1. Step 1: Rupert’s total assessable income is $30,000 per annum.
This amount falls between the Self-funded Retiree threshold of $48,583.60
per year and the Income Free area for Full Pensioners which is $25,118.60.
This area is known as the Part Pensioners area. We will begin our
calculations there.
Step 2: Because Rupert earns more than the Full Pensioners income free
area of $25,118.60 (the level below which no fee is required) he will be
asked to pay an income-tested fee.
Level 7, 2 Collins Street | Melbourne Vic 3000
T: 613 9611 1700 | www.careguidance.au
HCP Fees Example: Let’s Meet Rupert
This is Rupert and he lives with his daughter and granddaughter.
Rupert will start to receive home care from 13 December 2014. His
annual assessable income is $30,000. We will begin by stating that
the total cost of Rupert’s Home Care Package is $82.20 per day.
The amount that Rupert will be required to pay will be the lowest
of three potential payments that are pre-calculated by the
government. Let’s see how much Rupert will have to contribute
financially to pay for his home care.
Individual person; income between
$25,118.60 and $48,583.60.
Member of a couple separated due to
illness; individual income between
$24,650.60 and $48,115.60.
Member of a couple living together;
individual income (calculated as half of
combined assessable income) between
$19,492.20 and $37,180.00.
Consumers with
assessable income
that falls between
the income free area
and the Income
Threshold are
considered
Part Pensioners.
Level 7, 2 Collins Street | Melbourne Vic 3000
www.careguidance.com.au
Consumers with
assessable income
that exceeds these
Income Threshold
amounts have a
higher annual limit
for income-tested
care fees and are
considered
Self-funded Retirees.
Income Threshold
(Self-funded
Retirees)
1
In between–
(Part
Pensioners)
2
Consumers with
assessable income
that falls below
these income free
areas cannot be
asked to pay an
income-tested care
fee and are
considered
Full Pensioners.
Income Free Area
(Full Pensioners)
3
Individual person; income of
$48,583.60 or more.
Member of a couple separated
due to illness; individual income of
$48,115.60 or more.
Member of a couple living together;
individual income (calculated as half
of combined assessable income) of
$37,180.00 or more.
Individual person; income less than
$25,118.60.
Member of a couple separated due
to illness; individual income less than
$24,650.60.
Member of a couple living together;
individual income (calculated as half
of combined assessable income) of
less than $19,492.20.
We know from the amount
of Rupert’s income that we
will begin the calculations
here.
Rupert’s contribution to his care is calculated as follows:
$48,583.60
Self-funded Retiree
Threshold
$30,000
Rupert’s Income;
Part Pensioner area
$25,118.60
Full Pensioner’s
income free area

2. 3: Half of Rupert’s income above the
income free area, calculated for the cost
of his care per day. We calculate that
amount as follows:
Level 7, 2 Collins Street | Melbourne Vic 3000
T: 613 9611 1700 | www.careguidance.au
1: The basic subsidy plus primary supplements that
totals $82.20 per day.
$82.20 is the first possible daily rate that Rupert
would be responsible to pay for his care.
Rupert will be required to pay the lowest of three potential payments that
are pre-calculated by the government.
2: The Part Pensioner’s 1st Cap (Rupert falls into the
Part Pensioner area) which totals $13.92 per day.
$13.92 is the second possible daily rate that
Rupert would be responsible to pay for his care.
Rupert’s income is $30,000 minus Full Pensioners income free area of
$25,118.60 = $4881.40
$4881.40 364 = $13.41 per day
$13.41 x 0.5 (government fee) = $6.70 per day
$6.70 is the third possible daily rate that Rupert
would be responsible to pay for his care.
•_
•
*Note: The basic fee is calculated at 17.5% of the basic age pension ($3,533.99 per year as at September 2014 rates).
In Conclusion:
Remember we started by saying that Rupert will be required
to pay the lowest of three potential payments that are pre-
calculated by the government.
The lowest of these three amounts is #3.
The maximum Rupert can be asked to pay in income-tested
care fees for his care is $6.70 per day.
Rupert’s provider can also charge him the basic fee.*