Nursing Home Costs in Australia (2026 Guide)
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Moving a loved one into residential aged care is one of the most significant financial decisions an Australian family will face. The costs can seem confusing at first, with multiple fee types and a government assessment process that determines what you actually pay.
This guide breaks down every component of nursing home costs in Australia for 2026. You will find current fee amounts, worked examples for different financial situations, a state-by-state comparison of accommodation costs, and practical tips for reducing what you pay.
Quick estimate: Use our free Aged Care Calculator to get a personalised estimate of residential aged care costs based on your financial situation.
How much does a nursing home cost in 2026?
There is no single price for a nursing home in Australia. Your total cost depends on three factors: your income, your assets, and the specific facility you choose. However, here is what the typical cost range looks like.
| Fee component | Who pays | Typical cost (2026) |
|---|---|---|
| Basic daily fee | Everyone | $61.96/day ($22,615/year) |
| Means-tested care fee | Those above income/asset thresholds | $0 to $33,309/year (capped) |
| Accommodation (RAD or DAP) | Non-supported residents | $300,000 to $800,000+ (RAD) or $40 to $120+/day (DAP) |
| Extra and optional services | Those who choose them | $15 to $60/day |
At a minimum, every nursing home resident pays the basic daily fee of $61.96 per day, which works out to approximately $434 per week or $22,615 per year. This is the floor.
At the upper end, a self-funded retiree in a premium facility could pay $80,000 or more per year when you combine all fees, plus a lump-sum accommodation deposit.
The key point is that the system is means-tested. You will only ever be asked to pay what the government determines you can reasonably afford.
Complete breakdown of nursing home fees
Your nursing home bill is made up of four possible components. Here is exactly what each one involves and how much it costs in 2026.
1. Basic daily fee (everyone pays this)
The basic daily fee is a fixed daily charge that every nursing home resident pays, regardless of income or assets. It is set by the government at 85% of the single basic Age Pension rate.
Current amount (March 2026): $61.96 per day / $434 per week / $22,615 per year
This fee covers your day-to-day living costs in the facility:
- Three meals a day plus snacks
- Laundry and linen services
- Cleaning of your room and common areas
- Heating, cooling, and electricity
- General facility maintenance
The basic daily fee is adjusted twice a year (20 March and 20 September) in line with Age Pension increases. It cannot be reduced or waived, and it is the same amount at every facility.
2. Means-tested care fee (depends on your finances)
The means-tested care fee is an additional contribution toward the cost of your clinical and personal care. Not everyone pays this fee. It only applies if your income and assets exceed certain thresholds set by the government.
Services Australia conducts a formal income and assets assessment to determine whether you pay this fee and how much.
Key thresholds for 2025-26:
| Situation | Income-free threshold | Asset-free threshold |
|---|---|---|
| Single, homeowner | $32,878/year | $197,735.20 |
| Single, non-homeowner | $32,878/year | $322,035.20 |
| Couple, homeowner | $32,878 each/year | $197,735.20 each |
| Couple, non-homeowner | $32,878 each/year | $322,035.20 each |
If your income and assets fall below these thresholds, you pay no means-tested care fee.
Annual and lifetime caps protect you from excessive costs:
| Cap type | Amount (2025-26) |
|---|---|
| Annual cap | $33,309.20 |
| Lifetime cap | $79,942.08 |
Once you reach the annual cap, you stop paying the means-tested care fee for the rest of that 12-month period. Once you reach the lifetime cap, you never pay this fee again.
3. Accommodation costs (RAD, DAP, or combination)
Accommodation costs are the charge for your room, and they are set by each individual facility. Whether you pay accommodation costs, and how you pay them, depends entirely on your means test result.
If you are a “supported resident” (your income and assets are below certain thresholds), the government pays your accommodation costs in full. You pay nothing for your room.
