Older Australians living in nursing homes have some of the highest rates of depression and anxiety, but most are excluded from Medicare-funded psychological treatment available to the wider community, aged care advocates say.

About one third of aged care residents have depression and anxiety — making them two to three times more likely to have the conditions than older people living in the general community, according to studies by the National Aging Research Institute.

Aged and Community Services Australia, which represents not-for-profit aged care providers, has released a statement saying it believes the Government has a responsibility to make mental health treatments and services readily accessible and available to all Australians — including those living in residential aged care.

COTA Australia chief executive Ian Yates called for an end to the inequity.

"Many older Australians end up entering residential aged care with mental illness because we tend to regard mental illness as an inevitable part of aging, which it isn't," Mr Yates said.

"And, every mental health plan that the Commonwealth and the states have had has put older people at the back of the bus."

Mr Yates said most nursing home residents have not had the benefit of seeing Medicare-funded psychologists.

"The fact that aged care residents are excluded from [Medicare-funded psychological care] is a historical anomaly," he said.

Australian Psychological Society executive director Professor Lyn Littlefield said it can lead to incorrect medical treatment.

"Often, they're not given the right medication because there's no formal assessment," Professor Littlefield said.

"So, you need a psychologist to assess them to work out what type of mental health problem they've got and often it's anxiety or depression, but very frequently it can be mixed in with dementia."

"If they were receiving that care, their life would have much higher quality.

"They'd be functioning at a much higher level. They'd be more connected and able to connect in with other people."

Professor Littlefield said evidence showed older people can benefit from cognitive behavioural therapy.

AM requested an interview with Acting Health Minister Arthur Sinodinos, but he was not available.