The system and providers have not always responded to needs that are "out of the ordinary", senior counsel assisting the aged care royal commission Peter Gray QC said.

"Some needs remain invisible," Mr Gray said as a week-long hearing focused on diversity in aged care began in Melbourne on Monday.

"Barriers of a cultural, linguistic and experiential nature can all too easily intrude between those providing and those receiving care.

"Unless careful attention is given to these aspects of care, there is a real risk that the system will leave older people isolated and neglected."

National LGBTI Health Alliance policy manager Samantha Edmonds said meeting the needs of people with diverse characteristics and life experiences should be core business for aged care, although she acknowledged that goal was a long way off.

Ms Edmonds said some aged care providers dealt with diversity well, while others had not even thought about what it might mean to work with people who have diverse needs.

She said aged care providers often said they treat everyone the same, but that did not recognise the unique needs of people with diverse characteristics and life experiences.

"If you treat everybody exactly the same, then you're not delivering person-centred care and you're not meeting the diverse needs of those people," she said.

Ms Edmonds gave the example of an aged care provider that supported a transgender elder to transition.

But she also highlighted the case of a transgender woman who said they would not come out because the aged care environment was not safe.

"I would believe the provider thinks they're delivering fantastic person-centred care to this person but they're actually not, because that person is not feeling safe, is not feeling included," Ms Edmonds said.

The demand for culturally-appropriate services was likely to increase considerably in the future, as the make-up of Australian society continued to change, Mr Gray said.

He noted there will be people for whom admission into any kind of institutional environment would be re-traumatising, such as for many of the "Forgotten Australians" who grew up in children's homes and orphanages.

Federation of Ethnic Communities' Councils of Australia chair Mary Patetsos said aged care services should make all efforts to minimise social isolation, a major factor for those who do not share a language with most other people in their community.

"Every provider in the country has a responsibility to meet the needs of all Australians," she said.

The inquiry will consider the needs of people from culturally and linguistically diverse backgrounds, those who were separated from their parents, Aboriginal and Torres Strait Islander people, the homeless, defence force veterans and lesbian, gay, bisexual, transgender and intersex people.

Australian Associated Press