If you are a “non-supported resident” (your income and assets are above the thresholds), you need to pay for your accommodation. You have three options:
| Payment method | How it works | Example |
|---|---|---|
| Refundable Accommodation Deposit (RAD) | Lump sum, fully refunded when you leave | $450,000 paid upfront |
| Daily Accommodation Payment (DAP) | Daily rental-style payment, not refundable | ~$55/day based on $450,000 RAD |
| Combination | Part lump sum, part daily payment | $200,000 RAD + ~$30/day DAP |
The RAD is fully refundable to you or your estate when you leave care, minus any agreed deductions. Think of it as an interest-free loan to the provider.
The DAP is calculated from the RAD amount using the Maximum Permissible Interest Rate (MPIR), which is published quarterly by the government. As of early 2026, the MPIR is approximately 4.46%.
DAP calculation example:
- Room RAD: $450,000
- MPIR: 4.46%
- DAP = $450,000 x 4.46% / 365 = $54.99 per day
The maximum RAD a facility can charge without government approval is currently $758,627. Many facilities charge well above this with approval.
You have 28 days after entering the facility to decide how to pay, and you can change your payment method later with notice.
4. Extra and optional service fees
Some nursing homes offer additional services beyond the standard care for an extra daily fee. These might include:
- Premium meals or menu choices
- A larger or better-appointed room
- Foxtel, internet, or entertainment packages
- Newspapers and magazines
- Hairdressing and beauty services
- Outings and social programs
These fees vary widely between facilities, typically ranging from $15 to $60 per day. They are entirely optional and must be agreed to in writing before you are charged.
Important: Always ask for a complete written list of extra and optional service fees before choosing a facility. Some costs that families assume are included (such as continence aids, physiotherapy top-ups, or transport to medical appointments) may attract additional charges.
Worked examples: what real families pay
These examples show how nursing home costs work for different financial situations. All figures use 2025-26 rates.
Example 1: Full pensioner (Jean, age 83)
Jean’s situation:
- Single, aged 83
- Receives the full Age Pension ($28,514/year)
- Owns her home (value $580,000), but her daughter lives there
- Has $28,000 in savings
- No other income or assets
Means test result:
- Home excluded (daughter is a protected person)
- Income: $28,514 (below $32,878 threshold)
- Assets: $28,000 (below $197,735.20 threshold)
What Jean pays:
| Fee | Daily | Weekly | Annual |
|---|---|---|---|
| Basic daily fee | $61.96 | $434 | $22,615 |
| Means-tested care fee | $0 | $0 | $0 |
| Accommodation | $0 (government-supported) | $0 | $0 |
| Total | $61.96 | $434 | $22,615 |
Jean pays only the basic daily fee. The government covers her care costs and accommodation. Her pension covers most of this fee, and she retains a minimum amount for personal expenses.
Example 2: Part pensioner with spouse at home (George, age 79)
George’s situation:
- Married, aged 79
- Wife Margaret remains in the family home (value $900,000)
- Combined assets: $420,000 (excluding home)
- George’s share of assets: $210,000
- George’s income: $31,000/year (part pension plus small super income)
Means test result:
- Home excluded (Margaret is a protected person)
- Income: $31,000 (below $32,878 threshold)
- Assets: $210,000 (just above the $197,735.20 threshold for homeowners)
What George pays:
| Fee | Daily | Weekly | Annual |
|---|---|---|---|
| Basic daily fee | $61.96 | $434 | $22,615 |
| Means-tested care fee | ~$5.80 | ~$41 | ~$2,117 |
| Accommodation (DAP on $380,000 room) | $46.44 | $325 | $16,951 |
| Total | ~$114.20 | ~$800 | ~$41,683 |
George pays a small means-tested care fee because his assets slightly exceed the threshold. He and Margaret chose the DAP option to avoid tying up their savings in a lump sum.
