Imagine discovering you’d been paying thousands of dollars more per year for something than you should have been.
For many people, that’s the sort of discrepancy they couldn’t help but notice, but it can happen – and it did. In this case, the mismatch arose from a few basic mistakes in information lodged by one couple with Centrelink.
At the centre of the mix-up was a man suffering from dementia who had recently moved to an aged care facility. The man’s wife noticed by chance that the value of the couple’s assets was overstated by $400,000.
As assets are used to assess fees payable, this discrepancy affected the accommodation contribution required from the couple. They were paying $126 a day plus the basic daily fee, and a means-tested care fee. What they should have been paying was roughly $45 a day plus the basic daily fee.
A discrepancy of $81 per day very quickly blows out to thousands of dollars.
The Centrelink miscalculations were the result of two errors in the assessment by the couple. The first was a straight overstatement in cash assets of $50,000. The amount had been withdrawn more than two decades earlier and used it to buy a motorhome, which they later sold but the $50,000 wasn’t taken off their assessment.
Second, a superannuation account from which the couple had been drawing a pension for a similar period – over two decades – was accidentally tagged as being in the accumulation phase. That added to the fees the couple should not have been paying.
Correcting errors in the Centrelink assessment
The finer details of this particular story are, understandably, not public but Centrelink has told YourLifeChoices that they can only assess aged care costs based on the information provided by the retiree.
“Once aged care costs have been assessed, it’s important for customers to continue to keep their personal and financial details up-to-date with Services Australia or the Department of Veterans Affairs, if applicable,” Services Australia General Manager Hank Jongen said.
“This is because changes to a person’s circumstances can change how much they pay towards their aged care costs.
“We encourage people to carefully check [the letter from Services Australia] to ensure the information and assets that we’ve used to assess their aged care costs are correct. The letter has contact details for customers to let us or the DVA know if the personal and financial information used is incorrect out out-of-date.”
The experience of this couple’s story serves as a reminder. When dealing with Centrelink (or any institution), it’s important to make sure your details are recorded correctly.
In cases such as this, that includes financial details. Given the Robodebt disaster, many people are understandably wary of disclosing personal financial details to Centrelink. But this story shows that the consequences of errors can cut both ways.
What can we do?
What is recommended is checking that Centrelink representatives record all your provided details correctly when you provide them. And it would pay to do a periodic check on these to make sure they remain correct.
Services Australia also allows people such as a friend or family member to have an authorised representative to deal with Centrelink on their behalf. Aged care recipients can also appoint a person or organisation to support them in their dealings with My Aged Care. This is especially important if, like one half of the couple in this story, the recipient has dementia.
Such checks and appointments would, of course, require making contact with Centrelink, which is more often than not a challenge in itself. But doing so could well ensure you’re not thousands of dollars out of pocket.
Have you discovered incorrect details recorded by Centrelink? What was your experience of attempting to get them corrected? Let us know via the comments section below.
Also read: Centrelink accused of ‘refusing to take calls’
Disclaimer: This article was amended on 22nd Feb to include a quote from Services Australia and to remove the suggestion that it was a Centrelink error that contributed to this case. All content on YourLifeChoices website is of a general nature and has been prepared without taking into account your objectives, financial situation or needs. It has been prepared with due care but no guarantees are provided for the ongoing accuracy or relevance. Before making a decision based on this information, you should consider its appropriateness in regard to your own circumstances. You should seek professional advice from a financial planner, lawyer or tax agent in relation to any aspects that affect your financial and legal circumstances.
Hi Andrew
We have received a letter from Centrelink saying we owe about $24000 in overpayments stemming from a inheritance of a1/3 of a villa.The villa had a life interest placed on it and we couldn’t charge rent or sell as my aunts partner was still living in it .
I filled out the mod R form for the villa and went and saw them but they didn’t have any idea how to process it and still don’t, they said their was about 4 people that work for Centrelink that could maybe help
Don’t know if you have any advice on how to approach it
Kind regards
Ross
Re Centerlink Errors, There is no need to call Centrelink and wait on the phone. Sign up to “My Gov” and you Caa access all your records.
lol, not always will the information be there no matter how hard you search your account. Personal experience has told me that.
