DAP Indexation
Your daily payment will now increase twice a year. Here's what that costs.
What changed?
From 1 November 2025, Daily Accommodation Payments (DAP) are indexed to the Consumer Price Index (CPI). This means your daily payment increases twice a year — on 20 March and 20 September.
Before this change, your DAP was locked at the rate set when you entered care. Now it grows with inflation.
What does this cost in dollar terms?
Assuming a $500,000 room, 7.65% MPIR, and ~3.5% annual CPI:
| Year | Daily DAP | Annual cost | Cumulative total |
|---|---|---|---|
| Year 1 | $104.79 | $38,250 | $38,250 |
| Year 2 | $108.46 | $39,589 | $77,839 |
| Year 3 | $112.26 | $40,975 | $118,814 |
| Year 4 | $116.19 | $42,409 | $161,223 |
| Year 5 | $120.25 | $43,893 | $205,116 |
Without indexation, 5 years of DAP would cost $191,250. With indexation, it costs ~$205,116 — about $14,000 more. Over longer stays, the gap widens significantly.
Why does this matter for RAD vs DAP?
DAP indexation makes the full DAP option more expensive for longer stays. The compounding effect of CPI means DAP costs accelerate over time, while RAD retention is capped at 5 years.
For stays of 5+ years, this change significantly favours RAD or combination payments over full DAP.
For shorter stays (1–2 years), the indexation impact is modest — one or two CPI adjustments won't dramatically change the comparison.
Does this apply to everyone?
No. People who entered care before 1 November 2025 are grandfathered — their DAP remains fixed at the entry rate. Indexation only applies to people who entered care on or after 1 November 2025.
See the impact on your numbers
Our calculator models DAP indexation at 3.5% CPI, so you can see the true projected cost over your expected stay.
Use the calculator →CPI projections are estimates based on current inflation trends. Actual indexation will depend on published CPI figures at each adjustment date. This does not constitute financial advice.