Attwood Marshall Lawyers Senior Paralegal and Accredited Aged Care Professional, Bindy Marshall, tackles some of the most common misconceptions circulating about aged care.
Misinformation can spread quickly in aged care, with second-hand advice from neighbours, friends, or well-meaning family members clouding important decisions about supporting an ageing loved one.
From outdated perceptions about what aged care facilities are really like, to confusion about costs and eligibility, these myths can create unnecessary fear and prevent families from making informed choices. Here, we unpack the facts behind the fiction.
Myth 1: Aged care facilities are sterile, clinical institutions where residents lose their independence
This is the most persistent myth.
While facilities may have been sterile, bed-in-a-room environments 15 years ago, aged care has transformed dramatically since then. Today’s facilities are much more homely and feature coffee shops, movie theatres, relaxation rooms, pools and extensive interactive lifestyle programs. Residents can join small group outings to local shopping centres, enjoy high tea at three o’clock, participate in harpist chill-down sessions, and attend morning exercise classes tailored to their abilities.
People may still think residents are left in a small room for the rest of their lives, but this is not the case.
Modern aged care facilities are designed to help residents maintain their independence. Residents can set up their rooms with their own belongings, choose which activities to participate in, and make their own daily decisions.
Physiotherapists, podiatrists and lifestyle coordinators rally around residents to enhance their lives and give them a step up in their health, keeping minds sharp and bodies active.
The evidence speaks for itself. Tenure in care has increased from just two years a decade ago to over five years now. Residents are living longer because their lives are enriched, not restricted.
Myth 2: Aged care is unaffordable, especially under the new Act
With the new Aged Care Act taking effect on 1 November 2025, many people are concerned that care has become financially out of reach. The reality is quite different.
Care is affordable for everyone, whether pensioner, partially supported or fully funded. The government uses an income and assets test to determine which financial category a resident falls into and how much they will need to contribute toward their care.
For fully supported pensioners with around $20,000 in the bank and no other assets, the contribution is only $65.55 per day, which is approximately 85 per cent of the full age pension. The remaining 15 per cent covers medications, haircuts, outings and personal items.
At the other end, someone who owns a house (with no partner living in it), a car, and has $1.2 million in managed funds will be considered a fully funded resident and will need to pay additional fees, including a Refundable Accommodation Deposit (RAD).
The government doesn’t penalise pensioners. There are measures in place to support them. About 40 per cent of residents in every facility are fully or partially supported by government supplements. Whether premium or more modest, anyone can access a fully supported bed if it is available. The system is designed to ensure that everyone can access quality care, regardless of their financial situation.
Myth 3: People can reduce their aged care costs by giving their money away
This dangerous misconception stems from “inheritance impatience” – when families think surplus cash from selling a parent’s home can be distributed early.
Giving away money or assets to reduce aged care costs will not work. This is a deprivation of assets and will be assessed for five years, keeping fees relatively high. Centrelink has strict gifting rules. Individuals can gift up to $10,000 per financial year, for three years within a five-year period. Any gifts beyond these limits will still be counted as assets for means testing.
Some people think they can gift their home to an adult child who moves in with them, avoiding the need to sell. This strategy will not succeed. The asset will still be assessed, and the person will face the financial consequences without the benefit.
Rather than trying to manipulate the system, individuals should seek proper financial advice from an adviser who specialises in aged care. The government can’t prop everybody up. A contribution is required for those with assets, and legitimate planning is far more effective than attempting to hide them.
Myth 4: People must sell their home to move into aged care
Individuals can choose whether to sell their home or not. However, it is important to understand that retaining the home may affect the fees paid and pension entitlement.
The situation becomes more complex when considering “protected persons.” If a spouse remains in the family home, that home becomes a protected asset exempt from aged care means testing. The same protection applies if certain other people continue living there, but specific criteria must be met.
For a non-dependent adult child or close family member to qualify as a protected person, they need to have been living in the home for five years or more and receiving an income support payment from the government (such as a carer’s pension, not a carer’s allowance). If a carer has been living in the home for over two years, the home will be assessed at the capped value of $210,555.20.
If no one is living in the home when the person transitions into care, the home will also be assessed at the capped value, or at the net market value if the home is worth less than the capped amount.
These rules are intricate and highly dependent on individual circumstances. It is always best to speak with a financial adviser specialised in aged care to determine whether retaining the home is viable, whether renting it out makes sense, and how these decisions will affect aged care fees and government support payments.
Myth 5: Home care package waitlists will be shorter under the new system
Assessment times have reduced dramatically, from 12 months down to just three or four weeks. However, there are still not enough home care packages available, and the waitlist continues to grow with around 87,000 people currently waiting.
While Canberra recently released an additional 20,000 packages, Australia’s ageing population means people continue joining the waitlist. Being approved and receiving a package are two different things – the blockage is in package allocation, not assessment.
The Commonwealth Home Support Program (CHSP) is also being phased out by 1 July 2027, with all recipients transitioning to the new Support at Home Program. Unfortunately, we’ve heard of many people who have received CHSP approval codes over the last six months but are struggling to find providers. The government is no longer putting out tenders for CHSP providers due to the winding up of the program, and only a few providers currently have capacity (particularly for domestic assistance services).
For those entering or already in the system, understanding options and getting on waitlists early remains crucial.
Bonus myth: People must appoint their children as their Enduring Power of Attorney
While not strictly an aged care myth, this is a critical legal consideration that goes hand-in-hand with aged care planning.
Many people feel obligated to appoint their children as Enduring Power of Attorney (EPOA), and children often reluctantly accept. But when they actually have to look after a parent, this can lead to problematic scenarios. They may think: “We’ll just shove them in a home and forget about them. That way it’s all looked after. We set up the direct debits and don’t have to do anything as the Enduring Power of Attorney.”
But that is not the role. The role of an EPOA is to support the person and fulfil their wishes. If someone has stated they do not want to go into an aged care facility and want their funds exhausted to keep them at home for as long as possible, that is what their attorney should be doing.
An Enduring Power of Attorney should carry out the person’s wishes without their own agenda, acting as a trusted support and advocate. The role carries enormous power and responsibility. Sometimes appointing more than one person can help, as they share the responsibility for decisions made on behalf of the principal. If you suspect that family members will not be able to take on the role without getting involved in family disputes, it may be best to appoint a professional to the role, such as a lawyer or accountant.
Careful consideration should be given to who is appointed, as it is one of the most important decisions a person can make.
Attwood Marshall Lawyers – helping individuals navigate aged care with confidence
Attwood Marshall Lawyers is one of the few law firms with three Accredited Aged Care Professionals ready to provide up-to-date and trusted advice to the elderly and their families when making important decisions about aged care.
Whether families are considering aged care options, navigating aged care agreements, or need to revise estate plans as they transition to care, Attwood Marshall Lawyers is here to help.
To explore options, please get in touch with our Aged Care and Wills and Estates Department Manager, Donna Tolley, on direct line 07 5506 8241, email dtolley@attwoodmarshall.com.au or free call 1800 621 071.
