Looking to become a Helper? Click here

A dependable support community you can trust

Cost Comparison Home Care vs Institutional Care

Home Care Packages

Updated 05-01-2024

Cost Comparison Home Care vs Institutional Care

When families are faced with the challenge of finding suitable care for elderly or disabled loved ones, the decision often boils down to cost. Understanding the financial implications of home care versus institutional care is crucial in making an informed decision that benefits both the care recipient and their family. In this article, we explore the various factors that contribute to the costs of each care setting in Australia.

Understanding Home Care

Home care, or in-home care, refers to supportive care provided in the individual's home by professional caregivers. These services can range from assistance with daily living activities to more comprehensive medical care.

Costs of Home Care

1. Type of Care Required: The level of care needed is the most significant factor influencing cost. Personal care services, such as help with bathing and dressing, are generally less expensive than specialised nursing care.

2. Hours of Care Needed: The number of hours the caregiver is required each week will also determine the overall cost. Live-in or 24-hour care will be more expensive than occasional visitation.

3. Funding and Subsidies: The Australian Government subsidises home care through programs like the Home Care Packages (HCP) program. Eligibility for these subsidies can significantly reduce out-of-pocket expenses.

4. Additional Expenses: Costs for home modifications, medical equipment, and other out-of-home services can add to the total home care expenses.

Comparing with Institutional Care

Institutional care, often referred to as residential care or nursing homes, provides a comprehensive, on-site care service in a specialised facility.

Costs of Institutional Care

1. Accommodation Costs: Residents typically pay a basic daily fee, a means-tested care fee, and an accommodation payment which can be a lump-sum Refundable Accommodation Deposit (RAD) or a Daily Accommodation Payment (DAP).

2. Level of Care: Higher levels of care, such as specialised dementia wards or palliative care services, will incur higher costs.

3. Extras and Lifestyle Expenses: Additional services such as cable TV, private rooms, or excursions can also impact the total cost.

4. Government Assistance: The government also offers subsidies for those in residential care, however, the eligibility criteria and the amount covered can vary from home care subsidies.

Evaluating the Total Cost

To accurately evaluate the total cost of care, families must consider not only the direct expenses but also the indirect costs such as the opportunity cost for family caregivers who may forego employment to provide care.

Considerations for Home Care

  • Flexibility in care delivery
  • The potential need for home modifications
  • The emotional benefits of aging in place

Considerations for Institutional Care

  • On-site medical and emergency care
  • Social interactions with peers
  • The cost and stress associated with moving from home

Making an Informed Decision

Families must weigh the personal preferences of their loved one against the financial realities of each care option. It is also advisable to consult with financial advisors and social workers who specialise in elderly care to understand all the costs involved.

The Financial Impact Over Time

The long-term financial impact of each care option can differ significantly. Typically, home care may be more cost-effective in the early stages of care when less assistance is required, whereas institutional care may become more financially viable as care needs intensify.

Quality vs Cost

While cost is a significant factor, the quality of care should never be compromised. It is essential to ensure that the chosen care option meets the medical, emotional, and social needs of the care recipient.


Choosing between home care and institutional care is a complex decision that must take into account both the financial costs and the individual needs of the care recipient. Whilst home care offers the comfort of familiar surroundings, institutional care provides specialised services that may be necessary as care needs grow. By considering the detailed costs and benefits of each option, families can make a choice that provides their loved ones with the quality of care they deserve, in a financially sustainable manner.

About the Author

Olivia is a seasoned professional with an extensive career spanning the Aged Care sector, bringing decades of experience to her role. Her comprehensive understanding of Aged Care services and practices is a testament to her dedication. Olivia’s gratitude extends to those who have generously shared their knowledge and insights with her over the years, contributing to her wealth of expertise.

Olivia’s articles reflect her commitment to practical and informative content. They skillfully combine her industry know-how with real-world insights, providing valuable resources for navigating the complexities of the Aged Care sector. Olivia stands as a reliable advocate for delivering compassionate and effective care to elderly individuals, offering her support not only to fellow care workers and professionals but also to those seeking to gain a deeper understanding of the sector.

Frequently Asked Questions

Are There Services Not Included in Home Care Packages?

Home Care Packages are a popular and effective means of receiving support for aged care at home in Australia. These packages offer various types of assistance and are designed to help older Austral... read more

How Do I Get a Home Care Package in Australia?

Navigating the complexities of acquiring a Home Care Package in Australia can be challenging. Care and support in the comfort of one’s own home are pivotal for many Australians as they age. I... read more

How Long Does It Typically Take to Receive a Home Care Package?

