Independent valuations of Australian aged care and community care businesses

The regulatory model since 1 November 2025

The Aged Care Act 2024 (No. 104, 2024) commenced on 1 November 2025. Every provider of Commonwealth funded aged care now holds one registration with the Aged Care Quality and Safety Commission (the Commission) in one or more of six categories: home and community services; assistive technology and home modifications; advisory and support services; personal and care support in the home or community; nursing and transition care; and residential care. All providers must comply with the Code of Conduct and act compatibly with the Statement of Rights, categories 4 to 6 must meet the strengthened Aged Care Quality Standards, and the Commission can attach conditions to a registration, including on location or numbers served. The Commission publishes each provider's categories, service types and registration period.

Registration attaches to the legal entity, so deal structure changes the answer. A share or unit sale continues the registered entity; an asset buyer must already hold, or apply to vary, its own registration. Either way the transaction is a notifiable significant change in the provider's organisation arrangements. Categories 5 and 6 must also keep a governing body with a majority of independent non-executive members and at least one member with clinical care experience, unless they serve fewer than 40 older people and that body has fewer than five members, and must maintain a quality care advisory body that reports to the governing body at least every six months. Under the Serious Incident Response Scheme eight types of reportable incident must be notified to the Commission, Priority 1 within 24 hours and Priority 2 within 30 days. Sole traders and partnerships can now register, widening the field of buyers for a small community care business.

Support at Home and community care revenue

Support at Home replaced the Home Care Packages Program and the Short-Term Restorative Care program on 1 November 2025. Each ongoing participant sits in one of eight funding classifications with a quarterly budget: at 1 July 2026 the annual amounts run from $11,010.01 at classification 1 to $80,137.12 at classification 8, indexed each July. Ten per cent of every budget funds care management, replacing the fees providers once set themselves. Unspent budget carries over up to the greater of $1,000 or 10 per cent, and interim funding is 60 per cent of the classification.

Participants make no contribution for clinical supports such as nursing, moderate contributions for independence services and the highest for everyday living services, at rates set by a Services Australia income and assets assessment and subject to a lifetime cap the Department puts at $135,318.69 at 1 November 2025, indexed on 20 March and 20 September and shared with residential non-clinical care contributions. From 1 October 2026 the Government fully funds personal care. Providers still set their own prices, which the Department requires to be reasonable, meaning based on the cost of delivering that service, and published on My Aged Care as the most frequently charged price. Administration and travel cannot be billed separately or drawn from the care management account, so the business is the margin between the published price and the cost of the hour. Growth is rationed: the Support at Home Priority System releases ongoing funding by date of approval and priority category, urgent, high, medium or standard, and a participant who does not start services within 56 days of an allocation loses it.

CHSP is grant funded, unspent grant funds cannot be rolled into a new agreement, and an organisation must win a grant opportunity before it can register for those services. Its clients must be registered with My Aged Care and assessed, so an unassessed client book is a risk rather than an asset. Grant funding runs to 30 June 2027, is being extended to 30 June 2029, and the Department states that CHSP will transition to Support at Home no earlier than 1 July 2027. See government funding exposure.

Residential care: AN-ACC, care minutes and accommodation

Care is funded through the Australian National Aged Care Classification (AN-ACC). National Weighted Activity Units, reflecting each resident's assessed needs and each home's characteristics including Modified Monash location and specialised status, are applied to the AN-ACC price, which the Government updates on 1 October each year on advice from the Independent Health and Aged Care Pricing Authority. That price covers the Residential Care Service List, care minutes obligations, outbreak management and Fair Work Commission award wage increases. The Department states that of the 1 October 2025 AN-ACC price, $6.25 is attributable to the Stage 3 award wage increases for aged care workers, $1.88 to the aged care nurses increases from that date and $0.33 to the aged care nurses increase from 1 August 2026, so a home whose roster costs more than that carries the difference.

The care minutes requirement rests on a sector-wide average of 215 minutes of care per resident per day, including 44 minutes of direct registered nurse care, converted into a target for each home by the method in section 176-20 of the Aged Care Rules 2025, alongside the 24/7 registered nurse responsibility for which a separate supplement is paid. Performance is drawn from the care hours reported in the Quarterly Financial Report and published for every home each quarter. From 1 April 2026 part of the care funding of non-specialised metropolitan homes is paid through a care minutes supplement tied to the minutes delivered, and an externally audited Care Minutes Performance Statement is required from the 2025-26 Aged Care Financial Report.

Resident charges are the third layer, and three sets of fee and accommodation arrangements run side by side: pre-1 July 2014, 1 July 2014 and 1 November 2025. What a home can charge depends on which cohort each resident sits in, and the mix shifts as residents turn over. A resident not eligible for full government support pays the agreed room price as a refundable accommodation deposit (RAD), as a daily accommodation payment (DAP) derived from that price and the maximum permissible interest rate, or as both. A resident with low means status pays an accommodation contribution, and the Government pays an accommodation supplement whose maximum rate turns on whether the home is newly built or significantly refurbished, and is cut by 25 per cent for every day of a calendar month in which, excluding respite and extra service places, fewer than 40 per cent of residents are supported.

Deposits are liabilities, not earnings: the balance is refunded when a resident permanently leaves care, although retention deducted on the 1 November 2025 arrangements is not refunded and is income. Retention also reduces the maximum deposit the provider may hold, the resident cannot be asked to make it up, and under the Act providers report deposit balances monthly with their subsidy claim. Working capital, the cash tied up in receivables and payables, behaves unusually because subsidies are claimed after delivery, so payroll runs ahead of receipts. See premises and lease terms.

Workforce, goodwill and the earnings conclusion

Labour is the largest cost, and awards rather than the owner set most of it. The test is whether the AN-ACC funding attributable to award increases covered this business's wage bill, how much of the roster is agency labour, and whether contractor arrangements would be treated as employment for award, superannuation or payroll tax purposes. See the clinical workforce and business value.

Goodwill is what a buyer pays beyond the identifiable assets net of liabilities. Personal goodwill attaches to an individual and usually leaves with them; transferable, or commercial, goodwill attaches to the business and can be sold. In home care it is a retained participant base: funding follows the participant, unspent Home Care Package balances transfer with them, and a book spread across many care managers transfers better than one built around a single coordinator. In residential care it is occupancy at a registered, staffed location, more transferable but inseparable from the building. Key-person risk is highest where the owner is the facility manager or the only rostered nurse. Disability supports are assessed separately: see NDIS valuations.

HPNA then assesses future maintainable earnings, the normalised result the business could reasonably repeat, expressed as EBITDA (earnings before interest, tax, depreciation and amortisation) or EBIT (before interest and tax). Those earnings are multiplied by a capitalisation multiple, in substance the inverse of the return a buyer requires, reasoned from the risks above rather than borrowed from a rule of thumb. A price paid in one deal is evidence of value, not value itself. See what is maintainable earnings.