Approval of Extra Service Fees

Page last updated: 17 August 2017

Extra Services involves the provision of a significantly higher than average standard of services including accommodation, the range and quality of food and non-care services such as recreational and personal interest activities.

New arrangements for the approval of Extra Service fees commence from 1 July 2014. Under Section 35-1 of the Aged Care Act 1997, aged care providers must apply to the Aged Care Pricing Commissioner for approval of proposed Extra Service fees, including proposed increases to current Extra Service fees. The Secretary of the Department of Health will be responsible for the decision to grant or not to grant or to vary Extra Service status in respect of a residential care service, or a distinct part of a service, as well as any variations thereto.

Extra Service fee increases


Providers who have received approval for Extra Services may apply to the Aged Care Pricing Commissioner for approval of an Extra Service fee or an increase to the fee.

Forms


The application form for approval of Extra Service fee increases is available below.
Application Form: Application for Increases to Extra Service fees (PDF 362 KB)

The Assessor Manual, which guides assessors in making a recommendation to the Commissioner to approve or to refuse to approve an application is also available below:
Assessor Manual: Applications to the Aged Care pricing Commissioner for increases to Extra Service fees (Word 62 KB)
Assessor Manual: Applications to the Aged Care pricing Commissioner for increases to Extra Service fees (PDF 306 KB)

Requirements – timeframes


Approval of an application to increase an Extra Service fee will only be granted where the Aged Care Pricing Commissioner is satisfied that the requirements of Division 35 of the Act and the Extra Service Principles 2014 are satisfied.

This application must be made at least 60 days before the day when the applicant proposes that the fees will take effect. While this application can be made at any time, the Aged Care Pricing Commissioner cannot make a decision on the application until a period of 12 months has elapsed since the date on which the last approval took effect – that is, the date on which the applicant advised that the fees would be effective from.

The Extra Service Principles 2014 also provide that the Extra Service fee paid by the resident cannot be increased unless the resident is notified in writing of the proposed increase at least 30 days before the proposed increase is to take effect, subject to the approval of the Aged Care Pricing Commissioner.

Requirements – amount of increase


Changes in the level of fees payable can only be approved if at least 12 months have elapsed since the last fee approval took effect (i.e. the date on which the provider advised that the Extra Service fees would be effective from), and any fee increase is no more than 20% plus the amount by which the fee would change if it were indexed in accordance with the percentage change in the All Groups Consumer Price Index number (that is, the weighted average of the 8 capital cities) published by the Australian Bureau of Statistics for the 12 months immediately before the application to increase the current fee was made.

For example, if the current fee is $40, and the CPI percentage increase is 3.1%, the maximum allowable increase is 23.1% (i.e. 20% + 3.1%) of $40 which equals $9.24. Accordingly, the maximum the new fee could be is $49.24.

For places in the same service or distinct part of a service the following also applies:
  • the Extra Service fee cannot be nil for a place,
  • the average of the Extra Service fees for all the places in the service or distinct part must be at least $10 per day.

Other requirements


In relation to a proposed Extra Service fee (including Extra Service fee increases), the Aged Care Pricing Commissioner must be satisfied that the extra services have not been included in any other fees or amounts charged to the recipient. In this respect, the Aged Care Pricing Commissioner must have regard to the following: the amount of the proposed fee; the food and services that will be provided for the proposed fee (for example, food options, entertainment options, enhanced personal services, specific products and organised outings); and any benefits relating to accommodation that will be provided for the proposed fee. The Aged Care Pricing Commissioner may also consider any other relevant matter.

For this reason applicants are required, where relevant, to:
  • identify all rooms included in the application for approval of Extra Service fees for which an approval to charge an accommodation payment above the maximum amount determined by the Minister has been given by the Aged Care Pricing Commissioner, and
  • identify any other fees or amounts payable by a resident who has entered into an Extra Service agreement relevant to this application, and the food, services or other benefits related to accommodation that are provided in respect of these additional fees or amounts.

In making applications for approval of Extra Service fees including Extra Service fee increases, applicants are required to include their most recent approved list of benchmarks (incorporated as ‘Schedule 2’ to the Notice of Grant of Extra Service Status or any subsequent variations) relevant to the application for approval of an Extra Service fee, or a copy of their standard Extra Service Status Resident Service Agreement relevant to that application.

The Aged Care Pricing Commissioner will ordinarily notify the applicant in writing of the decision within 28 days of receiving the application for a proposed Extra Service fee increase (unless the Commissioner is unable to make a decision because statutory timeframes prevent her from doing so).

Frequently asked questions


Answers to frequently asked questions in respect of Extra Service fees (including further explanation of required timeframes, Extra Service fees as compared to Extra Service amounts, and the level of Extra Service fees payable by continuing care recipients, as opposed to new residents after 1 July) are published on the Frequently Asked Questions page on this website.