The Aged Care Act 2024 updates a number of the funding mechanisms for aged care services, with the intention of increasing fairness for residents, strengthening consumer protections, and making aged care more sustainable for both the Government and Providers. The information below summarises these updates and explains how Inerva Cloud ERP and Resident Select supports you to comply with them.

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Inerva Cloud ERP

‍Update 4th August 2025

The reforms are being implemented in phases. This Invera Cloud ERP software release (version 42.2025.7.1), dated 4th August and rolled out progressively over ten days, introduces Phase 1 of functionality aligned with the Aged Care Act 2024. Features such as RAD Retentions, DAP Indexation, and Caps Tracking will only activate for clients whose ‘First Entered Permanent Residential Aged Care’ date is on or after 1 November 2025. You will notice progressive updates for each item below leading up to 1st of November.

The new contributions will be managed in the Funding Template via the Funding Type. Two new funding types, Aged Care Act 2024 and Aged Care Act (grandfathered), have been added and are available for future configuration.

We recommend familiarising yourself with the new tools using your test environment and test clients set to enter care post-1 November 2025.

For more help, reach out to the Support team.

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‍Hotelling Supplement Contribution

• What’s Happening: While the Hotelling Supplement continues, some residents will be required to pay a contribution, based on their means. The new Hotelling Supplement will be natively built into the existing Funding Template tool to drive automated billing, just like your other fees and subsidies.

4th August Update: You can now map your account defaults at the Location level. Under Fee Accounts, you will find a new account mapping for the Hotelling Supplement Contribution.

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Non-Clinical Care Contribution

• What’s Happening: Replaces the Means Tested Care Fee. The determination of funding for care is being split between clinical and non-clinical. Government will fund all clinical care costs. Government may also fund some or all non-clinical care costs, but some residents will be required to contribute to their non-clinical care, based on their means test. Contributions will be capped to 4 years or $130,000, whichever is reached sooner.
• The new Non-Clinical Care contributions will be built into the Funding Template tool for automated billing. Inerva Cloud ERP’s cap tool will also be updated to manage the new Non-Clinical Care contribution fiscal and durational cap.

4th August Update:  A dedicated account for Non-Clinical Care Contribution can now be mapped under Fee Accounts. Caps tracking functionality has also been introduced and enhanced for stability.

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RAD/RAC Retentions

• What’s Happening: Providers must retain up to 2% of a resident’s deposit annually for 5 years.
• Automatic management of retentions on clients with RADs/RACs, calculating their daily retention rate based on the deposit balance each day, and accurately retaining the correct amount each cycle.

4th August Update: New account mappings for RAD Retentions and RAC Retentions are now available under Bond Defaults. During billing runs, a new option allows you to include RAD/RAC retentions. These will only apply to clients with a ‘First Entered Permanent Residential Aged Care’ date on or after 1 November 2025, ensuring no impact to current clients.

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‍Indexation of DAPs

• What’s Happening: Rate no longer fixed on entry, but indexed twice per year.
• The indexation of DAPs will be managed automatically and driven from the centralised recording of the indexation factors.

4th August Update: DAP Indexation is now fully automated and will activate for clients who enter permanent residential aged care on or after 1 November 2025.

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HELF replaces Additional and Extra Service Fees

• What’s Happening: Providers can continue to sell services that are not covered by the Act, but the rules governing how those services are sold and managed are changing.
• HELF fees can be billed through the system with full transparency on the client invoice.

HELF will be updated in later releases in time for 1st November 2025.

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Resident Select

‍Hotelling Supplement Contribution

• What’s Happening: While the Hotelling Supplement continues, some residents will be required to pay a contribution, based on their means.
• Updated means testing calculators allow for quotes to automatically present the likely contributions a resident will need to pay based on their circumstances, allowing for confident, informed discussions with prospective residents.

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Non-Clinical Care Contribution

• What’s Happening: Replaces the Means Tested Care Fee. The determination of funding for care is being split between clinical and non-clinical. Government will fund all clinical care costs. Government may also fund some or all non-clinical care costs, but some residents will be required to contribute to their non-clinical care, based on their means test. Contributions will be capped to 4 years or $130,000, whichever is reached sooner.
• Like the Hotelling Supplement Contribution, we have updated our means testing calculators to allow for quotes to automatically present the likely contributions a resident will need to pay based on their circumstances, allowing for confident, informed discussions with prospective residents.

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RAD/RAC Retentions

• What’s Happening: Providers must retain up to 2% of a resident’s deposit annually for 5 years.
• Resident Select’s quotes will provide a retention guide based on their potential deposit options, allowing prospective residents to understand what retentions mean for them.

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‍Indexation of DAPs

• What’s Happening: Rate no longer fixed on entry, but indexed twice per year.
• Quotes and agreements will be updated with the relevant wording that explains the indexation of DAPs.

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HELF replaces Additional and Extra Service Fees

• What’s Happening: Providers can continue to sell services that are not covered by the Act, but the rules governing how those services are sold and managed are changing.
• Resident Select will contain a new HELF management tool for service and bundle configurations, and a HELF quote and agreement workflow to manage the sales opportunities

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