a loved one into care can be stressful and time consuming, but we can help. There are several ways in which Hudson Financial Planning can assist you with your retirement planning and aged care needs. When it comes to moving into a retirement or aged care facility, we can help alleviate this pressure. For more information please email Hayley McCloud firstname.lastname@example.org
Useful links and contacts
- Retirement planning – Speak to your Hudson Financial Planning Adviser
- Wills and estate planning – Speak to a solicitor that specialises in Wills and Estate Planning. Your local Law Society can point you in the right direction or alternatively you can put your own Will kit together and our own Power of Attorney forms: https://www.qld.gov.au/law/legal-mediation-and-justice-of-the-peace/power-of-attorney-and-making-decisions-for-others/power-of-attorney (Please NOTE this is the QLD version). It is highly recommended that you seek advice from a solicitor and make copies of any paperwork and ask someone you trust to keep it in a safe place. Be careful of lodging any documents with the Public Trustee or making them the executor of your will as they will take a fee.
- NDIS – https://www.ndis.gov.au/
- Centrelink Aged Care/Pension Information – https://www.servicesaustralia.gov.au/individuals/services/centrelink/age-pension
- My Aged Care – https://www.myagedcare.gov.au/
- Find and aged care facility – https://www.agedcareguide.com.au/