Support at Home Pricing Strategy: How to Set Prices That Protect Your Margin Under the New Model

Why Support at Home Pricing Is the Most Consequential Financial Decision Your Organisation Will Make in 2026

The transition from Home Care Packages to Support at Home is not a rebrand. It is a fundamental restructuring of how home care funding flows in Australia — and the pricing decisions your organisation makes in the first 12 months of the new model will determine your financial position for years to come.

Most aged care providers are approaching Support at Home pricing the same way they approached Home Care Package pricing: by looking at what competitors charge, adding a margin, and hoping the numbers work. That approach was marginal under HCP. Under Support at Home, it is a path to financial distress.

The new model introduces genuine pricing flexibility — but that flexibility comes with genuine pricing risk. Providers who set prices too low will erode margin as costs escalate. Providers who set prices too high will lose participants to competitors. Providers who fail to model the interaction between pricing, volume, and workforce costs will be surprised by both.

Steven Taylor, MBA CPA FMVA, has worked with aged care providers across Australia for over 18 years, managing financial transitions through multiple funding model changes. This guide draws on that experience to give you a practical pricing framework for Support at Home — one that protects your margin while remaining competitive in your local market.

Understanding the Support at Home Funding Structure

Before you can set prices, you need to understand how funding flows under the new model. The Support at Home structure differs from HCP in three critical ways that affect pricing strategy.

How Funding Flows Under Support at Home

Under Support at Home, the Australian Government allocates a budget to each participant based on their assessed needs. That budget is held by the participant — not by the provider. Participants use their budget to purchase services from registered providers at prices set by those providers, subject to the government's price caps.

This is a fundamentally different funding flow from HCP, where the package funding was held by the provider and used to pay for services. Under Support at Home, your revenue depends on participants choosing your services at your prices — which means pricing is now a competitive and commercial decision, not just a cost-recovery calculation.

The Key Difference From Home Care Packages

Under HCP, providers charged a package management fee (typically 15 to 35 per cent of the package value) plus service fees. The package management fee was a significant revenue stream that covered administrative overhead and generated margin.

Under Support at Home, the care management fee structure is different. Providers can charge for care management, but the fee must be justified by the services delivered. The days of charging a flat percentage of the package value regardless of care management activity are over.

This change has significant implications for providers whose margin was heavily dependent on package management fees. If your financial model relied on 20 to 30 per cent package management fees, you need to rebuild your pricing model from the ground up — not adjust your existing model at the margins.

What the New Pricing Flexibility Means for Your Margin

Support at Home gives providers more flexibility to set service prices than HCP did. You can set different prices for different service types, different staff classifications, and different delivery contexts (in-home versus centre-based, for example).

This flexibility is an opportunity — but only if you use it strategically. Providers who set a single price for all services, or who price based on what they think participants will accept rather than what their cost structure requires, will find that flexibility working against them.

The Five Pricing Mistakes Aged Care Providers Are Making Right Now

In working with aged care providers through the Support at Home transition, Steven Taylor has identified five pricing mistakes that are already affecting provider margins. If your organisation is making any of these mistakes, the time to correct them is now — before they compound.

Mistake 1: Copying HCP Pricing Without Modelling Costs

The most common mistake is taking your existing HCP service prices and applying them to Support at Home without modelling whether those prices cover your actual costs under the new structure. HCP pricing was developed in a different funding environment, with different overhead recovery mechanisms. Under Support at Home, those mechanisms no longer exist in the same form.

Before setting any Support at Home prices, build a cost model for each service type that includes: direct labour costs (including on-costs, leave loading, and superannuation), indirect labour costs (supervision, training, recruitment), vehicle and travel costs, administrative overhead allocation, and a target margin. If your proposed price does not cover all of these costs plus your target margin, you are pricing below cost — and no volume of participants will fix that.

Mistake 2: Ignoring the Impact of Participant Choice on Volume

Under Support at Home, participants can change providers more easily than under HCP. If your prices are significantly above competitors in your local market, you will lose participants — and the fixed costs of your service delivery infrastructure will not reduce proportionally.

Your pricing model needs to include a volume sensitivity analysis. What happens to your margin if you lose 10 per cent of participants? 20 per cent? At what price point does participant attrition become a financial risk? These are questions your board should be asking — and your CFO should be able to answer.

Mistake 3: Underpricing Care Management

Care management is one of the most underpriced services in the aged care sector. Providers consistently charge less for care management than it costs to deliver, because they are accustomed to recovering care management costs through package management fees rather than direct service pricing.

