Home Care Package Level 2: Funding & Services 2026
Camila
Healthcare Expert
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Key Points:
- Home Care Package Level 2 provides $18,866 per year (2025-26 rate) for low-level care needs such as light domestic help, personal care assistance, and social support
- As of July 1, 2025, new applicants enter the Support at Home program rather than traditional Home Care Packages, though existing Level 2 recipients can remain on their current package during transition
- Level 2 typically suits people who need help 2-4 times per week with tasks they can no longer manage independently due to age or frailty
- Services include personal care, domestic assistance, transport, meal preparation, allied health, social support, and basic nursing care
- Provider management fees range from 15% to 40% of your package, directly impacting how many care hours you receive (expect 4-8 hours per week depending on fees)
- The new Support at Home system replaces the four HCP levels with a flexible funding model based on individual assessment
- Average wait time for Level 2 approval was 3-4 months before Support at Home, now assessments aim to be faster with streamlined processes
- You can change providers at any time without penalty if you are unhappy with services or fees
- Level 2 funding cannot be used for permanent accommodation, everyday living costs (groceries, utilities), or medical treatment covered by Medicare
- Income-tested contributions may apply: if your annual income exceeds $32,279 (single) or $51,338 (couple), you contribute 50c per dollar over the threshold, capped at $11,801 annually
What Is a Level 2 Home Care Package?
A Level 2 Home Care Package is government-funded support for older Australians with low-level care needs who want to remain living at home. It provides an annual budget of $18,866 (2025-26 rate) to purchase services that help with everyday activities affected by aging, frailty, or disability.
Level 2 sits between Level 1 (basic support) and Level 3 (intermediate care) in the old four-tier Home Care Package system. It is designed for people who need regular help but do not yet require the intensive daily support provided at higher levels.
How Level 2 Fits Into the Four HCP Levels
| Package Level | Annual Funding (2025-26) | Typical Care Needs |
|---|---|---|
| Level 1 | $10,353 | Entry-level support, 1-2 visits per week |
| Level 2 | $18,866 | Low-level care, 2-4 visits per week |
| Level 3 | $36,451 | Intermediate care, daily or near-daily support |
| Level 4 | $62,835 | High-level care, multiple daily visits |
Level 2 is the most commonly allocated package level, accounting for approximately 35-40% of all Home Care Packages.
Support at Home: The Transition from Levels
As of July 1, 2025, the Australian Government introduced the Support at Home program, gradually replacing the Home Care Package system.
What this means for you:
-
If you already have a Level 2 package: You keep it during the transition period. Your provider will contact you about moving to Support at Home when your transition date arrives. No action is required immediately.
-
If you are applying for aged care support now: You enter the Support at Home program, not the old HCP system. Your funding is determined by individual assessment rather than being assigned to one of four levels.
-
Support at Home equivalent to Level 2: Under the new system, you would likely be assessed as needing ongoing services - classification 2 or 3, with similar annual funding to the old Level 2.
This guide covers both the existing Level 2 packages (for current recipients) and what the equivalent looks like under Support at Home (for new entrants).
For complete information about the new Support at Home program, see our Support at Home guide.
Who Qualifies for Level 2 Home Care?
To receive a Level 2 Home Care Package, you must meet all of the following criteria:
Age requirement:
- Be 65 years or older, or
- Be 50 years or older if you are Aboriginal or Torres Strait Islander
Residency:
- Be an Australian citizen or permanent resident
- Be living in Australia at the time of application
Care needs assessment:
- Have been assessed by an Aged Care Assessment Team (ACAT) or Aged Care Assessment Service (ACAS) as needing Level 2 support
- Demonstrate that you can no longer manage certain everyday tasks independently due to age, frailty, or disability
Choose to remain at home:
- Prefer to receive care and support at home rather than entering residential aged care
What Care Needs Does Level 2 Address?
Level 2 is designed for people who:
- Need help with some but not all daily activities
- Can still manage personal care tasks independently but require assistance with domestic duties, or vice versa
- Experience increasing difficulty with tasks like shopping, cleaning, meal preparation, or transport
- Benefit from social support to reduce isolation
- Require some support to manage medications or attend health appointments
- May need allied health services such as podiatry or physiotherapy
Common situations leading to Level 2 approval:
- Declining mobility making household cleaning, shopping, and garden maintenance difficult
- Recovery from surgery or illness where temporary increased support is needed
- Early-stage dementia requiring prompting and supervision for daily routines
- Chronic health conditions (arthritis, diabetes, heart disease) limiting physical capacity
- Social isolation and need for regular social engagement and transport to community activities
- Falls risk requiring home modifications and mobility aids
What If My Needs Change?
