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If you have been needs assessed as requiring long term care in a rest home or hospital, you may be concerned about funding this care. There are essentially three options; apply for help with payment through the Residential Care Subsidy or loans scheme, or pay fees privately.

Fees for all levels of care are capped at the maximum contribution rate for both subsidised and privately paying residents, unless you agree to pay premium room fees. Payment of maximum contribution covers contracted care services which are detailed in the contract between the care provider and local District Health Board.

To qualify for the Residential Care Subsidy you must have a needs assessment recommending long-term care and meet financial eligibility criteria. You are means tested to see how much you can contribute toward the cost of care and the subsidy makes up the difference.

Contracted care services & maximum contribution

Contracted care services are those provided to needs assessed people in a rest home or hospital with a District Health Board contract. The Maximum Contribution fee covers these services. 

Private payers

These are people who do not meet the asset threshold for Residential Care Subsidy. They pay their own fees which are limited to the maximum contribution for contracted care services. This applies to all levels of care; rest home, hospital and dementia. Private payers continue to receive NZ Super. 

If you do not financially qualify for a Residential Care Subsidy because you own a property and have limited cash or other assets, you may apply for a Residential Care Loan to assist with the cost of your care.

Premium room fees

Premium room fees are common in residential care. There is no public funding available for premium room fees or additional services. This means that even if you are on Residential Care Subsidy, you may still be required to pay premium room fees. It is therefore important to be very clear about any extra costs prior to entering care.

Residential care subsidy 

Information on the Residential Care Subsidy, including eligibility and how to apply.

Income and asset testing

Fine detail on what is counted as income and assets, allowable gifting.


Terms you need to know and what they mean.