Most older Australians want to stay at home rather than move into an aged care home, but government funding often falls short of covering all their needs. Many families find they must top up their Support at Home packages with private funds to safely remain independent. With wait times for home care averaging a year, ageing at home has become a co-contribution model that relies heavily on personal savings and family support.
Key Takeaways
- Government funding for home care often does not cover everything an older Australian needs to remain safely at home.
- Many families must use private funds to pay for additional cleaning, personal care, and home modifications.
- Wait times for home care are around a year, forcing families to rely on private carers or unpaid family support in the meantime.
- Recent federal budget changes focus heavily on residential care, leaving a gap for those ageing at home.
- Expect to pay privately if you want timely and adequate care at home.
Australia’s aged care debate often focuses on residential care beds, refundable accommodation deposits and government funding formulas. But for most older Australians, the real pressure point is happening much earlier, at home.
The vast majority of people receiving aged care are not living in aged care homes. They are trying to remain in their own homes for as long as possible. Increasingly, however, getting care at home is becoming something people must partly fund themselves. To understand how aged care funding, fees, co-contributions and out-of-pocket costs work across home care and residential care, read our full Aged Care Funding Guide.
The Gap in Aged Care Funding
Last year the federal government increased the market price cap on aged care accommodation payments from $550,000 to $750,000. While the change was aimed at encouraging investment in new nursing homes, it exposed a much larger problem: government funding is no longer keeping pace with the cost of care.
For residential aged care providers, the numbers quickly stopped adding up. Homes could receive the equivalent of a $750,000 refundable accommodation deposit from market price residents, while government support for low-means residents remained tied to funding worth closer to $300,000 as a lump sum.
The result was predictable. Providers became unable to take financially disadvantaged residents, despite many desperately needing care. Some older Australians have remained stuck in hospital beds for months waiting for placement.
This year’s federal budget attempts to ease some of that pressure. From March 2028, homes with a high proportion of low-means residents will receive accommodation supplements of up to $127 a day which is equivalent to roughly $580,000 as a lump sum payment. It is a significant increase, but it still falls short of the indexed $750,000 market cap, and the changes are almost two years away.
Why Staying at Home Costs More Than Expected
The bigger issue is what this says about aged care more broadly.
When government funding falls short, the gap does not disappear. It simply shifts elsewhere; and increasingly that “elsewhere” is at home.
For older Australians trying to stay at home, government-funding often covers only part of what is needed. The Support at Home program can provide valuable assistance, but it doesn’t deliver unlimited care. Many people quickly discover they need to top up services privately if they want enough help to remain safely at home.
That may mean paying privately for additional cleaning, gardening, transport, meal preparation or personal care. It can mean purchasing equipment, modifying bathrooms, or paying for overnight support that government funding will not fully cover.
Families are also filling the gap with unpaid care. Adult children are reducing work hours, taking leave or stepping into caring roles because services are either unavailable or insufficient. For some families, private spending on home care has become the unofficial fourth pillar of retirement funding alongside superannuation, the pension and the family home.
Navigating Wait Times and Co-Contributions
The alternative is often residential care, but average wait times are almost a year which is creating bottlenecks. Around 3,500 older Australians are currently waiting in hospital beds because there is nowhere else for them to go.
For many people, remaining at home is still the preferred option. It can preserve independence, social connection and quality of life. But it is becoming increasingly clear that ageing at home is no longer simply a government-funded service. It is a co-contribution model in practice, whether policymakers openly describe it that way or not. With wait times for home care of around a year you also need the support from family or private carers while you wait for your package to arrive.
The federal budget changes may help stabilise parts of the residential care system over time. But they also reinforce a reality many families are already experiencing firsthand: if you want timely, flexible and adequate care at home, you should expect to pay to get it.
Find Home Care and Get Your Free Cost Report
We match you with providers based on your specific care needs and budget at no cost to you. Request your free My Aged Care Provider List today to save time comparing options. Plus, for a limited time, receive a Support at Home Cost Report produced in partnership with Rachel Lane.
FAQs
Does government funding cover all home care costs?
No, the Support at Home program does not deliver unlimited care or cover all expenses. Many older Australians find they need to top up their government funding privately. This helps pay for additional cleaning, personal care or essential home modifications.
How did the federal budget change residential care funding?
The federal government recently increased the market price cap on aged care accommodation payments to $750,000. The budget also introduced accommodation supplements for low-means residents starting in March 2028. However, government support for low-means residents still falls short of the market cap.
Why are some older Australians stuck in hospital beds?
Around 3,500 older Australians wait in hospital beds because there is nowhere else for them to go. This happens because some providers cannot financially afford to take low-means residents. Additionally, average wait times for alternative residential care or home care are almost a year.
How long are the wait times for home care?
The average wait time to receive a government-funded home care package is currently around one year. During this waiting period, many people rely heavily on private carers or unpaid support from family members.
Does Aged Care Decisions help families find home care providers?
Yes, Aged Care Decisions offer a 100% free and independent service to help older Australians find suitable aged care options. We do the running around for you to reduce stress. We can match you with available Support at Home providers in your area.
The information in this article is purely factual in nature and does not take into account your personal objectives, situation or needs. It is not intended to imply any recommendation, opinion or advice. You should seek advice from a qualified professional about your specific needs, financial situation and objectives.