Example 3: Self-funded retiree (Patricia, age 76)
Patricia’s situation:
- Single, aged 76
- Does not receive the Age Pension
- Owns her home (value $1.4 million), no one living there
- Has $650,000 in superannuation (account-based pension)
- Has $180,000 in shares and savings
- Draws $60,000/year from super
- Choosing a premium facility with a $550,000 RAD
Means test result:
- Home included but capped at $197,735.20
- Total assessable assets: $197,735.20 + $650,000 + $180,000 = $1,027,735.20
- Income above threshold: substantial
What Patricia pays:
| Fee | Daily | Weekly | Annual |
|---|---|---|---|
| Basic daily fee | $61.96 | $434 | $22,615 |
| Means-tested care fee (at annual cap) | $91.26 | $639 | $33,309 |
| Accommodation (full RAD of $550,000) | $0/day (lump sum) | $0 | $0 |
| Extra services | $35.00 | $245 | $12,775 |
| Total (excluding RAD) | ~$188.22 | ~$1,318 | ~$68,699 |
| Plus RAD (refundable) | $550,000 |
Patricia pays the maximum annual means-tested care fee because her assets are well above the thresholds. However, after approximately 2.4 years, she will reach the lifetime cap of $79,942.08 and stop paying the means-tested care fee permanently.
Her RAD of $550,000 is fully refundable when she leaves care.
Comparison summary
| Scenario | Weekly cost | Annual cost | Accommodation |
|---|---|---|---|
| Jean (full pensioner) | $434 | $22,615 | Government pays |
| George (part pensioner, spouse at home) | $800 | $41,683 | DAP $46/day |
| Patricia (self-funded retiree) | $1,318 | $68,699 | RAD $550,000 (refundable) |
Nursing home accommodation costs by state
Accommodation costs vary significantly depending on where the facility is located. Metropolitan areas are generally more expensive than regional areas, and some states have higher average costs than others.
Average RAD by state and territory (2025-26)
| State/Territory | Average RAD (metro) | Average RAD (regional) | Average DAP (metro) |
|---|---|---|---|
| New South Wales | $480,000 - $650,000 | $300,000 - $420,000 | $59 - $80/day |
| Victoria | $450,000 - $600,000 | $280,000 - $400,000 | $55 - $73/day |
| Queensland | $400,000 - $520,000 | $250,000 - $380,000 | $49 - $64/day |
| Western Australia | $380,000 - $500,000 | $250,000 - $370,000 | $46 - $61/day |
| South Australia | $350,000 - $470,000 | $220,000 - $350,000 | $43 - $58/day |
| Tasmania | $300,000 - $420,000 | $200,000 - $320,000 | $37 - $51/day |
| ACT | $450,000 - $580,000 | N/A | $55 - $71/day |
| Northern Territory | $350,000 - $450,000 | $250,000 - $380,000 | $43 - $55/day |
Note: These are approximate ranges based on published room prices on the My Aged Care website. Individual facilities may fall outside these ranges. Premium rooms with extra services can be significantly higher.
What drives the price differences?
Several factors affect accommodation costs by location:
- Property values: Facilities in areas with high real estate costs charge higher RADs to cover the value of the land and buildings
- Demand: Areas with long waiting lists tend to have higher prices
- Facility age and quality: Newer, purpose-built facilities generally charge more than older ones
- Room type: Single rooms with ensuites cost more than shared rooms
- Extra services: Facilities that bundle premium services into the accommodation often have higher RADs
How to compare costs in your area
You can compare room prices for any facility in Australia on the My Aged Care website. Every provider must publish their room prices, including the RAD and equivalent DAP, for each room type they offer.
When comparing, look at the total cost package, not just the RAD. A facility with a lower RAD but higher extra service fees may end up costing more overall.
The financial assessment process step by step
Before you commit to any nursing home, you need to go through the government’s assessment process. This determines what fees you are required to pay and whether the government subsidises your accommodation.
Step 1: Get assessed by an ACAT
An Aged Care Assessment Team (ACAT, or ACAS in Victoria) conducts a free assessment to determine whether you are eligible for residential aged care. Contact My Aged Care on 1800 200 422 to arrange an assessment.
The ACAT assessment considers your care needs, not your finances. It determines the level of care you require, not what you will pay.
