A New Era for Residential Aged Care in Australia: What Families Need to Know

Australia’s residential aged care system is going through some of the most significant changes in decades. From new funding models and strengthened quality standards to updated resident rights and transparency measures, these reforms will reshape how care is delivered and funded.

For many families, it can be hard to keep up with what’s changing — and what it means for you or your loved one. That’s where Aged Care Simplified can help. We guide families through the evolving aged care system, providing clear, compassionate support so you can make informed decisions with confidence.

Why Is the Aged Care System Changing?

Following recommendations from the Royal Commission into Aged Care Quality and Safety, the Australian Government has committed to a series of reforms designed to make the system more person-centred, transparent, and sustainable.

With an ageing population and rising demand for care, the Government’s Aged Care Reform Agenda aims to ensure that older Australians receive the respect, quality, and safety they deserve — whether they live at home or in residential care.

Key Changes to Residential Aged Care

1. The New Aged Care Act 2024

Coming into effect from 1 November 2025, the new Aged Care Act puts older Australians at the heart of the system. It introduces a Statement of Rights, stronger quality standards, and improved oversight for providers.

Families can expect clearer communication, more consistent care standards, and better protection of residents’ rights.

2. New Fee and Contribution Model

For people entering residential aged care after 1 November 2025, the way fees are calculated is changing:

• Clinical care (nursing, therapy, allied health) will be fully government-funded.

• Non-clinical services (meals, cleaning, laundry) may attract an additional contribution for those with capacity to pay.

• Means testing will be updated to better reflect income and assets, and a lifetime cap on contributions (around $130,000) will be introduced to limit overall out-of-pocket costs.

These updates are designed to make funding fairer and more transparent — but they can also be complex. Aged Care Simplified can help families understand how these new rules apply to their situation, estimate contributions, and prepare the necessary documentation.

3. Accommodation Costs and Refundable Deposits (RADs)

The cap on Refundable Accommodation Deposits (RADs) will increase to around $750,000, reflecting market trends. New rules will also allow providers to retain a small percentage of the RAD over time, but the “no worse off” principle ensures that anyone already in care before the reforms will not be disadvantaged.

If you’re unsure how these costs will work or whether a RAD or DAP (Daily Accommodation Payment) is better suited for your family, Aged Care Simplified can explain your options in plain language and help you make confident financial decisions.

4. Improved Quality and Oversight

The reforms also strengthen care quality and provider accountability.

• Updated Aged Care Quality Standards will come into force in 2025.

• Providers will face new financial and prudential standards to ensure long-term viability.

• The Aged Care Quality and Safety Commission will gain stronger powers to handle complaints and monitor provider performance.

These measures aim to create greater trust and transparency for residents and their families.

💬 What These Changes Mean for Families

If your loved one is already in residential care before November 2025, their current arrangements will remain unchanged. For those entering after the reforms take effect, it’s important to:

• Understand the new fee structure and contribution caps.

• Review accommodation options and associated costs.

• Ask providers about their compliance with the new standards and resident rights.

Aged Care Simplified can help you navigate each of these steps — from understanding the new fee structure and Centrelink assessments to preparing applications for residential aged care facilities.

How Aged Care Simplified Can Support You

At Aged Care Simplified, we know that aged care decisions are deeply personal — and often emotional. Our role is to make the process clearer and less stressful by offering:

• Step-by-step guidance through the new aged care system.

• Assistance with Centrelink and aged care documentation (including Income and Assets Assessments).

• Independent advice on care options, costs, and rights under the new legislation.

• Compassionate, practical support throughout the transition into residential aged care.

We stay up to date with the latest government changes so you don’t have to. With our help, families can focus on what truly matters — the wellbeing of their loved ones.

Final Thoughts

Australia’s aged care reforms represent a major step toward a fairer, safer, and more transparent system. But with change comes complexity — and that’s why guidance is so important.

Whether you’re planning ahead or preparing for an immediate transition, Aged Care Simplified is here to help you understand your options, meet your obligations, and make informed decisions with confidence.

Get in touch today to learn how we can support your family through the upcoming changes to residential aged care in Australia.