Recently my widowed aged mother of 89 years was admitted into a nursing home in Sydney.  She paid a large amount of money for her nursing home accommodation (own room and bathroom) using the proceeds from the sale of her modest villa combined with some of her savings.

She has no assets, or so I thought .... no car, no antiques, no shares - nothing, except for what is left in her bank account which is well within the "threshold" level.  No income either except for the pension. 

So I was taken by surprise to hear yesterday that the RAD or Refundable Amount Deposit for her accommodation in the nursing home is treated as an asset; therefore she will possibly need to pay a "means tested care fee", in addition to the 85% of her pension that is taken towards her "daily care fee" by the nursing home.

I have just read "Your Life Choices" newsletter of today, 13 July 2017, and the section: "Income and Asset Tests".  In that section it clearly states - quote: "There are certain assets which are exempt from assessment, such as your main residence if you're a homeowner, certain pre-paid funeral products and accommodation bonds paid when entering an aged care facility" - unquote.

So having read this, I am quite shocked and confused as to why Centrelink will regard my mother's deposit for entering into the nursing home or aged care facility, as an asset for aged care purposes in assessing her for this "means tested care fee" . 

This is contrary to what I have just read in the e-newsletter.  Also, my mother has used up a considerable amount of her savings to buy this "accommodation" in the nursing home, plus of course the sale proceeds from her home which was in a residential park.  So she seems to be losing both ways - 1) no left over cash from the home sale proceeds which was combined with a significant amount from her savings in order to get her "accommodation" in the nursing home, and 2) now even whatever savings she has left will be further reduced because of this "means tested care fee" because of the "asset" of having paid a deposit for nursing home accommodation.

Have I missed something??? As I look after my mother's affairs, the matter of my mother's nursing home accommodation deposit being treated as an "asset" has come as a complete shock to me.

I wonder if anybody out there could please enlighten and explain this matter to me.  Thanks for any advice that you may have.