The federal minister in charge insists artificial intelligence is not being used to decide the level of care people receive in their home.
The government's Integrated Assessment Tool was rolled out in November to distribute funding more equitably, with algorithms deciding how much money to allocate to people.
More than 1000 people asked for their claim to be reviewed, with large numbers of complaints about the decision being irreversible.
Aged Care Minister Sam Rae on Thursday conceded changes would be made to allow a review of decisions in extenuating circumstances.
He said the changes would make the aged care system fairer, but denied computer systems were solely determining support levels
"There is no artificial intelligence in our aged care assessment system, and it is dishonest for any actor to pretend otherwise," he told parliament.
"We'll continue to make sure that Australians get the very best care, that's what they deserve."
A bill brought on by the Liberals, Greens and independent senator David Pocock passed the Senate that would bring back human oversight to the tool.
However, the bill will not pass parliament due to Labor, who voted against the law, having the numbers to block it in the House of Representatives.
Opposition health spokeswoman Anne Ruston said the government had ignored the needs of older Australians.
 "These are people, they're not numbers on a piece of paper," Senator Ruston told reporters.
"For a government that came into power in 2022 promising to put the care back into aged care, all they have done is short-change older Australians"
The Older Persons Advocacy network welcomed the changes to the tool, with its chief executive Craig Gear saying the algorithm had caused confusion.
"These assessments have a real impact on an older person's life, so it is crucial that a human remains part of the decision making and outcomes," he said.
"Several details, including pathways to appeal a decision, need clarification and consultation. The changes must cater for an older person's changing circumstances, given the complex needs of older people."
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