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Monthly home care package statements... We continue our explanation of the sample statement presented in last week's blog.
© Danielle Robertson Consulting Pty Ltd t/as DR Care Solutions
Clients often ask us about the various lines of their in-home care service provider’s monthly home care package (HCP) statement.
Today we examine, line by line, the second half of a sample monthly statement issued by a national in-home care service provider to their Level 4 HCP client. The first half was examined in last week’s blog[1].
To recap, the statement relates to the services provided to the Level 4 HCP client for the month of April 2023. We’re up to the “Funds Out” (Line 4).
Line 4: “Funds Out”:
This is the calculation of the service provider’s fees for care services rendered and related expenses. The monthly statement includes a two-page listing of the care services rendered during the month of April 2023. The final page of this listing for the sample client is shown in the image.
This particular Level 4 HCP client receives two to four hours of daily care seven days a week. For the month of April 2023, a total of 81.75 hours of care were provided. During the month the client received treatment for a skin tear and wound dressings were purchased.
As shown in the extract, the Total Cost of Care Services rendered for April 2023 came to $7,236. Added to that was the External Services Cost of purchasing wound dressings for the client ($5.70) and the service provider’s Care Management Fee ($401.93). This brought the Total Funds Out (or what is due to be paid to the service provider) to $7,643.63.
What is a Care Management Fee?
This is a fee charged by the service provider for managing the HCP. The fee covers the time taken for the service provider to liaise with the client and their family to ensure the care provided meets the client’s needs, goals and preferences[2].
The Australian Government asks service providers to be fair and reasonable in charging this fee, and has set a maximum fee that can be charged for each HCP level. From 1 July 2023, the maximum charge for a Level 4 HCP is $457.10 per fortnight ($914.20 per month).
In the example given, the client is paying $401.93 per month. At the time of April 2023, the maximum care management fee that could be charged for a Level 4 HCP was $408.66[3].
Line 5: “Closing Balance”:
This is the amount owed by the client or, if there are surplus funds held by the service provider, the amount held in credit for the client.
In this example statement, the Level 4 HCP package client owes $5,007.81. This amount comprises the Opening Balance of $1,742.38 that remains unpaid from the previous month (March 2023) and the difference between the “Total Funds Out” and “Total Funds In” for April 2023 which comes to $3,265.45.
Total paid ‘out of pocket’ by the client in April 2023
To summarise, for services rendered and expenses incurred for their Level 4 HCP for April 2023, the client (a self-funded retiree) paid out of their own pocket $4,310.63 in HCP fees.
$4,310.63 is the addition of $3,265.43 (Total Funds Out minus Total Funds In) and $1,045.20 (the Income-Tested Care Fee). In other words, for the 81.75 hours of care that month the client paid ‘out of their pocket’ $52.73 per hour. This compares with around $40.56 per hour paid ‘out of pocket’ in March 2023.
April 2023 was more expensive for the client as they received care on the public holidays - Good Friday, Easter Sunday, Easter Monday and ANZAC Day – and more care visits from the service provider as the family carer (a visiting carer) took a 10-day holiday.
Self-funded retirees and in-home care
Some self-funded retirees are not taking up HCP as they feel the ‘out-of-pocket’ cost (in our sample statement $4,310.63 or $52.73 per hour for April 2023) is too high.
They prefer to hire their own home help either:
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On open market care employment platforms at a lower cost (this comes at a risk as the open market is not regulated), or
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Through the traditional care service providers offering ‘fee for service’ care and support.
Just shop around and ensure there are no hidden or additional costs to what is being charged.
At DR Care Solutions, we present the facts to our self-funded retiree clients and leave them to decide.
Need help caring for a loved one? Please feel free to call me, Danielle Robertson, at any time for an initial discussion on how to set up the right care, support and assistance at the right time and in the right place.
Resources
[1] DR Care Solutions: Case Study: Part 1 - A Monthly Home Care Package Statement Explained
[2] Australian Government Department of Health and Aged Care: Care Management and Care Plans for Home Care Packages
[3] Australian Government Department of Health and Aged Care: Home Care Packages Pricing Update
