How do I pay for aged care?

Maximum Permissible Interest Rate ("MPIR"):

The MPIR is an interest rate set by the Australian Government. It is used to work out the equivalence between the DAP and the RAD (explained below). All aged care homes use this same value, and although this value changes from time to time, the MPIR for a particular resident will be set when they are entered into care and will not change unless the resident changes rooms or homes.

Refundable Accommodation Deposit (“RAD”):

A RAD is a one-off lump sum payment to an Aged Care home. The full RAD amount is refunded upon departure of the home, less any amounts you have agreed to be deducted (if applicable) and is 100% guaranteed by the Australian Government.

Daily Accommodation Payment (“DAP”):

A DAP is a daily payment of interest on the room price if the RAD has not been paid in full. This is billed monthly (i.e. a rental-type payment).

Unlike the RAD, the DAP is not refundable upon departure from the home.

The DAP pricing is based on the Government set interest rate at the time of entry. This is known as the Maximum Permissible Interest Rate (MPIR). This amount may vary from time to time but will be fixed on the date of permanent entry, for the duration of the resident’s stay, based on any unpaid component of the Refundable Accommodation Deposit.

To calculate the equivalent DAP, multiply the unpaid RAD amount by the MPIR and divide by 365 for the daily rate.

Basic Daily Fee ("BDF"):

This is set by the Federal Government and is applicable to all residents in all homes (not just Signature Care). This fee helps cover everyday services including meals, cleaning, facilities management, and laundry. The value of this fee is worked out at 85% of the single basic age pension amount. It is updated on the 20th of March and the 20th of September each year.

Means Tested Care Fee ("MTCF"):

The Means Tested Care Fee is an individually-based fee that some residents may be required to pay. Like the BDF, this fee is set by the Government and applies to eligible residents in government-funded aged care homes.

There is a maximum yearly cap, and a maximum lifetime cap that applies and the fee will cease once these amounts have been reached. The fee is determined by a resident's income and financial assets. It is important to disclose this information as soon as possible to avoid having the maximum fee applied.

In short, the MTCF is a Government fee that may apply depending on your income and assets.

Extra & Additional Service Fee:

Some aged care providers may implement an Extra Service Fee and/or an Additional Service Fee in addition to the other fees and charges that apply. These extra/additional services are hotel-type offerings which might include an upgraded food menu, alcohol served with meals or in-room Foxtel, as an example.

Signature Care does not charge Extra Service Fees or Additional Service Fees yet offers many hotel-type services at no additional charge.

Ways to pay

Just the RAD:

A resident can choose to pay the RAD in its entirety. Doing so means that the DAP will be $0 and the only fee left is the Basic Daily Fee and, if it applies, the Means Tested Care Fee.

No RAD, all DAP:

Rather than pay any of the RAD at all, a resident can pay the full DAP amount (along with the BDF and any MTCF that may apply).

A mix of both:

A resident could pay a portion of their RAD and have the DAP reduced by a proportional amount. For example, depositing 50% of the total RAD would bring the DAP down by 50%.

For a combination RAD/DAP payment, multiply the remainder of the RAD by the MPIR and divide by 365.

Government-funded (either partially or fully):

Signature Care offer fully supported rooms where no accommodation contribution is required, or partially supported rooms, where only a small accommodation contribution is required (set by the government based on the resident’s income and assets).

To check if you are eligible, please complete an Aged Care Income and Assets Assessment Form from the Department of Human Services ( and submit to Centrelink.

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