Australia’s aged care system experienced a major overhaul on November 1, 2025, with the launch of the new Aged Care Act. This rights-based framework aims to prioritise older Australians in their care choices.
Responding to the Royal Commission’s severe findings on neglect and abuse, the reforms promised increased transparency, improved quality standards, and greater support for ageing populations. Central to these changes is the shift from Home Care Packages (HCP) to the “Support at Home” program, which provides financial help to assist seniors in staying in their own homes rather than moving into residential facilities. However, while the intention is admirable, emerging evidence indicates these financial packages are unintentionally causing more harm than good for those trying to age independently, increasing financial pressure and restricting essential services.
“No Worse Off” Principle
Under the old HCP system, older Australians received tiered funding, ranging from basic to comprehensive levels, to cover services such as personal care, domestic help, and allied health. The 2025 reforms maintain a “no worse off” principle for existing recipients, ensuring their contribution arrangements aren’t hiked. For new entrants, however, the Support at Home program introduces means-testing and price caps on non-clinical services, with clinical care, such as nursing, now free. On paper, this sounds equitable: subsidies tailored to income, promoting choice and dignity. Yet in practice, the packages fall short, forcing seniors into heartbreaking trade-offs.
Surge in Costs for Everyday Supports
The most glaring issue is the surge in costs for everyday supports. Basic assistance, such as showers, meal preparation, or wound care, has seen price increases of 20-30% under the new pricing model, outpacing inflation and eroding the value of allocated funds. Advocates report that a Level 2 package, once sufficient for weekly cleaning and transport, now barely covers half those needs, leaving recipients to choose between a hot meal or a safe bath.
This isn’t abstract; it’s real hardship. One Sydney senior, quoted in recent reports, lamented, “Do I eat tonight or get help to the toilet tomorrow? It’s no way to live.” For low-income households, these gaps translate to isolation, untreated health issues, and increased hospital admissions, ironically driving up system-wide costs.
Administrative Bureaucracy
Compounding the problem is administrative bureaucracy. The reforms’ emphasis on personalised plans requires extensive assessments and provider approvals, leading to months-long delays in package activation. Workforce shortages, already acute, mean fewer providers can deliver services at the capped rates, further shrinking options.
Meanwhile, the means test discourages asset sales for care funding; families rushing to liquidate homes now face “shocking hidden costs” like restored means testing post-reform, potentially clawing back subsidies. Far from empowering independence, these financial hurdles are funnelling vulnerable elders toward residential care—the very outcome the reforms sought to avoid.
Financial Pitfalls
While the Aged Care Act introduces vital protections, such as mandatory staffing ratios and safeguards against abuse, its financial mechanisms require urgent recalibration. Without addressing these pitfalls, the Support at Home program risks becoming a barrier rather than a bridge to dignified aging.
Policymakers must listen to frontline voices: adjust pricing, streamline access, and bolster funding to truly honour the promise of home-based care. For the million-plus Australians over 65, the stakes are nothing less than their freedom to age on their own terms.
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Author: Cathy Kerr BANurs, GDAET, Cert IV Training and Assessment.
Cathy brings over three decades of expertise to the field of nursing education, with a distinguished career as a registered nurse, educator, and now aged care consultant. Her extensive experience spans clinical practice, training, and consultancy, where she has dedicated herself to improving care standards and supporting both ageing individuals and healthcare professionals. With a deep understanding of the sector’s challenges and opportunities, Cathy combines her nursing background with a passion for education to drive positive outcomes in aged care.