Step 2: Complete the income and assets assessment
This is the critical step for determining your costs. Services Australia (or the Department of Veterans’ Affairs for eligible veterans) conducts a detailed assessment of your income and assets.
What you need to provide:
- Details of all bank accounts, savings, and term deposits
- Superannuation balances and income streams
- Share portfolios and managed fund statements
- Investment property details
- Motor vehicles, boats, and other assets
- Income from all sources (pension, employment, investments, rental)
- Details of any gifts made in the last five years
What counts as an asset:
| Included | Excluded |
|---|---|
| Bank accounts and savings | Your home (if a protected person lives there) |
| Shares, managed funds, bonds | Funeral bonds (up to $15,000) |
| Superannuation (pension phase) | Prepaid funeral expenses |
| Investment properties | RAD once paid to a facility |
| Vehicles, boats, caravans | Accommodation bond (pre-2014 entry) |
| Personal effects above threshold | Special disability trusts (some) |
Step 3: Receive your fee letter
After the assessment, Services Australia sends you a letter detailing the maximum fees you can be charged. This letter tells you:
- Whether you are a supported or non-supported resident
- Your maximum means-tested care fee (if applicable)
- Whether the government will contribute to your accommodation costs
Provide a copy of this letter to your chosen facility. They will use it to calculate your exact fees and prepare a resident agreement.
Step 4: Review the resident agreement
Before entering the facility, you will receive a resident agreement that sets out:
- All the fees you will pay and how they are calculated
- The services included in the standard care
- Any extra or optional services and their costs
- Your rights and the facility’s obligations
- The refund process for any RAD payments
You have the right to seek independent advice before signing. Take the time to review this carefully.
How the family home is treated in the means test
The treatment of the family home is one of the most common concerns for families. Here is how it works.
When the home is excluded
Your home is completely excluded from the means test if a “protected person” continues to live there. A protected person includes:
- Your spouse or partner
- A dependent child
- A close relative who has lived with you for at least five years and receives an income support payment
- A carer who has lived with you for at least two years and receives an income support payment
If any of these people live in your home, its value does not count in your assessment at all, regardless of what the home is worth.
When the home is included (but capped)
If no protected person lives in your home, the home is included in the assets test but capped at $197,735.20 (2025-26 rate). Even if your home is worth $2 million, only $197,735.20 is counted.
Should you sell the family home?
This is one of the biggest financial decisions in aged care, and the answer depends on your individual circumstances.
Reasons to keep the home:
- If a protected person lives there, it is excluded entirely
- Even if included, the capped value ($197,735.20) is often less than the cash you would hold from selling
- Selling converts a capped asset into uncapped financial assets, which could increase your means-tested care fee
- The home may appreciate in value for your estate
Reasons to sell:
- You need the funds to pay a RAD (though you could use a DAP instead)
- Maintaining an empty property has ongoing costs
- The home no longer serves a purpose for the family
Important: If you gift your home or transfer it to family members within five years of entering care, Services Australia may still count its value under deprivation rules. Always get financial advice before making this decision.
Financial hardship provisions
The Australian aged care system includes protections for people who cannot afford their assessed fees.
Government safety net
If your means test shows you cannot afford to contribute, the government pays your costs. You will never be turned away from care because you cannot pay. The system guarantees that:
- You will always retain a minimum daily amount for personal expenses
- Your fees cannot exceed what the assessment determines you can afford
- Annual and lifetime caps limit your total means-tested care fee payments
- You cannot be discharged from a facility for inability to pay
Applying for financial hardship
If your financial circumstances change after entering care, or if paying your assessed fees causes genuine hardship, you can apply for a financial hardship supplement.
When to apply:
- Your assessed fees leave you unable to meet basic living expenses
- Your assets are tied up in property you cannot easily sell
- You have experienced unexpected financial setbacks (investment losses, partner illness)
- Your income has dropped since your last assessment
How to apply:
- Contact Services Australia on 1800 227 475
- Complete the financial hardship application form
- Provide supporting documentation of your financial situation
- Services Australia reviews your case and may reduce or waive certain fees
- The hardship supplement is reviewed periodically (usually every 12 months)
Other sources of help
- Financial Information Service (FIS): Free financial guidance from Services Australia. Call 132 300.
