It’s no secret that in-home care for seniors generally isn’t cheap. However, depending on factors like insurance coverage, location, and the level of care required, in some cases, it may wind up being more affordable than long-term care facilities.
According to talent.com’s Australian website, home-based care workers charge an average of $29.60 per hour (based on 335 salaries). If you don’t require around-the-clock care, this may be more cost-efficient than paying large sums for a place in a nursing home or care home. That being said, home care can come with additional expenses, such as food and supplies. There can also be a hefty personal cost for family caregivers, including time off from work.
All of these numbers vary immensely depending on circumstance and/or location, and most people don’t commit to a home care financial plan. Few people are really prepared for their own financial emergencies, much less for those of a relative or ageing parent. But there are ways to work it into your budget.
Here, we share the steps to understanding and choosing how to pay for home care.
Assess how much—and what kind of—help an ageing adult needs
Home care covers a broad spectrum. A senior relative may need occasional help cooking or toileting, or they may need 24/7 care with complex medical services. Typically, the higher the need, the more home care will cost.
The level of care will determine whether or not a family chooses to hire help, how often they use that help, and the type of professionals they need. A senior might be looking for someone with experience managing a household and a bubbly personality, or they may need a support worker with a nursing degree and specific dementia training.
It’s also important to consider the type of care they will need. To begin with, is it medical or non-medical? You then need to consider that in-home care through an agency usually costs slightly more than private care, since the agency will also be looking to make a profit in addition to paying the carer. However, there are definite benefits to the former option, such as having a wide network of potential carers from which you can choose.
Quick tips
- If possible, have a conversation with the senior about their needs. Respect their wishes.
- Write down all the tasks that must be performed on behalf of the senior, including grooming, bill paying, assistance getting up and down stairs, or administering pills. Try not to leave any stone unturned, since even small chores can have financial or legal consequences.
- Calculate how much time during the day the senior will require assistance.
Research government benefits
When considering how you’ll foot the bill for home care, you might want to explore government benefits that you may be eligible for, such as Home Care Packages or the Commonwealth Home Support Programme.
Home Care Packages (HCP)
HCP are a government benefit that allows older Australians with more complex care needs to access affordable care services and help at home. Eligibility is based on the individual’s care needs, and is determined through an assessment (your financial situation does not affect your eligibility, but you may be required to undergo an income assessment in order to figure out how much you can contribute to the costs). The services you receive as part of the Home Care Package depend on the level of care you receive, but include things such as:
- Help with bathing, hygiene, and grooming
- Nursing/medical care
- Podiatry, physiotherapy, and other services
- Help with preparing meals
- Help with impairments or incontinence
- Help with cleaning, laundry, and other household chores
- Help with home or garden maintenance
- Help with making changes to your home
- Independence-promoting aids
- Transport
- Social outings, groups, and visitors
Commonwealth Home Support Programme (CHSP)
CHSP is a benefit available to older Australians who need help to stay at home and maintain their independence. Support may include things such as help with daily tasks, help around the house, help with making modifications to the home, transport, social support, and nursing care. CHSP also supports carers by offering them planned respite services.
Carer Allowance
Carers who provide additional daily care to someone who has a disability, a severe illness, or is frail aged may be eligible to claim this benefit. Both the carer and the person receiving care must be eligible.
Quick tips
- Find out which benefits you can claim.
- Seek assistance with claiming this support. Government bodies, such as myagedcare, may be able to help families navigate the benefits system.
Review personal assets
Unfortunately, there are currently no insurance products offering long-term care cover in Australia. Many caregivers are therefore forced to use their own or their ageing loved one’s personal assets to pay for home care. The reason: A lot of people are not prepared, and they may not be eligible for government funding, yet they find themselves in a situation where they need to find money immediately.
That’s why, if possible, people with ageing family members should consider saving money for the express purpose of long-term care at home.
Without savings to fund long-term care, you might want to consider the following options:
Take out a personal bank loan
Caregivers can take out a personal bank loan to front-load expenses. Interest rates varied in 2022, so it’s important to shop around through different lenders. Your rate will improve depending on your personal financial situation, including your credit score and annual income.
See if your elderly loved ones are eligible for the Home Equity Access Scheme (HEAS)
Your ageing loved one(s) may be able to help fund their care through the Home Equity Access Scheme, a reverse mortgage style loan offered by the government that allows property owners of Age Pension age to turn equity in their home into a regular stream of income. HEAS can even be used to supplement a Home Care Package.
Quick tips
- Consider opening a high-yield savings account reserved for home care only.
- Assess all of your government and private benefits options before you dip into personal assets.
- Seniors and family caregivers should collectively review assets, including savings and equity.
- Family members with the best credit and financial history may consider reviewing bank loan options.
Paying for at-home aged care can be a challenge. However, caregivers will be much more prepared if they arm themselves with research, thorough self-assessments, and the right professionals.
For general informational purposes only: not a substitute for financial or legal advice from a licensed professional based on your particular circumstances.