2016 Budget Aged Care Update: Equity Release ‘In the Mix’
Budget cuts are often disdained, and in this case some industry players are worrying that this decision may lead to compromising the quality of healthcare services for Australian seniors. Some believe that this could kill the much needed purchases of new care beds and may push vulnerable residents into ageing at home instead of assisted living facilities.
Budget Cut is Part of the 2016 Aged Care Roadmap
Let’s examine the reasons behind this budget cut. While this decision had generated some headlines, this is very much in line with the Age Care Roadmap launched in March.
The budget cut is just a response of the government to achieve a “sustainable aged care sector financing arrangements where the market determines price, those that can contribute to their care do, and government acts as the safety net and contributes when there is insufficient market response.”
The Aged Care Roadmap supports a greater degree of self-funding and it resolves the need to address the “unsustainable spending” within the aged care system with “better targeting” of funding.
Meanwhile, it also aims to remove the distinction between care at home and residential care, which promotes ageing in place. Spending retirement years at home offers some great social benefits: you remain better connected with your family, friends, and the community. This is invaluable for emotional support and to provide peace of mind during what is often a challenging period for elderly people.
Will This Cut Compromise the Quality of Aged Care?
I believe this cut will not affect the quality of aged care. The government will impose better targeting for aged care funding, which will drive competition. Nursing homes will be encouraged to innovate their services as the roadmap supports better consumer choice.
In addition, the government will also implement the single set of core aged care standards that will ensure a safety net for consumers.
Reverse Mortgage Can Be A Great Solution
It’s important to note that this move encourages us to self-fund our retirement. If you need more assistance to achieve this, then equity release finance such as reverse mortgage should be ‘in the mix’ of options you consider. By using equity within your home (which for most retirees is their biggest asset) it’s possible to live a comfortable retirement with independence, dignity, and peace of mind.
Here at Heartland, many of our customers have unlocked their home equity to pursue ageing in place or to assist with aged care costs. If you own your home, you are actually sitting on idle wealth that you can use to obtain better financing for your retirement. To learn more about reverse mortgages, Heartland has a comprehensive guide that you can download for FREE. You can also call our Reverse Mortgage specialists at 1300 889 338 for a chat.
Information provided is accurate as at 16 May 2016 and may change from time to time