RAD and DAP
Accommodation payments can be paid as a lump sum, daily payment or combination.
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Aged care glossary
Aged Care Glossary: Key Terms Explained in Plain English
Confused by RAD, DAP, ACAT, means-tested care fees or supported resident rules? This glossary explains common aged care terms families come across when a parent or partner is moving into care.
Use this as a general guide — then get personalised advice before making financial decisions.
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The terms families usually need to understand first
Some aged care words are just terminology. Others affect cashflow, the family home, Age Pension, aged care fees and estate outcomes.
Means-tested fees
Income and assets may affect care fees, pension outcomes and affordability.
Get adviceThe family home
Home decisions can affect fees, pension, cashflow, tax and family planning.
Discuss optionsAssessments and forms
ACAT, My Aged Care, Centrelink and DVA forms can shape the outcome.
Contact usSearch the glossary
Aged care terms and definitions
Search by term, acronym or topic. For example: RAD, DAP, pension, home, fees, ACAT or Centrelink.
No matching terms found. Try searching for “RAD”, “DAP”, “home”, “fees”, “pension” or “assessment”.
A
ACAT / ACAS Assessment
ACAT stands for Aged Care Assessment Team. In Victoria, it is commonly called ACAS. This assessment helps determine whether a person is approved for government-subsidised aged care services, including residential aged care, respite care and home care.
Accommodation Agreement Accommodation
A written agreement between the resident and the aged care provider that explains accommodation terms, room price, payment options and related obligations. Families should review this carefully before signing.
Accommodation Payment RAD/DAP
The amount paid for a resident’s room in an aged care home. It may be paid as a lump sum RAD, daily DAP, or a combination of both.
Read more about RAD and DAPAdditional Service Fees Fees
Fees charged by an aged care provider for additional services or extras above standard care and accommodation. These may include lifestyle services, enhanced meals, entertainment or other agreed extras.
Age Pension Pension
A government income support payment for eligible older Australians. Moving into aged care, selling or renting the home, paying a RAD, or changing investments can affect Age Pension entitlement.
Aged Care Means Assessment Assessment
An assessment of income and assets used to help determine whether a resident pays a means-tested care fee and whether they may qualify for accommodation support.
Approved Provider Provider
An organisation approved to deliver government-subsidised aged care services, including residential aged care, home care or flexible care.
B
Basic Daily Fee Fees
A daily fee that contributes towards everyday living costs in residential aged care, such as meals, cleaning, laundry and general day-to-day services.
C
Carer Allowance Pension
A supplementary payment that may be available to eligible people who provide daily care and attention to someone with a disability, medical condition or who is frail aged.
Carer Payment Pension
An income support payment that may be available to eligible carers who cannot work in substantial paid employment because of the demands of their caring role.
Care Recipient Care
A person who receives care and support, either in the community, at home, in respite or in a residential aged care home.
Centrelink Pension
The government agency, now part of Services Australia, that administers Age Pension and many aged care income and asset assessments. Centrelink should usually be updated when aged care circumstances change.
D
Daily Accommodation Contribution (DAC) Accommodation
A daily contribution that may be payable by a supported or low-means resident towards accommodation costs, depending on their assessed income and assets.
Daily Accommodation Payment (DAP) RAD/DAP
A daily payment made instead of paying the full room price as a lump sum. It is calculated on the unpaid accommodation amount using the applicable interest rate. DAP is not refundable.
Read more about DAPDVA Pension
The Department of Veterans’ Affairs. DVA may be involved where the resident receives veteran-related payments, benefits or concessions. Moving into care can affect assessments and payments.
E
Enduring Power of Attorney Family decision
A legal document that appoints a person to make financial and/or personal decisions if the person loses capacity. Attorneys often need to make aged care financial decisions on behalf of a parent or partner.
Estate Planning Family decision
Planning for how assets are managed and distributed during life and after death. Aged care decisions, including RAD, home sale and cashflow choices, can affect estate outcomes.
Extra Services Fees
Additional services or amenities offered by some aged care providers for an extra fee. These should be clearly disclosed in the provider’s agreement or fee schedule.
F
Financial Hardship Assistance Fees
Government assistance that may be available where a resident cannot pay aged care costs due to circumstances beyond their control. Eligibility is assessed individually.
H
Family Home Home
The resident’s former home can be one of the most important aged care decisions. Selling, renting or keeping the home may affect cashflow, aged care fees, Age Pension and estate outcomes.
