Moving to Residential Aged Care: Why Is an Income and Assets Assessment Required Before Going Permanent?

Why is the assessment so important?

The Income and Assets Assessment helps determine how a resident’s ongoing aged care costs will be calculated. It provides important information about:

• whether the accommodation will be subsidised by the government (a supported ‘low means’ resident) or at the agreed market rate (a ‘financial’ resident)
• the fee structure that will apply after permanent admission which is whether the resident is under the grandfathered arrangements or the newer fee structure, and what those assessed fees will be initially.

Understanding these costs before permanent care begins allows families to make informed decisions and reduces the risk of unexpected financial surprises.

Why are more aged care homes asking for the assessment before permanent admission?

In the past, many families would move into permanent care first and complete the Income and Assets Assessment afterwards. While the assessment was still required, there was often more flexibility around when it was completed.

Now, aged care homes are asking families to provide evidence that the assessment has already been completed before permanent admission.

The reason is simple. The assessment is how the resident will be financially assessed. It helps the aged care home understand whether the resident will receive government assistance towards their accommodation costs. It also provides greater certainty about the fees to apply once the resident enters permanent care.

Before permanent admission, Services Australia will generally issue a pre-assessment, which provides an indication of the likely outcome. Once the resident has formally entered permanent residential aged care, a final assessment is issued, confirming the fees that apply.

When timing creates challenges

Most families move through this process smoothly, but occasionally the timing can create confusion.

Recently, our team assisted the family of a 92-year-old woman who was moving from respite into permanent residential aged care. The family had completed the Income and Assets Assessment early and received a pre-assessment letter outlining her likely financial classification and estimated fees.

The aged care home then requested the final assessment letter before permanent admission could proceed.

Unfortunately, Services Australia could not issue the final assessment until the resident had officially entered permanent care.

Situations like this can feel frustrating because everyone is trying to do the right thing. Fortunately, they are usually resolved once everyone understands the assessment process and what documentation is available at each stage.

You don’t have to navigate the process alone

Completing an Income and Assets Assessment is about much more than lodging a form. The outcome influences accommodation costs, ongoing care fees and provide greater clarity about the fee structure that will apply after permanent admission.

Many families assume they need to deal directly with Services Australia themselves. While that’s certainly an option, you don’t have to manage the process alone.

Our team regularly assists families by preparing the Income and Assets Assessment, communicating with Services Australia throughout the process, reviewing the outcome to ensure it is correct, and providing support beyond the initial assessment when there are changes, such as selling assets.

This gives families confidence that the assessment has been completed correctly, the fees have been properly calculated and that they understand their options before making one of the most significant financial decisions associated with residential aged care.