If your care needs increase beyond what Level 2 provides, you can request reassessment for an upgrade to Level 3 or Level 4. Contact My Aged Care on 1800 200 422 or speak to your current provider about requesting a reassessment.
How Much Funding Do You Get?
Annual Budget
The Level 2 Home Care Package provides $18,866 per year (2025-26 financial year).
This funding is paid by the government directly to your chosen aged care provider. The provider deducts their management fees and pays for approved services on your behalf.
Daily equivalent: $18,866 divided by 365 days = approximately $51.69 per day
Monthly equivalent: $18,866 divided by 12 months = approximately $1,572 per month
How Much Goes to Actual Care?
Not all of your $18,866 is spent on direct care. Providers deduct administration and care management fees, reducing the amount available for support workers and services.
Typical fee breakdown:
| Provider Type | Management Fees | Care Funding Available | Care Hours (Approx)* |
|---|---|---|---|
| Low-fee provider | 15-20% | $15,095-$16,036 | 7-8 hours/week |
| Mid-range provider | 25-30% | $13,206-$14,150 | 6-7 hours/week |
| High-fee provider | 35-40% | $11,320-$12,263 | 4-5 hours/week |
*Assuming average hourly rate of $45-$50 per hour for support worker time.
Example calculation:
Provider charging 30% in fees:
- Total package: $18,866
- Provider fees (30%): $5,660
- Care funding available: $13,206
- At $48/hour: approximately 275 hours per year (5.3 hours per week)
Choosing a low-fee provider can give you 2-3 additional hours of support per week, which adds up to 100-150 extra hours annually.
What Fees Do Providers Charge?
Providers can charge for:
1. Package management fee Covers the cost of administering your package, government reporting, financial statements, and compliance. Typically 10-25% of your package.
2. Care management fee Covers the cost of your care manager or case manager who coordinates your services, conducts reviews, and updates your care plan. Typically 5-15% of your package.
3. Service delivery fees The hourly rate charged for support workers, allied health professionals, and other services. This varies by provider and service type.
4. Exit fee (some providers only) A once-off fee charged when you leave a provider, typically $200-$300. Not all providers charge exit fees.
Providers must clearly disclose all fees in writing before you sign your service agreement. Compare fees from multiple providers before making a decision. For detailed fee comparisons, use our Home Care Package Calculator.
Income-Tested Care Fee
Depending on your income, you may be required to contribute an additional amount toward the cost of your care.
How it works:
If your annual income exceeds the threshold ($32,279 for singles, $51,338 for couples in 2025-26), you contribute 50 cents for every dollar over the threshold.
Income-tested care fee is capped at $11,801 per year.
Example:
Single person with annual income of $45,000:
- Income over threshold: $45,000 - $32,279 = $12,721
- Income-tested fee: $12,721 x 0.50 = $6,361 per year ($530/month)
This fee is in addition to the basic daily fee (see below).
Basic Daily Fee
All Home Care Package recipients pay a basic daily fee, currently $12.81 per day (2025-26 rate), or approximately $385 per month.
This fee goes back into the aged care system and is separate from your package funding. It is non-negotiable and the same across all providers.
What Services Can Level 2 Funding Pay For?
Level 2 funding is flexible. You can purchase any service that is reasonable, necessary, and related to your care needs.
Common Level 2 Services
Personal care:
- Assistance with showering, dressing, grooming
- Continence management
- Mobility assistance
Domestic assistance:
- Light housework (vacuuming, dusting, mopping)
- Laundry and ironing
- Changing bed linen
- Washing dishes
Meal preparation:
- Planning and cooking meals
- Shopping for groceries
- Meal delivery services
Transport:
- Accompanied transport to medical appointments
- Shopping trips
- Social outings
Social support:
- Accompanied outings to community activities, cafes, or parks
- Support to maintain friendships and social connections
- Assistance attending religious or cultural activities
Allied health:
- Podiatry
- Physiotherapy
- Dietetics
- Occupational therapy assessment and equipment prescription
- Speech therapy (if needed for swallowing or communication support)
Nursing:
- Basic wound care
- Medication management and administration
- Monitoring chronic health conditions
Home modifications and equipment:
- Grab rails and handrails
- Ramps
- Shower chairs and raised toilet seats
- Walking frames and other mobility aids
Respite care:
- In-home respite (replacement carer while family carer takes a break)
- Centre-based respite (day programs)
- Residential respite (short stays of a few days to a week)
Gardening and home maintenance:
- Lawn mowing
- Garden maintenance
- Gutter cleaning
- Minor home repairs
What Is NOT Covered?
