A damning royal commission report has outlined reform options including raising the Medicare levy or an income tax rise.

Aged Care Minister Greg Hunt said cabinet would consider those recommendations before laying out a plan to overhaul funding for the ailing sector in May.

“We’ll consider that and we’ll respond as part of the overall budget,” he told Sky News.

“When we’re laying out a five-year plan, we want to do that comprehensively in the context of the budget so we understand all of the investments but then of course the ability to pay for it.”

The government announced an initial response to the final report of $452 million for the sector but massive investment is needed to fix aged care.

The commission’s report made 148 recommendations and found one in three aged care residents had experienced substandard care.

Commissioners Tony Pagone QC and Lynelle Briggs split in their recommended funding models.

Pagone said an aged care levy legally tied to funding the sector would be optimal, while also raising the prospect of an income tax rise.

Briggs is in favour of a potential levy not being legally tied to aged care.

But she wants an ongoing collection mechanism to make a significant contribution to funding royal commission recommendations.

The report calls for home care packages to be approved within a month of assessment and for staff to receive a minimum amount of training, similar to child care.

Council on the Ageing chief executive Ian Yates wants the government to ensure all home care package needs are met by the end of next year.

“Australians want their care at home and must be supported to stay there as long as they can instead of being forced into residential care against their wishes.”

Hunt said 500 audits would be put in place to ensure value for money in home care.

“It’s about increasing home care and increasing viability in residential home care which then leads on to quality,” he said.

“At the end of the day, the big take away is our national culture has to be to think of our older Australians as our elders to be celebrated, to be supported.”

National Seniors Australia cited evidence from the commission that there are more than 100,000 people waiting for a Commonwealth home care package.

In one 12-month period 16,000 people died waiting for approval.

“If we want to transform the system the emphasis must be on home care. It’s the pivot point for transformational change,” National Seniors chief executive John McCallum said.