NDIS and residential aged care: fees, support and choices
The NDIS Meets Aged Care: The links between two departments
By Ross McDonald · Originally published 31 July 2019
Ask for a clear breakdown of what you pay
Request a written explanation of each fee, what your plan covers and what remains your responsibility. Keep the resident and accommodation agreements together with the assessment and plan information. Ask about anything that does not match the service you receive.
Ross McDonald B.Comm (Hons), CA, MBA, is the founder of Capital Guardians, a ‘paypal’ for aged care and disability offering personal payment service for individuals in supported environments.
Australia has two separate mega billion-dollar government departments, with different legislation, infrastructure, budgets, rules and reporting. However, both have the same agenda in terms of services, rights and control to the care recipient. Both are either consumer directed or have a road map (i.e. residential aged care) to become consumer directed, with seamless funding linked to the care recipient.
The duplication of funding two separate entities with a similar social goal will continue to be challenged, especially to the extent that it impacts care recipients and service providers across the two independent government jurisdictions.
Notwithstanding current difficulties, links between the two departments have started. Interestingly this has been a result of the lobbying behind the simple goal of getting approximately 6,000 young people out of government-funded residential aged care facilities (nursing homes).
Thanks to the Summer Foundation, with a mission to stop young people being forced to live in nursing homes, other passionate advocates, and several years of funded research and lobbying, the NDIS introduced formal funding for NDIS recipients in aged care facilities in September 2017. Although complex, it is workable. To break it down, the NDIS Plan for a care recipient will include:
1. The Dept of Human Services Medicare funding (subsidy)
For the care recipient and their representatives, it’s best to totally ignore this. It’s simply a record of the funding arrangement between the NDIS and the Department of Human Services. The value is noted as a Stated Support. It can be confusing, generally approaching $100,000, and just represents business as usual for the nursing home.
Other non-NDIS residents do not get burdened with these numbers and the complexities of aged care funding. They are provided with information on personal contributions, starting with a value equal to 85% of the aged care pension.
Action: Ignore
[Clickability update, October 2026: The claim of uncapped funding is not a universal instruction. Current Health department guidance says the NDIS may assist with this fee. Confirm the assessed fee and actual plan arrangements.]
2. Means tested care fee
Nursing home residents, for whom a means-tested fee is confirmed after considering the value of their assets and income, are personally charged. NDIS will pay any means- tested fees, having been presented with research on the costs and consequences of fees that young people are facing on admission to residential aged care. NDIS funding for a means-tested fee is uncapped.
Action: Ensure 100% of any means tested fee is in the NDIS plan
[Clickability update, October 2026: The historical dollar figure is not current. The current fees page distinguishes daily contributions, accommodation payments and lump sums. NDIS non-funding of a lump sum does not mean everyone must avoid that payment option.]
3. Daily accommodation contribution or payment (“DAP” or “RAD”)
Accommodation charges in nursing homes are like paying rent. There are a lot of options and complex acronyms, so to simplify these:
The rent is means tested and charged to individuals who can afford it.
The NDIS will pay an amount only up a maximum of $55.04 daily in new facilities, that is determined by the Dept of Human Services as payable to operators for all residents.
There is a lot of choice for prospective residents in nursing homes where they have the money to contribute financially. Where this choice is made by paying for extra services or a fixed lump sum amount (formally an accommodation bond), the NDIS will not fund these choices.
Action: Do not pay any accommodation charge as a lump sum, negotiate a rental style arrangement with the nursing home
4. The icing – capacity building
The NDIS is practically geared towards realising the potential of individuals with disability who have their lives ahead of them. In doing so, in addition to all the above, there can be considerable funding provided for:
Assistance to support an individual to attend and participate in community, social and recreational activities.
Capacity building support for people with a disability (employment, education and re-enablement with allied health).
Getting the NDIS funding fully operative with the capacity building is an ideal step to ensuring the 6,000 young people in nursing homes have a choice outside aged care facilities for their living arrangements.
[Clickability update, October 2026: Use the NDIA younger-people guideline and current individual agreements. Do not assume a plan manager can simply pay every part of a nursing-home invoice from NDIS funds.]
5. Practically making it happen!
Clearly, it is not an easy prospect and it will not happen unless there is a highly determined representative of the resident, who self-manages or uses a Plan Manager with the ability to pay a total nursing home invoice, ensuring the NDIS and individuals pay their respective portions.
Self-management and plan management are terms introduced by the NDIS. Both roles are focused on book-keeping tasks, assigning responsibility to claim from the NDIS via their on-line claims portal and pay expenses as they arise. The roles include record-keeping and creating monthly statements, similar to what is required by aged care home care package providers.
Self-managed NDIS participants do all the book keeping themselves. If there is not the capability, or desire, any NDIS participant can get the help of a plan manager, at no cost to do this work for them.
Conclusion
The NDIS structure is setting a good example for the coming changes in aged care as the Department of Human Services develops the road map with funding following the individual wherever they choose to live, and enabling choice of care, separate to that of the accommodation.
Clickability editorial update: October 2026
Keep housing choices and fee checks connected
Start with the participant’s preferences about where and how they want to live. Identify the information needed to explore alternatives, including daily support, equipment and access. Do not treat aged care as the only option simply because the person currently lives there.
Help the participant obtain an understandable fee breakdown and clarify which system is responsible for each service. Refer financial decisions to appropriately qualified advice and check the individual plan before making commitments. A historical example is not authority to direct a lump-sum or daily-payment choice.
Questions readers ask
Is the $55.04 accommodation figure current?
No. It is a historical amount and must not be used for today’s decisions. Official guidance
Does the NDIS pay the basic daily aged-care fee?
The Health department guidance says the resident must pay it; the NDIS does not fund ordinary daily living costs. Official guidance
Find help exploring support and housing arrangements
Tell Clickability what you need help coordinating. Compare reviewed and rated providers and ask about experience with younger people in residential aged care and alternative living options.