Level 2 funding cannot be used for:
| Not Covered | Why |
|---|---|
| Groceries, utilities, rent, mortgage | Everyday living costs |
| Medical treatment and GP consultations | Covered by Medicare |
| Permanent accommodation or residential aged care fees | Different funding source |
| Services that are not related to your care needs | Not reasonable and necessary |
| Luxury or entertainment items | Not essential care |
| Gambling or alcohol | Not reasonable |
How to Get a Level 2 Home Care Package
Step 1: Contact My Aged Care
Call 1800 200 422 to register and start the assessment process. You can also register online at myagedcare.gov.au.
You will need to answer questions about:
- Your age and living situation
- Your current health and care needs
- What tasks you need help with
- Whether you have informal support (family or friends helping you)
Step 2: Complete the Initial Assessment
A My Aged Care assessor (often a Registered Nurse) will contact you to conduct a phone or in-person assessment. This initial screening determines if you are likely to need aged care services and what level of assessment is appropriate.
If the assessor believes you may need a Home Care Package, they will refer you for a comprehensive face-to-face assessment.
Step 3: Comprehensive Assessment (ACAT/ACAS)
An Aged Care Assessment Team (ACAT) or Aged Care Assessment Service (ACAS) will visit you at home (or in hospital if you are currently admitted) to conduct a detailed assessment.
The assessor will ask about:
- Your physical health and mobility
- Your ability to manage daily tasks
- Your cognitive function and memory
- Your social connections and community engagement
- Your home environment and safety
- Your carer’s situation (if you have a family carer)
The assessor will also speak to family members or carers if you agree.
Assessment outcome:
If approved for Level 2, you will receive a letter confirming your approval and advising you to choose a provider. You will be placed on the national priority queue.
Step 4: Wait for Package Assignment
Once approved, you join the queue for package allocation. Wait times vary depending on demand in your area and your priority status.
Typical wait times (before Support at Home):
- High priority (immediate need): 1-6 weeks
- Medium priority: 2-4 months
- Low priority: 4-6+ months
Priority is based on factors such as:
- Your care needs and risk if support is delayed
- Whether you are leaving hospital and need support to return home safely
- Whether your carer is experiencing significant stress or health issues
Support at Home changes: The new Support at Home system aims to eliminate wait times by providing interim support while you wait for full ongoing services. If you are assessed as needing Level 2-equivalent support, you may receive some services immediately rather than waiting months.
Step 5: Choose a Provider
When your package is allocated, you will receive a letter advising you to choose an approved provider. You can search for providers at myagedcare.gov.au/find-a-provider or call 1800 200 422 for assistance.
Choosing a provider:
Compare providers based on:
- Management and care management fees (aim for under 20% combined)
- Reputation and reviews
- Services offered
- Geographic coverage
- Whether they support self-management or consumer-directed care
Contact multiple providers, request quotes, and ask to see sample service agreements before deciding. There is no obligation to choose the first provider you contact.
Once you choose a provider, they will contact you to arrange your initial care planning meeting.
Step 6: Develop Your Care Plan
Your provider will assign a care manager (also called case manager or care coordinator) who will visit you to create your personalised care plan.
Your care plan will document:
- Your goals and priorities
- What services you need and how often
- Your preferred times for support
- Any specific preferences or requirements (for example, gender of support worker, cultural needs, language)
Your care plan should be reviewed every 6-12 months, or sooner if your needs change.
Making the Most of Your Level 2 Package
Choose a Low-Fee Provider
Provider fees directly impact how much care you receive. A provider charging 20% in fees gives you significantly more support hours than a provider charging 40%.
Comparison:
| Provider Fee | Annual Care Budget | Hours at $48/hr | Weekly Hours |
|---|---|---|---|
| 15% | $16,036 | 334 | 6.4 |
| 20% | $15,093 | 315 | 6.1 |
| 30% | $13,206 | 275 | 5.3 |
| 40% | $11,320 | 236 | 4.5 |
Over one year, choosing a 20% provider instead of a 40% provider gives you an extra 79 hours of care (approximately 1.5 hours per week).
