Royal Commission: Wealthy older Australians barely contributing to aged care costs – Former Aged Care Financing Authority Chair

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The fourth day of hearings into the sector’s funding and financing opened with former Chair of the Aged Care Financing Authority Mike Callaghan, who argued the sector’s current funding model was inequitable when you consider the “large growth in inheritance” with wealthy Australians.

“I think it’s totally inequitable, right across that, to think that people (in the highest income brackets) are not paying for the full range or making a bigger contribution to the services that they require as they age,” he said.

Assets test and estate payments to support the sector

Mr Callaghan argued Australians should be prepared to spend more for better aged care services, rather than growing assets for the sake of growing them.

“We have a situation now where most people, they don’t spend their money that they have in retirement. When they die they haven’t dipped into them,” he said.

“And there’s very large growth in inheritances. Instead of that growth in inheritance, people should be using the assets, when they have them, they should be using more of those assets to fund the range of goods and services that they need as they age.”

Aged care should not be separated from the rest of a person’s life – Professor Kathy Eagar

Australian Health Services Research Institute Director Professor Kathy Eagar also appeared in front of the Commission, arguing that aged care should not be treated as a silo.

“I would expand the range of accommodation options. I would want to see both smaller homes into the future and more specialised homes,” she said.

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