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 services they could not use or that it was legally obliged to provide. The claim covers more than 50 facilities across New South Wales, Victoria, Queensland, and the Australian Capital Territory.
Allegations of Unlawful Fees
The lawsuit, filed on behalf of former resident Dianne Strickland, alleges that between July 2020 and July 2026, Arcare charged residents a daily "additional services fee" embedded within a "signature package." This fee was applied to residents who were immobile, unable to swallow, or cognitively impaired, making it impossible for them to benefit from the services.
According to the statement of claim, Arcare charged for services such as high teas, exercise classes, bus outings, Foxtel, newspapers, and wireless internet, even when residents could not use them. For example, residents on pureed diets or receiving enteral nutrition were billed for high teas and menu choices, while those non-ambulatory or bedridden were charged for exercise classes and outings.
Legal Framework Violated
Under Australian aged care legislation, providers may only charge additional fees if the resident agrees, can access and benefit from the services, and has the capacity to use them. The claim alleges Arcare engaged in unconscionable conduct by presenting the signature package as non-negotiable and a mandatory condition of admission, exploiting residents' unequal bargaining position due to their medical or social needs.
Damian Scattini, a partner at Quinn Emanuel Urquhart & Sullivan representing the applicants, stated: "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. That is a systemic failure that caused real financial harm to people who had already placed their trust and wellbeing in Arcare’s hands."
Arcare's Response
Arcare has yet to file its response to the court. A spokesperson said: "As the matter is currently before the court, it would not be appropriate to comment on the allegations or the legal proceedings. 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."
Impact and Next Steps
The class action represents approximately 7,500 residents who lived at an Arcare facility during the six-year period and paid the additional services fee. The claim seeks to recover these fees and hold Arcare accountable. The case highlights broader concerns about fee structures in the aged care sector and the vulnerability of elderly residents.
