Federal Budget 2026-27: the key measures for aged care

The Albanese Government will invest an additional $3.7 billion into residential aged care and Support at Home services over the next four years.

The Federal Budget 2026-27 outlines a range of funding measures for the aged care sector, including:

• An additional $389.8 million over four years from 2026-27 (and $40.5 million per year ongoing) to implement Support at Home program refinements, including to assessments, hardship applications and the end‑of‑life pathway, and to bring forward the release of Support at Home packages in 2026-27 (previously announced in December 2024 as 24,000 Support packages).
• As previously announced, $1 billion has been allocated under Support at Home to fully fund personal care services, including showering and continence management, for those who need it.
• Extending End-of-Life Pathway funding, supporting a review of the Integrated Assessment Tool (IAT), and digitisation of the financial hardship assistance process.
• $1.7 billion in measures to incentivise construction of up to 5,000 aged beds a year, with a focus on making places available for those with limited means. This includes $606 million in new capital subsidies for aged care providers who build or expand aged care homes.

Under these measures, new homes will receive a new payment of $30 per supported resident per day.

Existing homes that undergo a significant expansion – increasing the number of beds by 40% or more – will receive an extra $15 per supported resident per day.

• Supported residents will also from increases to the accommodation supplements paid to providers from 2027. Homes that have more than 60% supported residents will get an additional top-up payment from 2028.
• The Federal Government is consulting on options to further boost the number of aged care beds, as recommended by the Aged Care Accommodation Review. Options include an interest free or low interest loans scheme, increased accommodation pricing flexibility for higher means residents and an expanded Aged Care Capital Assistance Program.
• Changes to the means assessment for residential aged care means First Nations people who have received a State or Territory Stolen Generations redress scheme payment will no longer have that payment means tested as an asset for residential care.
• $224.3 million over four years for specialist dementia care, which will include 20 additional specialist facilities and expand the Hospital to Aged Care Dementia support program, operated by HammondCare, from 11 to 20 locations to help people transition from acute care to aged care.