Our ageing population
These reforms were part of a response to a growing, elderly, Australian population. According to ageing research done by the Arc Centre of Excellence in Population Ageing Research (CEPAR), “Australians aged 85 plus are projected to increase from two per cent of the population to anywhere between three and nine per cent by 2050”.
Plus, as we live longer, there’s a higher chance we may suffer illness in our old age. “Currently one fifth of people aged 65 and over say they need care and lifetime risk estimates suggest that half of men and two thirds of women aged 65 will need formal aged care in their remaining lifetime,” says the CEPAR report.
The cost to care for someone in a residential facility can be as high as $79,683 per year2and these costs are heavily subsidised by the Government, which spends over $15 billion a year on aged care. A rapidly expanding elderly population ultimately means an increasingly expensive financial burden on the government. The aged care reforms are a way of mitigating some of these ballooning costs.
Key areas of reform
– The changes and impacts of the reforms are complex but can be summarised as follows:
So, what does this mean for you and your family? Before they get less independent, it’s essential to find out what older loved ones want to happen and how much will that cost.
Choices around aged care can also mean selling houses and changing retirement income structures and a whole range of other financial considerations.
Source: BT Financial