What is Aged Care?

There are a number of options available, with three of the most common being in-home care (known as Home Care Packages), residential aged care (previously known as nursing homes and hostels), and retirement villages.

It should be noted, however, that retirement villages are not the same as aged care facilities when it comes to the law: entirely different laws govern retirement villages than aged care facilities.

PW Lawyers can provide assistance with aged care (including retirement villages) in a number of capacities (including leases and contracts), and can assist regarding which factors need to be considered.

The Law: Big, Ongoing Changes

It is important to note that the law surrounding aged care services and facilities has undergone major reforms in recent years, with the roll-out commencing 1 July 2013 and continuing forward into the future.

These legislative changes have resulted in, among other factors, significant changes to care fees (including accommodation bonds), and how and which assets are assessed prior to an individual's entry to an aged care facility.

The recently-announced Royal Commission into Aged Care Quality and Safety, may bring about further legislative changes into the future.

Aged Care Facilities

Contracts

Before you move in to an aged care home, but after accepting the offer of a place, management will produce legally-binding documents for you to sign.

These documents will relate to your accommodation and care costs, how and when they are to be paid, the services and care to be provided to you, and your responsibilities and rights as a resident. While all of this information may sometimes be contained within one document, they are often presented as a Resident Agreement and an Accommodation Agreement.

Importantly, the home's management must enter into a legally-binding agreement with you regarding your accommodation within 28 days of your entry to the facility.

Costs And Fees

Costs for aged care vary depending upon someone's income and assets. Beginning 1 July 2014, amendments were made to the way in how the calculations of the subsidies and accommodation payments are performed. Some of these fees are based on the level of care required, some are on assets and income, and some fees are the same for everyone.

The four main types of fees are:

  • Basic daily fees;
  • Means-tested care fees;
  • Accommodation payments (either a Refundable Accommodation Deposit, a Daily Accommodation Payment, or a combination of both), and
  • Extra or additional optional services fees.

What Is A Retirement Village?

A retirement village is a residential complex primarily occupied by people aged 55 years and over, who have retired from full-time employment. If you are part of a couple, only one person needs to be retired in order to reside at such a complex. Some are run by community organisations (often churches and charities), while others are managed by commercial operators.

There are several ways for people to own or occupy premises in a retirement village. People often occupy retirement villages under long-term leases, under license or through Strata Title Ownership.

Long-Term Leases

Under a long-term lease, the occupier is entitled to live in the property for a period of time pursuant to the lease (commonly 99 years). The property developer maintains ownership of the property but the lease can be transferred by the occupier.

Beyond the lease agreement, a service agreement sets out the terms and conditions regarding the services provided. Long-term leases usually call for a trustee company to be appointed to take care of the financial aspects whilst a manager is appointed for day-to-day village management.

Licenses

Under a license, the property developer again maintains ownership of the property but the occupier provides a long-term loan or donation in return for the right to occupy the property. This is a more cost-effective approach as the cost of entry is substantially lower. The downside to this approach is forgoing the benefit of capital gains the property attracts as the market matures.

Strata Title

Strata Title Ownership is the most secure form of occupation with the added benefit of body corporate membership, granting certain rights to contribute to the management of the retirement village. The downside to this approach is a higher cost of entry due to stamp duty on the purchase, however, the advantage is accruing capital gains on the property as the market further matures.

PW Lawyers Can Help

At PW Lawyers, we always recommend seeking the advice of an experienced lawyer whilst reviewing alternative retirement villages and certainly prior to signing any documents regarding occupation.

We can also assist you with interpreting the Retirement Villages Act 1999 and can provide you with a full understanding of your legal position.

Contact PW Lawyers today.

 

Any information on this website is general in nature and should not be taken as personal legal advice. We recommend that you speak to a lawyer about your personal circumstances.