Even going into My Gov and changing assets etc. will not be actioned even months later until you actually call them, if you’re lucky enough to get through. And it must be the 1st time otherwise they redirect your number to a recording that hangs up at the end.
Even when Centrelink make changes themselves they don’t inform you either. Usually you find out when less or even no pension goes into your account.
After an assessment Centrelink should send you that assessment so you can either approve or make adjustments with backup evidence.
Getting it right the 1st time is far less time consuming and costly than fixing it later for all parties.
Absolutely totally agree with you Karl. Edward must live in fairy land. Firstly, if your query does not match one of the menus in MyGov – bad luck. Then waiting for a reply can take months. I lodged an online query – was 3 and a half months before I got a reply, which was useless by then. Try and ring? – get passed around and around to different extensions, then to be told that your query is a ‘specialized area’ and there is no-one to assist you at this time. I always ask for EMAIL replies, so as to have my query in writing. But no, they ring, send an SMS message saying someone will ring from an unlisted number, usually within half an hour, and you better answer it because of you don’t, it will be impossible to speak to anyone who knows about the query. Even with a reference number, you have to go over and over the query, again and again. So I have to be available any time they want to ring, but if I ring, tough getting to speak to anyone. I have a current query relating to the Work Bonus scheme, and NO-ONE can help me. It’s the same old story – ‘our figures are correctly calculated’ – but they will not say hoe calculated, it’s just tough, their word is gospel.
Edward
I update every few months bank dividends etc last time myGov wouldn’t let me update so made an appointment and spoke to them and that’s when they told me about the debt and they don’t know how to fix it
Would be helpful if Centrelink provided details of how they calculate amounts so people could self assess and ensure transparency/accuracy.
Bruce raises a very pertinent point..
In the Centrelink Agedcare home means test assessment the formula is not available to those paying the fee.As an example it is only recently come to notice that in fact the means test formula does in fact contain a home cost component,for those couples separated by illness.
What else does the formula contain that is invisible to the person paying the fee.
In terms of EDWARDES comment about the on line access the updating issue is a nightmare as the income and payments updates are frozen when someone has already applied for say a pension.
My experience with Centrelink is littered with errors in the calculations but once you get a zealous and knowledgeable employee they are fantastic in fixing your problem.
Most senior citizens really value FIZ.s work .
That’s what makes it so frustrating in the time taking to assess say an old age pension ,when Fiz have already checked the numbers and you are eligible.
We are a 78 year old couple with a tick and flick application for a pension ,now that we are under the Assets test, but I will bet a lotto ticket that within the 90 plus delay some figure has altered and requires updating..
I am just amazed that the Govt and the media is basically silent on the issue.
However when the Govt and The Agedcare providers want to increase the fees they use terms like wealthy baby boomers sell their social engineering policies.
The OAP is far to complex and every individual is assessed separately. That’s around 2.8 million OAP’s, and that’s increasing daily, come under constant assessment review.
Australia needs a universal base pension paid to every Australian 67 and older then tax all income the same as all working Australians including super. Super has now become a wealth creation vehicle for the rich who are legally exploiting the system.
Australian governments have been told for decades by the countries top economists and financial advisors that what they are doing needs radicle changes in OAP, tax reform, aged care etc.
Won’t happen in my lifetime though.
Centrelink used to send out forms twice a year detailing income and assets, giving customers the opportunity to check details were correct.
I operate a very small and unprofitable hobby business. Thankfully, we do not qualify for a pension anyway, but we will soon with the reduction of assets and raising of thresholds and then I will have a problem. When Centrelink assessed our assets 10 years ago (we did qualify for a small pension at that time) they DOUBLED the value of my business assets. Their logic was that if the business was half owned by me and half by my husband, then it must be worth TWICE the value stated on tax returns and asset statements. Obviously, this is nonsense, and I argued for ages, talking to more than 6 people, all of whom were intractable. I can’t fix the error because they have locked my account so that only Centrelink staff can update financial information. It is therefore 10 years out of date, and entirely wrong. I despair of ever getting them to fix this. No matter how many times I explained that we each owned HALF of the business and therefore HALF of it’s value, they continued to insist the value had to be doubled.
I am now thinking the only solution may be to close the business and liquidate the assets, otherwise, we will be unfairly denied pension benefits because incompetent people are stubborn.