When the Aged Care Act 2024 (Cth) arrived just before Christmas, some may have thought the Higher Everyday Living Fee (HELF) was a new kind of elf — or perhaps a viral holiday trend. But no, dear reader, the HELF is here to replace the Extra Service Fee and Additional Service Fee, introducing a more structured, consumer-focused approach to optional services in residential aged care.
Now, with the release of the consultation draft of the new Aged Care Act rules, the finer detail of the HELF framework is available for consideration.
A Gift from the Government?
Like all regulatory changes, the HELF presents both opportunities and challenges for providers.
Opportunities:
- Providers now have a much clearer legal framework for offering services over and above the funded aged care offering. After the uncertainty wrought by Regis Aged Care Pty Ltd v Secretary, Department of Health [2018] FCA 177, this should significantly increase confidence in structuring service offerings.
Challenges:
- Transitioning to HELF is going to require careful planning to reduce churn and even grow this revenue stream.
- Protections granted to individuals allow them to unilaterally terminate, prevent exit fees being charged and create challenges for bundling services. This means that safeguards providers have traditionally used to preserve demand and cost efficiencies can no longer be used or will not be as effective.
What is the Higher Everyday Living Fee?
To validly charge a HELF, providers must meet several key conditions:
- Written agreements are required, with price increases capped at CPI. They must also be expressed in plain language and “be readily understandable by the individual”.
- Agreements cannot be offered until after a resident moves in, and providers cannot charge for services before an agreement is in place.
- Mandatory disclosure requirements apply—residents must receive a fact sheet and a full fee breakdown before entering care.
- Goods and services must be demonstrably different or better than those required to be provided under the Aged Care Act.
Certain residents cannot be charged HELF, including those receiving specific government supplements (e.g., pensioner or respite supplements).
What Services Can and Can’t Be Included?
A draft Service List has been released, closely resembling the existing Quality of Care Principles 2014 (Cth). Providers will need to carefully assess what services qualify for HELF.
We note that, notwithstanding the above-mentioned resemblance there is a range of services traditionally charged as additional/extra services which are now more difficult to charge for (eg. social activities and outings, internet access and individualised room heating and cooling).
The Road to Transition: Key Deadlines
- From 30 June 2025, providers can only enter into HELF agreements — no new extra service/additional service fee agreements can be made. Existing agreements cannot be modified after this date.
- By 30 June 2026, all existing extra service/additional service agreements must be transitioned to HELF, or they will be automatically terminated.
What Should Providers Be Thinking About?
Providers must act now to ensure a smooth transition:
- Design HELF Offer addressing issues such as service design, administrative complexity and compliance monitoring.
- Review existing additional service/extra service programs now to consider how:
- how and the extent to which they can be transitioned to HELF;
- how they will maintain compliance and how/if these changes will impact their revenue.
- Consider how existing pricing strategies will transition to HELF and how they will maintain a return given only CPI adjustments are permitted.
- Develop separate HELF agreements ensuring that:
- they are “readily understandable”;
- they are signed by an appropriate substitute decision maker if the individual does not have capacity;
- they provide for an annual review of the HELF services to ensure that individual is still able to benefit from each service.
- Plan the transition carefully to ensure that individuals with existing agreements successfully transition to HELF by 1 July 2026:
- this will require direct consultation with each individual to confirm they (still) want the services and can make use of them;
- develop and implement a communications and consultation plan which clearly articulates the benefits of the HELF program and makes the transition by individuals to the program as transparent and frictionless as possible.
- Review sales/entry processes to ensure individuals receive the appropriate information and agreements at the correct time.
Moving forward, providers should:
- Ensure that ‘bundles’ of services retain flexibility to ensure that individuals can and do benefit from all of the services in the bundle.
- Consider how consent will be confirmed and documented, especially in instances of declining capacity.
For a conversation about your existing additional services/extra services packages or how to take advantage of these changes contact Amber Crosthwaite at 9288 6931 or amber.crosthwaite@lavan.com.au.
Disclaimer – the information contained in this publication does not constitute legal advice and should not be relied upon as such. You should seek legal advice in relation to any particular matter you may have before relying or acting on this information. The Lavan team are here to assist.
