Is aged care entirely free or subsidized by the government?
Financials, Fees & Funding
General
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In short...
Aged care in Australia is heavily subsidized by the Australian Government, but it is not entirely free. The government pays significant subsidies to approved providers on your behalf, but individuals are still expected to contribute to their care and living costs depending on their income and assets. The exact costs depend heavily on whether you are remaining at home or moving into an aged care facility:1.
The details...
Is aged care entirely free, or is it subsidised by the government?
Australian Government-funded aged care is generally subsidised rather than completely free.
The government pays some or most of the cost of approved care. How much you personally pay depends on:
the aged care program you use
the type and price of each service
your income, assets and pension status
whether transitional or no-worse-off arrangements apply
any optional services you choose.
Income and assets usually affect what you contribute—not whether you are allowed to apply for an aged care assessment.
Support at Home
Under Support at Home, contributions are generally calculated as a percentage of the agreed price of each service you receive.
Services fall into three contribution categories.
Clinical supports
Approved clinical services are fully government funded, so the participant pays no contribution.
These can include:
nursing
physiotherapy
occupational therapy
podiatry
speech pathology
dietetics
other approved clinical services.
The service must still be included in your support plan, and its full price is paid from your available Support at Home funding. No contribution does not mean unlimited services.
Independence services
These may require a moderate contribution.
They can include:
transport
respite
social support
assistance with shopping or appointments
some support with daily activities.
Everyday living services
These attract the highest participant contributions.
They can include:
cleaning
laundry
gardening
meal preparation
delivered meals
minor household maintenance.
Services Australia assesses income and assets and provides the contribution percentages that apply. The percentage is applied only when a service is delivered, and the government pays the remaining portion of the agreed service price.
What are the standard Support at Home contribution rates?
For a full pensioner:
clinical supports: 0%
independence services: 5%
everyday living services: 17.5%.
For a part pensioner or eligible Commonwealth Seniors Health Card holder:
clinical supports: 0%
independence services: between 5% and 50%
everyday living services: between 17.5% and 80%.
For a self-funded person without a Commonwealth Seniors Health Card:
clinical supports: 0%
independence services: 50%
everyday living services: 80%.
The exact rate for people in the tapered range is determined from their assessed income and assets.
What about personal care?
As at July 2026, participant contributions can still apply to personal care.
From 1 October 2026, approved personal care will move into the clinical-support category and become fully government funded, meaning there will be no participant contribution for approved personal care services.
Practical example
Suppose a provider charges $110 for one hour of cleaning.
Cleaning is an everyday living service.
A full pensioner with a 17.5% contribution rate would pay:
participant contribution: $19.25
government-funded portion: $90.75.
A self-funded person without a Commonwealth Seniors Health Card, paying 80%, would contribute:
participant contribution: $88
government-funded portion: $22.
The person’s contribution is paid in addition to the government subsidy—it does not usually reduce the amount of government funding allocated to their classification.
Commonwealth Home Support Programme
The Commonwealth Home Support Programme, or CHSP, provides entry-level services such as cleaning, meals, transport, social support and home maintenance.
The government subsidises these services, but providers can ask participants to make an affordable contribution.
CHSP fees are generally set by the provider rather than through the Support at Home percentage system. A person should not be denied necessary services simply because they cannot afford the requested contribution, and financial hardship arrangements may be available.
Ask the provider:
what the service contribution is
whether concessions or hardship arrangements apply
whether each visit or service has a separate charge.
Residential aged care
Residential aged care is also government subsidised, but residents may be asked to pay several different costs.
These can include:
a basic daily fee for ordinary living costs
a means-tested contribution towards care
an accommodation payment or contribution
optional higher everyday living or additional service fees.
The amount depends on the person’s financial circumstances, the aged care home and the accommodation selected. The government subsidises approved care and provides 24-hour care and access to nursing, but residential aged care is not generally free.
What may need to be paid privately?
Even when someone receives government-funded aged care, they may need to pay the full cost of:
services beyond their approved funding
additional hours after the budget is exhausted
ordinary groceries and household expenses
optional services or upgraded accommodation
privately arranged workers
services not included in their support plan
purchases outside the government-approved service list.
For example, Support at Home may fund approved meal preparation, but it does not ordinarily pay for all groceries. It may fund scheduled nursing visits but not unlimited 24-hour nursing.
What if I cannot afford the contributions?
Do not assume you must decline care.
Financial hardship assistance may be available where paying aged care fees or contributions would cause genuine financial difficulty.
You can speak with:
Services Australia
My Aged Care
your provider or care partner
an Aged Care Specialist Officer
the Older Persons Advocacy Network.
People protected by transitional or no-worse-off arrangements may also pay less than the standard Support at Home contribution rates—or no contribution—depending on their previous Home Care Package fee arrangements.
The practical answer is:
The government pays a substantial part of approved aged care, but many people contribute towards some services. Clinical Support at Home services are fully funded, while practical household support and residential aged care commonly involve personal contributions.
What should I do next?
Confirm the details with My Aged Care or the relevant provider, write down your questions and ask for important information in writing before making a decision.
Helpful Local Home Help resources
Takeaways
- Individual eligibility, availability and outcomes can vary.
- Ask questions early and seek independent help if anything feels unclear or unsafe.
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Our independence Local Home Help is designed to help families navigate the often confusing world of home support and aged care services. The platform aims to present information in a clear and balanced way so families can better understand the types of help available and where to find it. While providers may appear on the platform, Local Home Help does not recommend one provider over another. The decision about which service may be suitable will always depend on individual circumstances. Families are encouraged to contact providers directly, ask questions and make their own enquiries before making a decision. Our focus is to make the process of understanding and finding support at home easier. Local Home Help does not accept payment of any kind in exchange for provider visibility, ranking, or shortlist placement, and never will. Any future revenue Local Home Help generates will come from sources entirely separate from how providers are matched to consumers.
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About the Author
Local Home Help Editorial Team
This article was created by Local Home Help to help Australian families better understand aged care and home support options in plain English.
Our content is based on publicly available information from:
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My Aged Care
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Department of Health, Disability and Ageing
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Aged Care Quality and Safety Commission
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Provider pricing schedules and operational experience within the aged care sector.
Local Home Help is an independent consumer information platform and does not provide medical, legal or financial advice.
Important information
Aged care rules, fees, eligibility requirements and program arrangements can change. The information on this page is general guidance only and may not apply to every person or situation.
Before making a financial, legal or care decision, check the latest information with My Aged Care, Services Australia, the Department of Health, Disability and Ageing, or another appropriate official source.
Local Home Help does not provide legal, financial, medical or clinical advice.
Source data
Last reviewed
20/7/26, 9:08 pm