Under Support at Home, care management must be priced to cover its actual cost. A care manager spending two hours per month on a participant's care coordination, at a fully loaded cost of $80 to $100 per hour, costs $160 to $200 per month to deliver. If you are charging $80 per month for care management, you are subsidising it from other service margins — and that subsidy will erode your overall financial position.

Mistake 4: Failing to Model Workforce Cost Escalation

Aged care workforce costs are not static. Enterprise agreement increases, superannuation guarantee increases, and the ongoing impact of the Fair Work Commission's aged care work value decision mean that your labour costs will increase by 3 to 6 per cent per year for the foreseeable future.

If your Support at Home prices are set based on today's workforce costs without a built-in escalation mechanism, your margin will compress every year. Build annual price review triggers into your participant agreements, and model the impact of workforce cost escalation on your margin over a three-year horizon before finalising your pricing structure.

Mistake 5: Not Building a Contingency Buffer

Support at Home is a new funding model. There will be implementation issues, payment delays, and unexpected costs in the first 12 to 24 months. Providers who have priced to the minimum viable margin will have no buffer to absorb these shocks.

Build a contingency buffer of at least 5 per cent into your pricing model for the first two years of Support at Home operation. This buffer can be reduced as the model stabilises and your cost structure becomes more predictable.

How to Build a Support at Home Pricing Model That Protects Your Margin

A robust Support at Home pricing model has four components: a cost model, a competitive analysis, a volume model, and a margin sensitivity analysis. Here is how to build each one.

Cost model: For each service type you deliver, calculate the fully loaded cost per hour of service delivery. Include direct labour (at award or enterprise agreement rates plus on-costs), indirect labour (supervision, training, recruitment amortised over service hours), vehicle and travel costs, and an overhead allocation based on your total overhead as a percentage of direct labour hours.

Competitive analysis: Research the prices charged by your three to five main competitors in your local market. This does not mean matching their prices — it means understanding the competitive context in which your prices will be evaluated by participants and their families.

Volume model: Project your participant numbers under three scenarios: base case (current participants retained), downside (10 per cent attrition), and upside (10 per cent growth). For each scenario, calculate the revenue and margin impact of your proposed pricing structure.

Margin sensitivity analysis: Test your pricing model against a range of assumptions: workforce cost increases of 3, 5, and 7 per cent; participant attrition of 5, 10, and 20 per cent; and care management hours per participant of 1, 2, and 3 hours per month. Identify the combinations of assumptions that would push your margin below your minimum acceptable threshold — and build pricing buffers to protect against those scenarios.

For detailed guidance on the aged care funding advisory process, including Support at Home transition planning, visit the CFO Insights aged care hub. You may also find the Support at Home CFO checklist and the Support at Home financial impact guide useful starting points.

The CFO's 90-Day Support at Home Pricing Transition Plan

If your organisation has not yet completed a full Support at Home pricing review, the following 90-day plan provides a structured approach to getting your pricing right before the financial consequences of under-pricing become irreversible.

Days 1 to 30 — Cost modelling: Build a fully loaded cost model for each service type. Identify the minimum price required to cover costs at your current volume. Compare this to your current prices and quantify the gap.

Days 31 to 60 — Competitive analysis and pricing decision: Research competitor pricing in your local market. Model the volume impact of pricing at, above, and below the competitive midpoint. Make a pricing decision for each service type that balances cost recovery, competitive positioning, and margin target.

Days 61 to 90 — Implementation and communication: Update participant agreements to reflect new prices. Communicate price changes to participants and their families with appropriate notice periods. Build price review triggers into agreements for annual escalation. Update your financial model to reflect the new pricing structure and reforecast your margin for the next 12 months.

This 90-day plan is most effective when led by a CFO with aged care sector expertise. If your organisation does not have that capability internally, a fractional CFO engagement provides the financial leadership required to execute this transition without the cost of a full-time hire.

Next Steps: Get Expert Support at Home Financial Guidance

Support at Home pricing is not a set-and-forget decision. It requires ongoing monitoring, annual review, and the financial modelling capability to respond to changes in your cost structure, competitive environment, and participant mix.

Steven Taylor, MBA CPA FMVA, works with aged care providers across Australia to build pricing models, financial governance frameworks, and board reporting systems that protect margin through funding model transitions. With 18 years of sector experience and a track record of managing $500 million in aged care budgets, he brings the depth of expertise that Support at Home pricing decisions require.

To discuss your Support at Home pricing strategy, visit the CFO Insights contact page or explore the full range of aged care funding advisory services.