The aged care sector has been on a long journey toward focussing more on the needs and the choices of the people who use it. Hamilton Stone has been intimately involved in some of the key steps along the way, and we are currently helping with a review of an important aspect of how residential aged care can best serve the people who need it.
Allocating residential care funds to consumers rather than providers
A major change was made in 2017, when home care packages were allocated to consumers instead of to providers. Now, a person needing high levels of home care can get their care from any approved provider who is available. They can change providers if they aren’t happy with the care they are getting.
One of the next steps in aged care reform is to do the same for people who want residential care. After announcing that it was providing “in-principle support for the transition of residential places to the consumer”, the government set up a review to analyse the impacts of changes to the current mechanism for allocating aged care places, the Aged Care Approvals Round (ACAR).
This change would bring residential care more into line not only with home care packages, but also childcare and disability services. But how can it best be done?
What’s involved in making this change work for consumers?
There are many factors to consider when making this change. Here are just some issues that the review is aware of.
What information will consumers need in this new environment, so that they can make effective choices that are right for them?
Letting consumers choose any approved provider they want should increase competition between providers and, over time, it is hoped that it will encourage new entrants to the sector and more innovation. What effect will this have on occupancy rates, the viability of providers and the rates they need to charge to be sustainable?
In some rural and remote areas, and for some consumers with special needs, there may be few providers, perhaps only one, offering appropriate care in the right place. How will the new system operate in these so called ‘thin markets’? For example, is there a risk a second provider might try to enter in a small town, and both end up being unsustainable?
Currently respite care places are also allocated to providers. What will be the system for ensuring a supply of respite care in future, when places aren’t allocated to providers any more?
There are many different parts of aged care being reformed, not just the system for allocating residential care places. What is the right order to make changes in, to ensure access to care for consumers is not disrupted?
Stakeholder submissions were received last month. Hamilton Stone is privileged to be assisting UTS’s Mike Woods and Stewart Brown’s Grant Corduroy to prepare a report on these important issues. It is due to be given to the government at the end of the year.