- National Debt Helpline: Free financial counselling. Call 1800 007 007.
- Older Persons Advocacy Network (OPAN): Free advocacy support. Call 1800 700 600.
RAD vs DAP: which should you choose?
If you are assessed as a non-supported resident, choosing between a RAD and a DAP is a major financial decision. Here is how they compare.
| Factor | RAD (lump sum) | DAP (daily payment) |
|---|---|---|
| Refundable? | Yes, fully refunded when you leave | No, payments are not returned |
| Impact on Age Pension | May reduce pension (asset is converted to deposit) | No impact on assets test |
| Opportunity cost | Lose investment returns on the lump sum | Keep your money invested |
| Cash flow | No ongoing accommodation payments | Ongoing daily cost |
| Risk | Provider must refund (government-guaranteed) | No risk, but money is spent |
| Best for | Those with substantial liquid assets who want to protect capital | Those who want to preserve investments or lack a lump sum |
The combination option
Many families choose a combination: pay a partial RAD to reduce the daily DAP. For example:
- Room RAD: $450,000
- You pay $200,000 as a partial RAD
- Remaining $250,000 is converted to DAP: $250,000 x 4.46% / 365 = $30.55/day
This approach balances capital preservation with manageable daily costs.
10 tips to reduce your nursing home costs
-
Get the means test done early. Do not delay the income and assets assessment. Knowing your exact fee obligations helps you plan and avoids surprises.
-
Keep a protected person in the home. If your spouse or qualifying family member can stay in the home, it is excluded entirely from the means test, potentially saving tens of thousands in fees.
-
Compare facilities on total cost, not just RAD. A lower RAD with high extra service fees can cost more than a higher RAD at a facility with fewer add-ons.
-
Consider the DAP or a combination payment. Paying a full RAD ties up capital. A DAP or partial RAD keeps money available for investment or emergencies.
-
Do not rush to sell the family home. Selling converts a capped asset ($197,735.20) into uncapped financial assets, which could increase your means-tested care fee.
-
Check your means test is accurate. Ensure Services Australia has the correct, current information. An outdated assessment could mean you are overpaying.
-
Understand the lifetime cap. If your means-tested care fee is high, you will reach the lifetime cap of $79,942.08 faster, after which you stop paying this fee permanently.
-
Ask about all fees before choosing a facility. Request a complete written schedule of extra and optional service fees. Hidden charges can add significantly to your costs.
-
Get specialist financial advice. An accredited aged care financial adviser can model different scenarios and help you structure your finances to minimise total fees while protecting your pension entitlements.
-
Apply for hardship if needed. If your circumstances change, do not wait. Contact Services Australia immediately to request a reassessment or hardship supplement.
DIY cost calculator: estimate your fees step-by-step
Use this structured guide to estimate your nursing home costs before your official Services Australia assessment.
Step 1: Basic daily fee (everyone pays)
Amount: $61.96/day = $1,859/month = $22,615/year
No calculation needed. This is fixed for everyone.
Step 2: Means-tested care fee calculation
2a. Calculate assessable income
List all income sources:
- Age Pension (full or part): $______
- Super pension or annuity: $______
- Deemed income on savings (calculate below): $______
- Rental income: $______
- Total income: $______
Deemed income on financial assets:
- First $60,400 (singles): deemed at 0.25%
- Above $60,400: deemed at 2.25%
Example: $200,000 in savings:
- $60,400 x 0.25% = $151
- $139,600 x 2.25% = $3,141
- Total deemed: $3,292/year
2b. Income test formula
Income-free threshold: $32,878/year
If income > $32,878:
- 50% of income between $32,878 and $82,055
- Plus 25% of income above $82,055
2c. Calculate assessable assets
List all assets (excluding exempt items):
- Home value: $______ (or $0 if spouse lives there)
- Investment property: $______
- Savings and term deposits: $______
- Shares and managed funds: $______
- Superannuation (if over Age Pension age): $______
- Total assets: $______
Asset-free threshold: $197,735 (homeowner) or $322,035 (non-homeowner)
2d. Asset test formula
If assets > threshold:
- 17.5% of assets between $197,735 and $398,814
- Plus 1% of assets between $398,814 and $758,627
- Plus 2% of assets above $758,627
Example: $450,000 assessable assets:
- $201,079 x 17.5% = $35,189
- $51,186 x 1% = $512
- Total: $35,701/year
2e. Final means-tested care fee
Take the higher of your income test or asset test result.
