A class action lawsuit has been filed in the Federal Court against Arcare, one of Australia's largest aged care providers, alleging that it illegally charged residents for additional services they could not use or for services it was legally obliged to provide.
Allegations of illegal fees across multiple states
The suit, filed on behalf of residents across more than 50 Arcare facilities in New South Wales, Victoria, Queensland, and the Australian Capital Territory, claims that between July 2020 and July 2026, residents were charged a daily “additional services fee” as part of a “signature package.” This fee was applied even to residents who were immobile, unable to swallow, or cognitively impaired.
The statement of claim alleges that Arcare, a for-profit provider, charged for services such as meals that it is already legally required to provide under aged care legislation. It also claims that residents were charged for additional services they could not access or benefit from.
Legal obligations and unconscionable conduct
According to Australian aged care laws, providers can only charge fees for additional care and services if the resident agrees, is able to access and benefit from them, and has the capacity to use them. The lawsuit alleges that Arcare engaged in unconscionable conduct by exploiting the unequal bargaining position of vulnerable residents who relied on aged care due to medical or social needs. Residents were told that the signature packages were non-negotiable and that the additional services fee was a mandatory condition of admission.
“The signature package included mandatory services that Arcare was obliged to provide … and could not lawfully charge for as additional services,” the statement of claim states.
Specific services allegedly overcharged
The claim details that bundled fees for high teas, a choice of menu, and alcoholic beverages were charged to residents on prescribed dietary regimes, receiving enteral nutrition or pureed diets, or who lacked capacity to make menu selections. Some residents who could not operate a television or comprehend audio-visual content, or who were unconscious, were charged for Foxtel, newspapers, and wireless internet. Residents who were non-ambulatory or confined to bed were charged for bus outings and exercise classes.
It is further alleged that Arcare used financial information about residents to set fees, charging individual residents a price reflecting what Arcare assessed they could afford rather than the true value of services provided.
Case filed on behalf of former resident
The lawsuit was filed on behalf of Dianne Strickland, an 82-year-old former resident of Arcare Carnegie in Victoria. According to the statement of claim, Strickland suffers from osteoarthritic pain and reduced mobility, and was physically unable to participate in or benefit from exercise classes and bus outings she was charged for. It is alleged she had no knowledge of how to use wireless internet technology and was billed daily for in-room wifi despite not owning a smartphone, tablet, or computer.
The class action represents anyone who lived at an Arcare facility in the four jurisdictions during the six-year period and paid the additional services fee. Damian Scattini, a partner at law firm Quinn Emanuel Urquhart & Sullivan acting for the applicants, said the case alleges Arcare took advantage of vulnerable residents or their families by charging for services “that were either never delivered or that Arcare was already obliged to provide under their agreements and under Australian aged-care legislation.”
“That is not an oversight,” he said. “That is a systemic failure that caused real financial harm to people who had already placed their trust and wellbeing in Arcare’s hands.” He estimated that about 7,500 residents were affected during the claim period. “We are determined to hold Arcare to account and to recover what these residents are owed.”
Arcare's response
Arcare has yet to file its response to the court. A spokesperson said that as the matter is before the court, “it would not be appropriate to comment on the allegations or the legal proceedings.” The spokesperson added, “Arcare remains committed to providing high-quality care and services that support each resident’s choice, independence and dignity. We value feedback from our residents and their families.”
