Aviiid - Third Age Living

Productivity Commission proposes overdue shake-up of aged care sector

Productivity Commission:  Older Australians generally want to remain independent and in control of how and where they live their lives, continue to be connected and relevant to their families and communities, and be able to exercise some measure of choice if they require care.

Changes to the aged care system over the past decade or so have improved the range and quality of care and support available to older Australians. However, fundamental reform is required to overcome the delays, discontinuities, constraints and shortages that currently exist, and to respond to future challenges. These challenges include a significant increase in the number of older people, rising expectations about the care they receive, community concerns about variability in the quality of care, a relative decline in informal carers and a need for significantly more nurses and aged care workers.

Government policies, programs and regulations, and the services offered by community groups and businesses, need to be redesigned around people's wellbeing and delivered in ways that respect their dignity and support their independence. Services need to be affordable both for older people and for society. The Productivity Commission has been asked to develop detailed options to achieve this redesign and to recommend a transition path to the new arrangements.

Key points

Aged care assists over one million older Australians and its range and quality of services have improved over the last decade.

But the system suffers several key weaknesses. It is difficult to navigate and the quantity of services is limited. Quality can be variable, there are gaps in service coverage and limited choices for care recipients. Pricing, subsidies and user co-contributions are inconsistent and inequitable within and between care settings. Workforce shortages are exacerbated by uncompetitive wages and over-regulation.
The system will be further challenged by an increase in the numbers and expectations of older people, a relative decline in informal carers and the need for a larger workforce.

The Commission's proposals address these weaknesses and challenges and promote higher quality care. The focus is on enhancing the wellbeing of older Australians - promoting independence, connectedness and choice. Under the proposed reforms, older Australians would:

• contact a simplified ‘gateway' for: easily understood information; assessments of care needs; assessments of financial capacity to make co-contributions; entitlements to approved services; and care coordination - all at a regional level
• receive a flexible range of care and support services that meet their individual needs and that emphasise, where possible, restorative care and rehabilitation
• choose, where feasible and appropriate, to receive care at home or in a residential facility and choose their approved provider
• contribute in part to their cost of care (with a maximum lifetime limit) and meet their accommodation and living expenses (with safety nets for those with limited means)
• have access to a government sponsored equity release scheme to pay for their care and accommodation charges if they have assets but limited annual incomes
• choose between paying a daily charge or an equivalent bond for the accommodation costs of residential care - with both aligned to the real cost of accommodation
• retain their age pension when selling their home (and if paying a lower capital sum or a daily charge for their new accommodation) by purchasing an Australian Pensioners Bond
• choose whether to purchase additional services or a higher quality of accommodation if that is what they want and can afford to do so.

Safety and quality standards would be retained but current limits on the number of residential places and care packages would be removed, as would the distinctions between low and high care and between ordinary and extra service status.

A new independent regulatory commission would transparently recommend to the Government the price for care services and for standard accommodation for supported residents, be responsible for quality accreditation, and address complaints.

The Australian Government would manage its fiscal exposure by setting the criteria for needs assessments, the resource levels for approved services, the co-contribution schedules and the standard for basic accommodation.

 

Please visit Productivity Commission website for more information.

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