Most families meet these words for the first time in a stressful week. Here is what care really costs, who pays, and the three things worth knowing before anything else.
A free assessment decides whether resthome, hospital or dementia care is needed. Your GP can arrange the referral.
A location-based maximum applies to contracted care. Premium room charges and other agreed extras sit outside this cap.
Eligibility depends on your assessed needs, age and financial circumstances. Any Residential Care Subsidy is paid directly to your care provider.
Follow these steps in sequence. The care assessment comes before the financial assessment.
Ask your GP for a referral to your local Needs Assessment and Service Coordination team (NASC), or contact them directly. They assess what level of care is needed: resthome, hospital or dementia care. The assessment is free and is needed before applying for residential care funding.
Visit homes that can provide your assessed level of care. Ask the team to explain the care fee, any additional room charge and other services before you agree to a room. Your admission agreement records the charges.
Your needs assessor can provide the Residential Care Subsidy application for a financial means assessment. Return the form and supporting documents to Work and Income promptly. If you are 65 or older, return them within 90 days of the date you want the subsidy to start. Eligibility and the start date depend on your circumstances.
Work and Income assesses the applicable assets and income and tells you, Health New Zealand and your care home the outcome. If you qualify, Health New Zealand pays the subsidy directly to the home. Work and Income confirms the contribution you must make from your income.
Ask your community team how the approved funding and your contribution will appear on your account. Check any separately agreed charges, the payment arrangements and who to contact with questions. Tell Work and Income if your financial circumstances change.
Your funding outcome determines how contracted care is paid for. Room charges and other agreed extras are considered separately.
Work and Income works out your contribution from its income assessment. Health New Zealand pays the subsidy directly to your care home to cover the difference between that contribution and the funded cost of care.
Most of your NZ Super or benefit goes towards care. You retain a personal allowance and receive an annual clothing allowance. Other assessable income may also contribute, so the amount varies between people.
For eligible residents receiving contracted care, your care contribution is capped at the government-set maximum for the home’s location. The maximum contribution amount is reviewed annually and may be adjusted in July each year.
If your assessed needs require a higher level of care, such as hospital or dementia care, Health New Zealand pays the additional contracted care cost directly to the provider. This also applies to eligible private-paying residents.
For illustration only, imagine a weekly funded care cost of $1,600 and an assessed resident contribution of $500.
The $500 contribution and $1,100 subsidy together cover the $1,600 care cost. Any agreed premium room charge or other extra is additional.
These figures are illustrative, not Promisia prices or an eligibility estimate. Work and Income confirms your contribution and funding outcome.
Compare accommodation charges alongside assessed care needs. Ask for the terms and full costs of the specific room or suite.
A standard room forms part of contracted residential care. Ask the community team about current room availability and what the admission agreement includes.
Some rooms have an agreed additional accommodation charge, paid privately even if you receive a care subsidy. An ensuite, garden access or a good view does not automatically mean an extra charge at Promisia. Ask about the specific room.
An ORA gives you the right to occupy accommodation under its terms. Ask the community for the entry payment, ongoing fees, care charges and exit deductions for the specific suite. Do not assume these match standard-room funding.
For contracted residential care, the following are examples from government guidance. Your admission agreement explains the services and charges for your chosen home.
Extra charges must be specified in the admission agreement. Ask for a written breakdown before deciding.
Read the government guide to included servicesGet a clear picture of the costs for your chosen room.
Content checked on 24 September 2026.
This guide is general information, not financial or legal advice. Rates and eligibility rules can change. Confirm your circumstances with Work and Income and obtain independent legal advice before signing an ORA.
If you do not qualify for a subsidy because of the value of your home, you may be able to apply for a Residential Care Loan. Work and Income assesses each application individually.
It is an interest-free loan secured against your home and paid directly to your care provider. You still make an assessed contribution towards care.
Unlike a subsidy, the loan must be repaid. Repayment is generally due when the home is sold or within 12 months of your death, whichever happens first. Late repayment can attract interest.
Ask Work and Income to check subsidy eligibility first, then whether you meet the loan criteria. Your needs assessor can help you obtain the application form.
There are legal documents and possible application costs. Discuss the agreement with your solicitor before signing.
Residential Care Loan eligibility and applicationsClear answers to the questions families most often ask before making a decision.
Ask the community team about room availability, care fees and accommodation agreements. Work and Income can confirm subsidy eligibility for your circumstances.