Understanding the timeline for receiving a Home Care Package is crucial for individuals and families planning aged care services. The process can vary greatly depending on a number of factors, incl... read more

What Are the New Home Care Package Guidelines for 2023?

In recent years, the Australian government has made a series of changes to the Home Care Package (HCP) program to improve the accessibility and quality of in-home support for the elderly. As 2023 u... read more

What Can You Claim on a Home Care Package?

Navigating the complexities of home care packages can be overwhelming for many individuals, especially when determining the types of services that the funds can be applied toward. If you or a loved... read more

What Doesn’t a Home Care Package Cover?

When considering a Home Care Package in Australia, it’s essential to understand that while these packages are designed to provide assistance to older adults living at home, they don’t c... read more

Who is eligible for a Home Care Package in Australia?

Understanding eligibility for a Home Care Package is crucial for Australians seeking support to live independently in their homes despite health challenges or aging. The Home Care Package program i... read more

Why Choose Kinder Caring for Your Home Care Needs?

Contact us today to discover how our personalised care plans can make a significant difference in your life, upholding our commitment to care and compassion.

A dependable support community you can trust

Tradition of Trust & Excellence

At Kinder Caring, we stand as guardians of a 25-year heritage, offering top-notch home care services. Our deep understanding and vast experience make us an ideal choice for those seeking excellence in community care.

A dependable support community you can trust

Tailored Care for Your Lifestyle

We specialise in creating personalised care plans, understanding each client’s unique needs. Our Care Managers ensure every care aspect is bespoke, valuing each individual’s distinct preferences and requirements.

A dependable support community you can trust

Empowering Your Choice

Kinder Caring respects your decision-making freedom. Choose between our in-house experts or skilled independent contractors for care that perfectly fits your lifestyle, providing genuine flexibility.

A dependable support community you can trust

Decades of Service

Over 25 years, Kinder Caring has dedicated over 2.5 million hours to supporting more than 7,400 individuals, reflecting our commitment to impactful, high-quality care.

A dependable support community you can trust

A Community of Professionals

Our team, chosen for skill and compassion, forms the backbone of Kinder Caring. We focus on building a strong, caring team committed to your comfort and well-being.

A dependable support community you can trust

Accreditation & Improvement

Kinder Caring’s adherence to the ACIS and investment in ongoing staff development reflect our commitment to providing care that meets the highest quality and contemporary standards.

A dependable support community you can trust

Building Trusted Relationships

We’re more than care providers; we’re partners in your health journey. With a widespread network and collaborations with funding organisations, we offer accessible, superior care across NSW, QLD & VIC.

A dependable support community you can trust

Join the Kinder Caring Family

Choosing Kinder Caring means joining a family dedicated to your independence and well-being. Be part of our 25-year journey, continuing our legacy of impactful, caring service.

Our happy clients

Bridging the gap between you and an enhanced quality of life, Kinder Caring is committed to nurturing your independence, and delivering compassionate care in the comfort of your home.

A dependable support community you can trust

We’re immensely grateful for Kinder Caring’s assistance over the past months. A special shoutout to Nicole Coupland, who has been an exceptional carer for Mum. Thank you for your unwavering support.

- Carolina,
Willoughby, NSW
A dependable support community you can trust

We are so pleased with the care Dad has been receiving from Kinder Caring, especially from Aster. She has shown professionalism and dedication. We appreciate the company’s flexibility in accommodating our requests, like Aster wearing a mask and gloves. The temporary rail adjustments and the proactive approach in ensuring the best care for Dad is commendable. Thank you, Kinder Caring.

- Karin,
Kealba, VIC
A dependable support community you can trust

Kinder Caring has been exceptional in their service. They provided a wonderful carer who is exceptional at what she does. Not only did they promptly get my quote approved, but they also took care of my window cleaning needs and organized transportation for my medical appointments. I couldn’t be happier!

- Maria,
Melton, VIC
A dependable support community you can trust

There was so much more to caring for Dad than we ever thought. Kinder Caring provided everything we needed to support us; they became part of our family… they made a difficult time so much easier for us.

Lindfield NSW
A dependable support community you can trust

A huge thank you to all the nurses at Kinder Caring. Having your expertise, caring attitude and ongoing advice meant we did not have to place Dad into a nursing home or send him to hospital and therefore his last days spent with Mum and the family were very special for us all.

Mt Waverley Vic

Experience Exceptional Home Care with Kinder Caring!

Unlock 25 Years of Trusted Expertise: 2,500,000+ Hours of Dedicated Care delivered to 7,400+ people from 560,000+ Personalised Services

Your Journey to Peace of Mind Starts Here. Contact Us Today!

1300 796 675