Prioritise Your Highest Needs
Level 2 funding is limited. Focus your budget on the tasks that matter most to your independence, safety, and wellbeing.
Budget allocation strategies:
Option 1: Focus on personal care and safety
- 70% personal care (showering, dressing, medication management)
- 20% domestic assistance (cleaning, laundry)
- 10% allied health and equipment
Option 2: Focus on maintaining independence at home
- 50% domestic assistance and home maintenance
- 30% social support and transport
- 20% personal care and allied health
Option 3: Balanced approach
- 40% personal care
- 30% domestic assistance
- 20% social support and transport
- 10% respite for family carer
Work with your care manager to allocate your budget based on your priorities.
Use Allied Health to Prevent Decline
Regular physiotherapy, podiatry, and occupational therapy can help you maintain strength, mobility, and independence, potentially delaying the need for a higher-level package.
Even allocating 10-15% of your budget to preventive allied health can make a significant difference over time.
Plan for Respite
If you have a family carer, regular respite is essential to prevent carer burnout. Set aside part of your budget for respite services, even if it is just a few hours per week or a day program once a fortnight.
Monitor Your Budget and Spending
Your provider must give you a monthly statement showing:
- Your package balance
- Services delivered and costs
- Fees charged
- Unspent funds
Review these statements carefully. If your spending is higher or lower than expected, discuss adjustments with your care manager.
Save Unspent Funds for Larger Purchases
If your monthly spending is less than your package allocation, unspent funds accumulate in your account. You can use these funds for:
- Expensive one-off equipment purchases (mobility scooter, recliner chair, bathroom modifications)
- Respite care (short residential stay while your carer takes a holiday)
- Increased services during periods of higher need (recovery from surgery or illness)
Do not let providers pressure you to “use it or lose it.” Your unspent funds belong to you and remain available as long as you hold a Home Care Package.
Changing Providers
You can change providers at any time if you are unhappy with the service, fees, or quality of care.
Reasons people change providers:
- High fees reducing available care hours
- Poor communication or unresponsive care managers
- Support workers frequently late, unreliable, or unsuitable
- Difficulty accessing desired services
- Lack of cultural or language compatibility
- Provider refuses to support self-management or consumer direction
How to change providers:
- Choose your new provider and sign a service agreement with them
- Your new provider will manage the transition, including transferring your unspent funds
- Give your current provider written notice (usually 14 days)
- Your new provider takes over service delivery once the transfer is complete
Important:
- You do not need permission from your current provider to change
- Your current provider cannot refuse your transfer request
- Unspent funds transfer with you (minus any exit fees)
- Some providers charge an exit fee (typically $200-$300), so check your service agreement
If you experience difficulty changing providers, contact My Aged Care on 1800 200 422 for assistance.
Transitioning from Level 2 to Level 3 or 4
If your care needs increase, you can request reassessment for a higher-level package.
When to request an upgrade:
- You now need daily support instead of 2-4 times per week
- Personal care needs have increased significantly
- You require more complex nursing or allied health support
- Your current package funding runs out each month before all needs are met
- Your carer is experiencing significant stress and cannot continue without more respite
How to request reassessment:
- Contact My Aged Care on 1800 200 422 and request reassessment for a higher-level package
- An ACAT/ACAS assessor will visit you to reassess your care needs
- If approved, you will be placed on the queue for the higher level
- Your Level 2 package continues until the higher level is allocated
Wait times for upgrades:
Upgrades from Level 2 to Level 3 or 4 are generally processed faster than initial package allocations, especially if your assessor identifies urgent needs.
Support at Home: What to Expect from 2026
For people currently on Level 2 packages, the transition to Support at Home will occur gradually over the coming years. Here is what you need to know:
Key Differences Between HCP Level 2 and Support at Home
| Feature | HCP Level 2 | Support at Home (Equivalent) |
|---|---|---|
| Funding model | Fixed $18,866 annual amount | Flexible funding based on assessed needs |
| Assessment | One-time ACAT assessment | Ongoing reassessment as needs change |
| Fee caps | Voluntary guidelines | Government-mandated fee caps |
| Unspent funds | Retained by consumer | Retained by consumer |
| Wait times | 3-6 months on average | Aims for immediate interim support |
You Do Not Need to Do Anything Immediately
If you currently have a Level 2 package, continue using it as normal. Your provider will contact you when it is time to transition to the new system.
