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We’re nearly all in agreement

We must now guard against getting stuck in the ‘who pays’ 1997 debate, writes Martin Laverty.

18 months of consultations, 480 submissions, a 507 page report, and 41 recommendations.

An immense amount of effort from so many different people has gone into producing an extraordinary report on the future of aged care. Despite all that work, a single ‘ground hog day’ factor will likely determine what happens next.

When aged care was last reformed in 1997, it was the question of ‘who should pay for what’ that caused real reform to stall. It’s no surprise this same ‘who pays’ question is back, but this time the commission has offered some answers.

The commission’s report does well to identify the three key weaknesses of the current aged care system. It confirms aged care is difficult to access, and that the system confusing to navigate. The report highlights the limitation on choice for consumers, caused by rationed services. The report points to system sustainability problems, by detailing the shortfall in both financial and human resources.

The recommendations of the commission embrace many of the proposals put by Catholic Health Australia’s (CHA) several submissions to the inquiry, which argued for a system built on an entitlement of access to services based on assessed need; consumer choice of providers and where services are delivered; and sustainability of services based on prices set by independent and transparent assessments of the cost of care delivery. CHA accordingly applauds much of what the commission has put forward.

The proposed establishment of an Australian Seniors Gateway Agency to provide information; assessment of care needs; assessment of financial capacity to make co-contributions; entitlements to approved services; care coordination; and carer assessments – all via a regional structure – is critical for the operation of a more integrated end-to-end care system. It will help Government manage fiscal risk, and support consumers and providers. CHA first floated such an idea in 2008 via our ‘one stop shop’ proposal. Aged care consumers through COTA also put this idea forward. We’re delighted the commission thinks similarly to both COTA and CHA.

The proposed establishment of a single integrated and flexible system of care provision that incorporates HACC, current care packages, and care provided in aged care homes, will give consumers the option to choose their preferred approved provider or providers of care. This is an essential reform to facilitate choice of care delivery, and provide consumers greater confidence that support will increase as their care needs change, without having to change care provider or the setting in which it is received.

On the question of ‘who should pay,’ CHA supports the commission’s principles proposed to guide the funding of aged care. The commission argues accommodation and everyday living expenses be the responsibility of individuals, with a safety net for those of limited means. The commission further proposes that health services should attract a universal subsidy, consistent with Medicare principles of universal access. CHA, like many aged care provider groups, agrees.

It’s also the commission’s view that consumers should be asked to contribute towards the cost of their personal care, but should not be exposed to catastrophic costs. System sustainability and equity of access revolve around these principles. CHA agrees – it’s what we’ve argued for since the release of our 2008 Aged Care Policy Blueprint. Yet we reiterate our firm view that whilst those who can afford to pay should, those who can not need the security of a real and meaningful social safety net. It is this provision of the social safety net that motivates Catholic providers of aged care, and we remain willing to play our role in caring for the most marginalised of our society.

The removal of regulatory restrictions on the number of community packages and bed licences, and removing the low-high care distinction is a necessary reform to allow consumer choice and entitlement based on need. It will require providers to be more responsive to consumer preferences. Yet it will also mean big changes for providers. Bed licences and package allocations provide providers with business certainty. The removal of this business certainty will bring a new dynamic. The timing of the move to this new arrangement will need to ensure providers are able to adopt to this new less certain environment.

The proposal to give consumers choice between paying a daily charge or an equivalent bond for accommodation costs in residential care, aligned to the real cost of accommodation, will be welcomed by many consumers. For those not wanting to sell a family home to meet accommodation costs, the proposed government guaranteed reverse equity scheme means a likely end to the need for the forced sale of a much loved residence.

Despite our ringing support for what the commission has put forward, the complexity and risks for consumers, providers and Government associated with the implementation of the reforms, cannot be overstated. Many providers, consumers, and union groups agree on the commission’s directions, but we must proceed appropriately to develop reform detail and phased implementation plans so as not to bring shock to an already overstretched aged care system.

With the commission’s report up for comment and debate before a final blueprint is handed to government mid-year, many agree the PC has got the direction right. Our two tasks now must be to guard against getting stuck in the ‘who pays’ 1997 debate, and designing the implementation plan in a manner that will ensure change comes without pain.

Martin Laverty is the CEO of Catholic Health Australia

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