The Federal Government has officially delayed the start of new Residential Aged Care fee reforms from 1 July to 1 November 2025, aligning them with the rollout of the new Aged Care Act and Support at Home program.

What’s changing from 1 November 2025?

Accommodation Payments

• RAD cap increasing from $550,000 to $750,000
• A new 2% retention fee, deducted annually (max. 5 years)
• DAPs to be indexed twice per year with CPI

Ongoing Fees

• Hotelling Contribution – means-tested; up to $4,580 p.a.
• Non-Clinical Care Contribution – also means-tested; up to $36,923 p.a.
• Higher Everyday Living Fee – optional fee for premium services
• A lifetime $130,000 cap on non-clinical care fees (shared with Support at Home)

These fees will replace the current Means-Tested Care Fee and additional/extra service fees for new residents.

Who will be affected?

These new rules apply only to those entering aged care from 1 November 2025. If you are already in residential care before this date, you’ll be covered under the ‘no worse off’ principle –and won’t be forced onto the new fee structure.

For further details, please refer to our Support at Home blog and Aged Care Reforms Overview.

Need help understanding the changes?

Contact Brendan O’Reilly at Peak Advice to explore how these reforms may fit into your retirement strategy.

We can assist you with navigating these options and helping you choose a solution that’s right for you. From understanding funding rules to coordinating care plans and managing Centrelink entitlements, we’re here to help you make confident, well-informed decisions.