Discuss home optionsHome Care Package Care
A government-subsidised package of care and services designed to help eligible people remain living at home. It is different from residential aged care.
M
Means-Tested Care Fee Fees
An additional contribution towards care costs based on a resident’s assessed income and assets. Not everyone pays this fee, and the amount can change if income, assets or home ownership arrangements change.
MPIR RAD/DAP
MPIR stands for Maximum Permissible Interest Rate. It is used to calculate the daily accommodation payment on any unpaid accommodation amount.
My Aged Care Assessment
The Australian Government’s main entry point for aged care information, assessments and referrals. Families often start here before accessing residential aged care, respite or home care services.
P
Part RAD / Part DAP RAD/DAP
A combination strategy where part of the room price is paid as a lump sum RAD and the balance is paid as a DAP. This can reduce daily payments while keeping some cash available.
Permanent Residential Aged Care Care
Ongoing care and accommodation in an aged care home for a person who can no longer be safely supported at home or needs a higher level of care.
Power of Attorney Family decision
A legal document that allows another person to act on someone’s behalf. In aged care, attorneys often help make financial decisions, complete forms and manage accommodation payments.
Protected Person Home
A person who may cause the former home to be treated differently for aged care assessment purposes. This can include a spouse, dependent child, qualifying carer or qualifying close relative, depending on the rules.
R
Refundable Accommodation Contribution (RAC) Accommodation
A lump sum accommodation contribution that may be payable by a supported or low-means resident, depending on their assessed income and assets.
Refundable Accommodation Deposit (RAD) RAD/DAP
A lump sum paid to an aged care provider for accommodation. A RAD can reduce or remove DAP, but it ties up capital. It is generally refundable when the resident leaves care, less permitted deductions, unpaid fees and any applicable retention.
Read more about RADRent Assistance Pension
A Centrelink payment that may help eligible people with rent. Whether rent assistance applies in aged care depends on the resident’s circumstances and payment arrangements.
Residential Aged Care Care
Care and accommodation provided in an aged care home for people who need ongoing support, personal care, nursing care or supervision.
Respite Care Care
Short-term care designed to give carers a break or support someone after illness, hospitalisation or during a transition period. Respite can occur at home, in the community or in an aged care home.
RAD / RAC Retention RAD/DAP
A deduction that may apply to some refundable accommodation deposits or contributions under newer aged care funding rules. Families should check the rules that apply to the resident before assuming the full lump sum will be returned.
S
Services Australia Assessment
The government agency that delivers Centrelink and many aged care-related payments and assessments. Families may need to update Services Australia when aged care circumstances change.
Self-Funded Retiree Pension
A retiree who does not receive Age Pension because their income or assets exceed the relevant thresholds. Self-funded retirees may still need to complete aged care assessment forms.
Supported Resident Fees
A resident who receives government support towards accommodation costs because their assessed income and assets are below relevant thresholds. The resident may pay an accommodation contribution rather than the full accommodation price.
Understanding the terms is only the first step
If your family needs to decide whether to pay RAD, DAP, sell the home, rent the home, complete Centrelink forms or compare cashflow outcomes, book a free introductory call.
Glossary FAQs
Common questions about aged care terms
What are the most important aged care terms to understand first?
For most families, the key terms are RAD, DAP, basic daily fee, means-tested care fee, aged care means assessment, ACAT/ACAS, supported resident, and how the family home is assessed.
What is the difference between RAD and DAP?
A RAD is a lump sum accommodation payment. A DAP is a daily accommodation payment calculated on the unpaid accommodation amount. Many families also use a part RAD / part DAP strategy.
Does knowing the definition tell us what to do?
No. Definitions explain the rules and language, but the best strategy depends on income, assets, the home, pension position, accommodation price, care fees, tax, estate planning and family priorities.
Can you help explain aged care forms?
Yes. We can help families understand what information is needed for aged care means assessments, Centrelink/DVA updates and cost of care forms as part of the advice process.
Need help applying these aged care terms to your family?
Book a free introductory call to discuss where you are in the aged care process, what decisions are urgent and whether personalised aged care financial advice is appropriate.
General information warning: This glossary provides general information only and does not take into account your objectives, financial situation or needs. Aged care rules, fees and rates can change. You should seek personalised advice before making financial decisions.