Australia’s home care sector is heading for a pricing crunch under the new Support at Home (SaH) program, with fresh analysis from StewartBrown showing providers will need to lift service prices by at least 30% to stand still – and even higher to achieve a return that makes the sector “investable.”
The survey of 82 providers, representing one-third of all Home Care Packages nationally, was conducted in August to capture the prices that operators had set for the original 1 July 2025 start date.
Prices reflect the policy shift under SaH: providers will no longer be able to charge separate Package Management fees (up to 15% of package value), and the cap on Care Management will be halved from 20% to 10%.
Policy changes drive increases
Senior Partner Grant Corderoy (pictured above) told The Weekly SOURCE that the jump is structural – not profiteering.
“The important message is this price increase is not about providers gouging,” he said. “It’s simply the shift from losing Package Management and halving Care Management.”
StewartBrown’s earlier modelling had shown service prices must climb by 30% to hold current margins, and by up to 38% to achieve the 9.5% margin required to make the sector investable.
By contrast, the Department of Health, Disability and Ageing’s own survey earlier this year suggested lower pricing levels. While not directly comparable, The SOURCE notes StewartBrown’s surveyed prices are around 15-20% higher than the Department’s estimates.
Providers trialling flexible models
The StewartBrown survey also highlights how providers are re-engineering pricing to recover real delivery costs:
- 47% price shorter visits at a higher hourly rate to reflect fixed overheads.
- 33% differentiate by service model (in-house, group, or outsourced).
- 27% vary prices for location (in-home, clinic, or telehealth).
- 20% charge more for assessments to cover report writing and admin.
The issue of equity also remains unresolved, with survey respondents split on whether to charge more in regional and remote areas to cover longer travel times and higher costs.
Caps, floors and changing costs
The Government is due to set price caps for home care services from 1 July 2026 – but the complexity of service delivery will make this task challenging.
For example, physiotherapy may be provided one-on-one or in a group, while some services may incur travel costs – with no uniform way of charging prices.
StewartBrown argues a floor price would be more effective than caps, ensuring providers cover minimum costs while allowing flexibility for different service models.
Adding to the uncertainty, 73% of providers surveyed say they are likely to, or are considering, changing their July price settings before the 1 November SaH commencement to reflect wage rises, inflation and other new costs.
The bottom line: while providers have adjusted prices for the SaH transition, StewartBrown says further increases are required if the sector is to remain viable – and investable.