Your Funding Will Not Decrease
The government has committed that your funding will not decrease when you transition from Level 2 to Support at Home. If your assessed needs under the new system align with the old Level 2, you will receive equivalent funding.
You Can Still Change Providers
The transition to Support at Home does not affect your ability to change providers. If you are unhappy with your current provider, you can change before, during, or after the transition.
Frequently Asked Questions
Can I choose my own support worker?
Yes. Many providers support consumer-directed care, allowing you to choose your own support workers. Discuss this with providers before signing a service agreement. Self-management typically results in lower fees and more control.
What if I run out of funding before the end of the year?
If your package funding is exhausted, services will stop unless you pay out-of-pocket. Contact your care manager immediately if you are concerned about running out of funds. You may be able to request reassessment for a higher-level package if your needs have increased.
Can I use my package to pay family members to care for me?
Generally no, unless exceptional circumstances apply and the family member is employed through an approved provider. NDIS funding cannot usually pay for care provided by family members who live with you. Check with your provider for specific rules.
How long does Level 2 approval last?
Your approval does not expire, but your care needs will be reassessed periodically (usually every 12-24 months or sooner if your needs change). If your needs decrease, your package level may be reduced. If your needs increase, you can request an upgrade.
Can I have both a Home Care Package and Commonwealth Home Support Programme (CHSP)?
No. You can only receive funding from one program at a time. If you currently receive CHSP services and are approved for a Home Care Package, your CHSP services will stop when your package begins.
What happens to my unspent funds if I pass away or enter residential care?
Any unspent funds in your package account are returned to the government. They cannot be inherited by your family or estate.
Can I take my package with me if I move to another city?
Yes. Your Home Care Package is portable across Australia. Notify your provider if you are moving, and they will arrange services in your new location or help you transfer to a provider in that area.
Do I have to accept the package level I’m offered?
You can decline a package allocation if you believe it is insufficient for your needs. However, declining a package may result in a longer wait if you reapply. Speak to your assessor about requesting a higher level if you believe your needs were underestimated.
Can I use my package for one-off expenses like a stairlift or bathroom modification?
Yes, but only if the equipment is reasonable, necessary, and directly related to your care needs. Major home modifications may require quotes and approval from your provider before purchase. Some expensive items may be better funded through other programs such as the Medical Aids Subsidy Scheme (in some states).
What if I disagree with my ACAT assessment outcome?
You have the right to request a review if you believe your assessment was incorrect. Contact My Aged Care on 1800 200 422 to request a reassessment or lodge a formal complaint.
Can I use my package funding for holidays or entertainment?
No. Funding must be used for reasonable and necessary care and support. You cannot use package funding for holidays, entertainment, gambling, or other non-care expenses.
How do I know if my provider is charging fair fees?
Compare fees from multiple providers before signing. Aim for combined package management and care management fees under 20%. Request quotes in writing and ask for a breakdown of all fees.
Key Resources
My Aged Care: https://www.myagedcare.gov.au Call 1800 200 422 (8am-8pm Monday to Friday, 10am-2pm Saturday)
Find a Provider: https://www.myagedcare.gov.au/find-a-provider
Home Care Package Calculator: Calculate your available care hours
Aged Care Quality and Safety Commission: https://www.agedcarequality.gov.au Call 1800 951 822 (complaints and quality concerns)
National Seniors Australia: https://nationalseniors.com.au Information and advocacy for older Australians
COTA Australia (Council on the Ageing): https://www.cota.org.au Peak body for older Australians, policy and advocacy
Dementia Australia: https://www.dementia.org.au Call 1800 100 500 (support and information for people living with dementia)
How MD Home Care Can Help
MD Home Care connects Home Care Package recipients across Melbourne with trusted providers who take a low-fee, consumer-directed approach, putting your funding toward actual care hours rather than administrative overhead.
Through MD Home Care, you can find providers for:
- Personal care and assistance with daily living
- Domestic support and home maintenance
- Allied health coordination (physio, OT, podiatry)
- Social support and community access
- Respite care for family carers
- Meal preparation and nutrition support
Contact MD Home Care to find the right provider for your Level 2 Home Care Package.
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