Annual cap: $33,309 (if calculated fee exceeds this, you only pay the cap)
Step 3: Accommodation payment (if non-supported)
Supported resident test:
- Assets < $59,162 (after exemptions), OR
- Assets < $197,735 AND income < $32,878
If supported: Government pays accommodation (you pay $0)
If non-supported: Negotiate RAD/DAP with facility
RAD to DAP conversion: DAP = (RAD x MPIR) / 365
Current MPIR (March 2026): 4.46%
Example: $500,000 RAD:
- DAP = $500,000 x 4.46% / 365 = $61.10/day
Step 4: Total monthly cost estimate
| Fee component | Your amount |
|---|---|
| Basic daily fee | $1,859 |
| Means-tested care fee (if applicable) | $______ |
| DAP (if applicable) | $______ |
| Extra services (optional) | $______ |
| Total estimated monthly cost | $______ |
Important: This is an estimate only. Your official assessment may differ due to complex valuation rules, gifting provisions, or special circumstances. Always get professional aged care financial advice before making major decisions.
2026 fee updates and changes
March 2026 basic daily fee increase
The basic daily fee increased from $60.22 to $61.96 per day on March 20, 2026, following Age Pension indexation.
Impact: All residents pay an additional $52/month ($635/year).
MPIR rate decrease (January 2026)
The Maximum Permissible Interest Rate decreased from 4.61% to 4.46% on January 1, 2026.
Impact on DAP costs:
| RAD amount | Old DAP (4.61%) | New DAP (4.46%) | Monthly savings |
|---|---|---|---|
| $300,000 | $37.89/day | $36.66/day | $37 |
| $500,000 | $63.15/day | $61.10/day | $62 |
| $700,000 | $88.41/day | $85.54/day | $86 |
If you are paying DAP, your daily cost decreased slightly in January 2026.
Accommodation price trends by state (2026)
Average RAD prices by state continue to rise:
| State | 2025 average | 2026 average | Change |
|---|---|---|---|
| NSW | $535,000 | $560,000 | +4.7% |
| VIC | $460,000 | $485,000 | +5.4% |
| QLD | $400,000 | $425,000 | +6.3% |
| WA | $385,000 | $405,000 | +5.2% |
| SA | $365,000 | $380,000 | +4.1% |
| TAS | $320,000 | $335,000 | +4.7% |
Premium facilities in Sydney and Melbourne now regularly exceed $1 million RAD for larger or luxury rooms.
Support at Home impact on residential care demand
The Support at Home Program (launched November 2025) has increased home care capacity, allowing more people to stay at home longer with higher-level support.
Consequence: Some facilities report increased vacancy rates for low-care beds, while high-care beds remain in demand. This may create negotiating leverage for RAD discounts in some areas.
For details on Support at Home, see our Support at Home program guide.
Financial hardship streamlined
Services Australia now processes financial hardship applications within 14 days (previously 28 days), providing faster relief for families facing sudden financial crises.
March 2026: Ministerial Investigation Into Premium Service Fees
On 16 March 2026, the Aged Care Minister announced an investigation into claims that some aged care providers are charging premium fees for basic services that should be covered under standard care arrangements. The Minister specifically named Opal Healthcare as one provider under scrutiny, calling the practice “disgusting sidestepping” of aged care regulations.
