Australia’s shortage of aged care beds is well known. Across the country, thousands of older Australians who are medically ready to leave hospital remain stuck in beds. This is because there is nowhere else for them to go. In response, the Federal Government has committed $115 million to an aged care bed building blitz. This is the latest initiative as part of its Aged Care Capital Assistance Program.
The funding will target areas experiencing significant pressure on hospital and aged care systems, including Adelaide, Perth and the Illawarra and Hunter regions of New South Wales. The aim is for the new beds to be built and operational within the next two years.
So, what’s behind the move and what has been the reaction?
What’s behind the move?
In recent months, state and territory health ministers have been putting pressure on the Federal Government to address the growing number of aged care patients stuck in hospitals around the country.
In February, it was revealed that the number had reached 3,100 nationally. This represents an increase of 30 per cent in just five months.
These patients are medically ready to be discharged but still require care either in an aged care home or in their own home. As a result, they remain in hospital while waiting for either a residential aged care bed to become available or an appropriate home care package.
Aged care bed shortages in South Australia have been especially significant. To help ease pressure on hospitals, the state government has converted several floors of a five-star hotel into a temporary aged care facility.
What does the funding proposal involve?
Who will build the beds will be decided through an Expression of Interest (EOI) process. The first EOI will focus on Adelaide and the Illawarra. Meanwhile, the second will focus on Perth and the Hunter.
More rounds will follow later this year to ensure continued investment in regional areas.
The Government says the latest funding will bring total investment in the Aged Care Capital Assistance Program to more than $1 billion since 2022.
What has been the reaction?
The Older Person’s Advocacy Group welcomed the announcement. CEO Craig Gear said getting older people out of hospital as quickly as possible is beneficial for health outcomes.
“We know that prolonged stays in acute care often lead to cognitive decline and physical impairment, which is why extra funding is crucial,” he said.
However, critics argue the Government has not specified how many aged care beds the additional funding will actually deliver. There are also concerns from Victorian aged care providers that the state has not been included in the current round of funding. This is despite the issue worsening in Victoria.
In November 2024, there were 187 blocked beds in Victorian public hospitals. By November 2025, that number had risen to 251. Based on current trends, the number of blocked beds in Victoria is increasing by around 60 each year.
Some experts say releasing more Support at Home funding could help alleviate the issue.
With demand for aged care continuing to rise, the sector will require more skilled workers to support older Australians in both residential care and home-based settings. For jobseekers, this could create new opportunities to enter or progress in the aged care workforce.
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Article References
Cross, J (5 March 2026) ‘New $115m plan to build aged care beds for patients stranded in hospitals’, Daily Telegraph, accessed 6 March 2026.
Older Person’s Advocacy Network (6 March 2026) ‘NEW AGED CARE FUNDING WELCOMED’, Older Persons Advocacy Network, accessed 6 March 2026.