What is an accommodation bond?
You may be asked to pay an accommodation bond if you move into a low care or an extra-service facility. The bond is a payment in addition to the daily and income-tested fees, and is a contribution to the cost of your accommodation. Only facilities that have received Certification can apply an accommodation bond. Certification means that the facility has met Australian Government standards for the quality of the accommodation. This certificate must be produced by a facility upon request.
How much will I pay?
There is no fixed bond amount. If you have assets above $40,500, you may be asked to pay a bond. If you have a spouse/partner, half of your combined assets are counted. You must be left with assets of at least $40,500.
The home is excluded as an asset if your spouse/partner or dependent child is still living there. It is also excluded if:
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your carer has been living there for at least two years or a close relative has been living there for five years AND
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either were receiving or were eligible for an income support payment at the time of the assets assessment or on the day you enter care (whichever is earlier). Note that the Carer Allowance is NOT classified as an income support payment.
What if I can't pay a bond?
If you have less than $40,500 in assets you cannot be asked to pay a bond. Facilities receive a higher government subsidy for residents who cannot pay a bond. They are considered to be fully supported residents.
If you have assets between $40,500 and $108,266.40 you may be asked to pay a small accommodation bond but you must be left with assets of $40,500. You are considered to be a partially supported resident and the government will pay a higher subsidy for you.
Do I get the bond back when I leave?
The facility will retain a small portion of the bond. The maximum retention amount for bonds in excess of $40,500 is $318.00 per month for the first five years.
The retention amount is calculated monthly and may be taken from the bond for a maximum of five years or until the date you leave the facility (whichever is earlier). When you leave the facility the balance of the bond (initial bond amount minus the total retention amount) will be refunded. The facility also retains any interest earned on the bond money. The facility uses the retained amount and the interest earned on the bond to maintain and upgrade the facility.
How are my assets assessed?
Centrelink and the Department of Veterans’ Affairs (DVA) assess assets of new residents entering aged care. Previously, asset assessments were done by the aged care facilities.
It is not compulsory to have an assets assessment. The assessment is to check your eligibility to receive government assistance. If you decide not to have an assets assessment you may be asked to pay a bond.
To apply, complete the form Request for an Assets Assessment and submit it to Centrelink or DVA. You can do this anytime after you have been approved by the Aged Care Assessment Team (ACAT) for residential aged care. However the assets assessment is only valid for four months. The ACAT can provide copies of the form.
If you need assistance to complete the form, contact:
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If you receive a Centrelink payment OR do not receive any income support payment
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Centrelink, tel. 1800 227 475 (free call)
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If you receive a Dept of Veterans’ Affairs payment
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DVA, tel. 13 3254 (local call cost); 1800 555 254 (free call country callers)
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The outcome of your assessment will be sent to you, which you may pass on to an aged care provider.
What are my payment options?
There are several ways of paying a bond: as a lump sum, a periodic payment (fortnightly or monthly) or a combination of lump sum and periodic payment.
You will need to agree to an amount when you move into the facility and can discharge the lump sum over a six month period. You will be charged interest on the bond amount from the time you enter the facility. The maximum accommodation bond interest rate for all new residents from 1 January 2012 to 31 March 2012 is 8.62% and for all new residents from 1 April 2012 to 30 June 2012 is 8.37%
Centrelink's free Financial Information Service can provide financial information about these options. Contact Financial Information Service (FIS) tel. 13 2300 (local call cost).
What if I rent my home?
If you pay the bond by periodic payments, you may choose to rent your former home to make the payments. If the bond is paid from rent, all rent received will be exempt for the pension income test and for calculating daily fees. As long as the home is rented to pay the bond, the value of the home will be exempt under the pension assets test.
Accommodation bond agreements
You must be asked to sign an accommodation bond agreement outlining the terms and conditions of the bond within 21 days of entering the facility. The bond agreement may be included as part of a resident agreement.
Leaving the low care facility
When you leave, the bond, less the retention amount, must be refunded within fourteen days. In the case of the death of the resident, the bond balance must be refunded within 14 days after the day on which the facility is shown probate of the will of the resident or letters of administration of the estate of the resident.
If you move to another low care home, you may be asked to pay an accommodation bond to the new home.
If you have paid a bond and move to another facility as a high care resident within 28 days of leaving the low care facility, you have two options. With the agreement of the facility, you may either:
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have the balance of the bond refunded (bond paid minus retention amount) and, if liable, pay an accommodation charge; or
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transfer the balance of the bond to the new facility. In this case, only the balance, if any, of the five-year retention period will carry over to the new facility.
Hardship provisions
If payment of an accommodation bond will cause undue financial hardship, you may apply for assistance. Contact the Department of Health and Ageing, tel. 1800 052 222 (free call) and request the form Aged Care Application for Financial Assistance.
