As Australia’s population ages, the cost of aged care services whether in-home or in residential facilities is a growing concern for many, particularly full pensioners who rely on limited incomes. Financial hardship assistance is therefore a critical lifeline for those who, due to circumstances beyond their control, struggle to meet aged care costs. This government-supported program ensures that eligible individuals can access the care they need without facing undue financial strain.
Here we look at the ins and outs of financial hardship assistance, including eligibility, application processes, and alternative options, with a focus on supporting full pensioners and other vulnerable individuals.
What Is Financial Hardship Assistance?
Financial hardship assistance is designed to support individuals struggling to pay for aged care services. If approved, the government may subsidise fees for Home Care Packages, residential aged care, or short-term respite care.
For full pensioners, this assistance can be crucial, ensuring they can access essential care without sacrificing basic living expenses. The level of support depends on the type of care and the individual’s financial situation, with each case assessed individually.
What Help Can I Get?
The assistance varies based on the care setting:
- Home Care Packages: These support older Australians living at home, covering fees like basic daily fees or income-tested care fees for services such as personal care or nursing.
** If you started receiving a Home Care Package before July 1, 2014, you are not eligible for the financial hardship assistance program. You can, however, discuss reduced fees directly with your home care provider. - Aged Care Homes: Assistance may cover accommodation payments, daily care fees, or means-tested fees for residents in aged care facilities, which is vital for pensioners facing high costs.
- Residential Respite Care: Short-term stays in aged care homes can also be subsidised, making temporary care accessible without financial strain.
The government tailors support to the individual’s needs, ensuring affordability for full pensioners with limited financial resources.
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Who Is Eligible for Financial Hardship Assistance?
Eligibility is determined through a financial assessment, with specific criteria that must be met. You are not eligible if you:
- Have not completed an aged care means assessment, which calculates your ability to pay for care.
- Have assessable assets exceeding $45,969.30 (excluding unrealisable assets).
- Have gifted more than $10,000 in the past 12 months or $30,000 in the past five years.
**Amounts are correct at time of publishing and are subject to indexation.
Unrealisable assets are those you cannot sell or borrow against, such as:
- A house on the market for six months or more without selling.
- Jointly owned property.
- Assets frozen due to legal or financial constraints.
- Assets affected by gifting decisions made by a Power of Attorney or when incapacitated.
Assets like rental properties, private trusts, or lump sums paid for aged care accommodation are not unrealisable and count toward the asset threshold.
Full pensioners can request an asset be assessed as unrealisable during the application process, which may improve eligibility.
Understanding Unrealisable Assets
Unrealisable assets are critical to eligibility, as they are excluded from the $45,969.30 asset threshold. For example, a primary residence unsold after six months or co-owned property may qualify. However, rental properties or funds in private trusts do not.
Full pensioners should carefully document their assets with Services Australia to ensure accurate classification, as this can determine eligibility.
I Meet the Eligibility Criteria – What Happens Next?
If you meet the criteria, follow these steps:
- Apply: Complete the Aged Care Claim for Financial Hardship Assistance form (SA462), available through Services Australia. Provide detailed financial information, including income, assets, and expenses.
- Assessment: Services Australia reviews your application within 28 days, possibly requesting additional information. They assess your essential expenses; costs for daily living like food and utilities, and check if your remaining income exceeds 15% of the basic age pension ($161.96 per fortnight).
- Outcome: You’ll receive a letter confirming whether your application is approved. If approved, the government will cover some or all of your fees. If denied, contact Services Australia to discuss further steps.
Full pensioners must accurately document essential expenses, as their fixed income leaves little room for discretionary spending.
How Do I Apply for Financial Hardship Assistance?
To apply, complete the SA462 form, available online or by calling Services Australia at 1800 227 475. Include details of your pension income, assets, and essential expenses. Be sure to submit the form promptly, as delays in providing requested information can extend the 28-day assessment period. For full pensioners, thorough documentation strengthens the application.
What Is the Assessment Process?
Services Australia evaluates your application by reviewing:
- Income and Assets: Ensuring they meet eligibility thresholds.
- Essential Expenses: Confirming you cannot afford aged care costs after covering living expenses.
- Other Assistance: Checking eligibility for programs like the Home Equity Access Scheme.
A decision is communicated within 28 days of receiving all required information. Full pensioners should provide clear records of their pension and expenses to support their case.
I Don’t Meet the Eligibility Criteria – What Do I Do Next?
If you’re ineligible, consider these options:
- Speak With Your Provider: Let your provider know you would like to review and renegotiate your list of services.
- Financial Advice: A financial adviser can suggest ways to manage costs, such as accessing superannuation or restructuring assets.
- Contact Services Australia: Discuss your situation to explore other programs or reassess eligibility if circumstances change.
- Alternative Assistance: The Home Equity Access Scheme allows borrowing against your home’s equity, which may help cover costs.
Full pensioners can benefit from financial advice to maximise pension entitlements and reduce care expenses.
Are There Other Types of Financial Assistance?
Before approving hardship assistance, Services Australia checks eligibility for other programs, such as:
- Home Equity Access Scheme: Allows borrowing against your home’s value to fund aged care.
- Pension Supplements and Concessions: May reduce costs for utilities or healthcare, easing financial pressure for pensioners.
These options can provide relief for those ineligible for hardship assistance.
Can I Seek Financial Information or Guidance?
Yes, seeking guidance is recommended. Services Australia offers:
- Aged Care Specialist Officers (ACSOs): Provide tailored information on aged care financing.
- Financial Information Service (FIS): Offers free education on managing finances, including reverse mortgages and the Home Equity Access Scheme. FIS is available to everyone, regardless of government payment status.
The MoneySmart website also provides resources on reverse mortgages. For personalised advice, consult a licensed financial adviser. Full pensioners can use these services to better manage care costs alongside their pension.
Contact Services Australia
Services Australia manages all hardship applications. Contact them at 1800 227 475 to:
- Request the SA462 form.
- Check application progress.
- Discuss outcomes or alternative options.
If you are worried about what the upcoming Support at Home changes and New Aged Care Act reforms means for your finances, speak to our helpful team for advice. We will guide you through your options and necessary processes in a way that’s as easy and stress-free as possible. Our service is 100% FREE, fast and independent, putting you at the heart of everything we do.
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