In a move to be announced by Prime Minister Scott Morrison and Aged Care Minister Richard Colbeck on Wednesday, $850 million of the new funding will go to the packages, while a further $57.8 million will be spent on the partnership with the states and aged care providers on the COVID-19 pandemic response.

More than $60 million will be spent on improving access for aged care residents to allied health and mental health services, including psychiatrists, psychologists and GPs.

It includes a dedicated $15.7 million for allied health services for residents in facilities with COVID-19 outbreaks.

The Serious Incident Response Scheme, which is designed to protect older Australians from abuse and neglect, will also receive $11.1 million over the next five years.

The 10,000 home care packages will be spread evenly across the four different levels of packages, and be released by 2020-21.

"By providing more support to people at home, we are ensuring that Australians, as they age, have greater choices, and their families have greater choices," Prime Minister Scott Morrison said.

The government says 50,000 extra home care packages have been funded since the interim report from the aged care royal commission, but Labor has continued to call for more to be done.

In June there were 102,081 Australians waiting for a home care package at the level for which they had been approved, and the list could grow further, with evidence older Australians are delaying entering nursing homes because of the COVID-19 pandemic.

Department of Health figures show 28,000 people died while on the waiting list in the past two years.

According to data released by Infrastructure Australia on Wednesday, aged care occupancy has fallen to its lowest rate in more than 10 years. Just 89.1 per cent of aged care beds are currently occupied.

At the same time, the number of home care recipients has increased by 38 per cent year on year, to about 137,000 in April this year.