Your parent or friend needs residential aged care, and you are trying to make the right decision.
But as you begin talking to different homes, each conversation seems to reveal another fee,
making an already difficult process feel even more overwhelming.
So, what will residential aged care actually cost?

The short answer

A person entering permanent residential aged care may be asked to pay:
• a basic daily fee
• a hotelling contribution
• a non-clinical care contribution
• an accommodation payment or contribution
• an optional Higher Everyday Living Fee
Clinical care, including nursing care, is funded by the Australian Government. Residents do not
pay a separate fee for the clinical care the home is required to provide.
Not everyone pays every fee. What a person pays depends on their income, assets, means
assessment, accommodation arrangements and whether they choose any optional services.
This article focuses on the arrangements applying to most people entering permanent residential
aged care from 1 November 2025.

Does everyone pay the basic daily fee?

Every resident pays a basic daily fee. This covers ordinary living costs such as meals, cleaning,
laundry, utilities and day-to-day services.
The maximum basic daily fee is set at 85% of the single basic Age Pension. From 20 March
2026, it is $66.80 per day and is indexed twice a year.

What is the hotelling contribution?

Depending on their income and assets, some people will be asked to pay a hotelling contribution.
This is another contribution towards everyday living services, including catering, cleaning and
laundry.
Services Australia works out whether the person needs to pay it and how much. The maximum is
currently $22.15 per day. A person with fewer financial resources may pay a lower amount or
nothing at all.

What is the non-clinical care contribution?

People with greater income or assets will be asked to contribute towards non-clinical care.
Services Australia calculates the amount using the person’s income and assets. The maximum is
currently $107.32 per day. The lifetime cap is currently $137,917.01.

How are residential aged care accommodation costs paid?

Accommodation is separate from the fees residents pay for care and everyday living expenses.
The means assessment determines whether a person:
• receives government assistance with accommodation
• contributes towards the cost, or
• pays the accommodation price agreed with the home.