This investigation is critical for families navigating nursing home costs. When comparing facilities and reviewing fee schedules, carefully examine which services are included in the basic daily fee and which are genuinely optional extras. Some providers may be inappropriately categorizing basic care activities as premium services to justify additional charges beyond the standard fees outlined in this guide.
If you believe you are being charged for services that should be included in standard care, lodge a complaint with the Aged Care Quality and Safety Commission on 1800 951 822. The Minister emphasized that while regulations provide absolute minimum standards, Australians expect and deserve dignity in aged care, not exploitative pricing practices.
Source: ABC News, 16 March 2026
Frequently asked questions
How much does a nursing home cost per week in Australia?
A nursing home costs at least $434 per week for the basic daily fee alone (2026 rates). Total weekly costs range from $434 for full pensioners with government-supported accommodation to $1,500 or more for self-funded retirees who pay means-tested care fees and accommodation costs. The exact amount depends on your income, assets, and the facility you choose.
Do you have to sell your house to pay for a nursing home?
No. You are never forced to sell your home to pay for aged care. If a protected person (your spouse, dependent child, or qualifying carer) still lives there, the home is completely excluded from the means test. If no one lives there, the home value is capped at $197,735.20 in the assessment. Many families keep the home and use other options like the DAP for accommodation payments.
What is the difference between RAD and DAP?
A RAD (Refundable Accommodation Deposit) is a lump sum paid upfront that is fully refunded when you leave care. A DAP (Daily Accommodation Payment) is an ongoing daily fee calculated from the RAD amount using the government’s interest rate. You can also pay a combination of both. The choice depends on your financial situation and whether you want to preserve capital or avoid daily payments.
Can I get a pension while living in a nursing home?
Yes. You can continue to receive the Age Pension while living in a nursing home. However, if you pay a RAD, the lump sum amount is exempt from the pension assets test, which could actually increase your pension entitlement. Your pension income is factored into the means-tested care fee calculation.
What happens to a couple when one partner goes into a nursing home?
When one partner enters residential care, the couple’s assets are typically divided equally for assessment purposes. The home is excluded from the means test if the other partner continues to live there. The partner at home retains their own pension and income. Services Australia assesses each person’s share of assets separately for the means-tested care fee.
Are nursing home costs tax-deductible?
No. Nursing home fees, including the basic daily fee, means-tested care fee, and accommodation payments, are not tax-deductible for individual taxpayers. They are considered personal living expenses. However, if you are paying for a family member’s care, you should check with a tax adviser whether any offsets apply to your specific situation.
What happens if a nursing home resident runs out of money?
If your financial situation changes and you can no longer afford your assessed fees, you will not be asked to leave. The government steps in through the financial hardship provisions. Contact Services Australia to request a reassessment. Your fees will be adjusted to reflect your current circumstances, and the government increases its contribution to the provider.
How long is the average stay in a nursing home?
The average stay in residential aged care in Australia is approximately 2.5 to 3 years. However, this varies widely. Some residents stay for a few months, while others stay for five years or more. This is important for financial planning, as a longer stay means higher cumulative costs but also means you are more likely to reach the lifetime cap on means-tested care fees.
Getting help with nursing home costs
Understanding nursing home costs can feel overwhelming, but you do not have to navigate the system alone. MD Home Care is a connection platform that helps Australian families find the right aged care providers and understand their options.
Call 1800 953 253 to find aged care providers through MD Home Care, or explore our aged care directory to browse providers across Australia.
Related guides
Build a complete understanding of aged care costs with these resources:
- Basic daily fee explained — what everyone pays and how it is calculated
- Means-tested care fee complete guide — how income and assets affect your fees
- Refundable Accommodation Deposit (RAD) guide — everything about lump sum accommodation payments
- Browse aged care providers by region — find and compare providers near you
MD Home Care connects families with aged care providers across Australia. Whether you need help understanding fees, comparing facilities, or navigating the assessment process, our platform is here to connect you with the right provider.
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