Home | Industry+Policy | Federal election 2013 – What’s on the aged care agenda?

Federal election 2013 – What’s on the aged care agenda?

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The major parties look like relying primarily on existing policies to spruik their aged care credentials. Fiona Marsden reports.

With this year’s election coming just a few months after the federal budget and a senate committee inquiry, Labor is pinning its aged care policy hopes on the passage of its $3.7 billion Living Longer Living Better (LLLB) package.

The LLLB’s key reforms include increasing the number of home and residential care places, revamping fee arrangements, and boosting wages and training for aged care workers.

“I have been determined to give the aged care sector the funding certainty it has sought for decades,” says Mark Butler, former minister for Mental Health and Ageing.

“Not only does Living Longer Living Better articulate the government’s intentions and funded commitments for the 2013–14 budget, it lays out our commitments between now and 2016–17.

“That allows providers to plan for the future of their organisations, and provides peace of mind to Australians that the right care will be available as they get older and require aged care services.”

Although LLLB was announced in April 2012, the legislation wasn’t introduced until March this year. With the package’s home care changes and dementia supplement set to take effect from July 1, this left parliament little time to consider the bills.

In mid-March, the senate referred the bills to the Community Affairs Committee, which reported on May 31.

The report’s 13 recommendations include calls for close monitoring and evaluation of the effects of the LLLB legislation on care providers—particularly low-care-only, small and rural/ regional providers. At time of writing, the government was yet to respond to the recommendations.

The Coalition’s model

The Coalition’s central policy platform is a four-year Aged Care Provider Agreement, to be negotiated in consultation with providers and other stakeholders within the first year of government.

“The implications of an ageing population, including an increasingly larger culturally diverse ageing population and the need to increase aged care services, means it is important that we formulate policies that can actually be delivered on,” says shadow minister for ageing, senator Concetta Fierravanti-Wells.

“There is growing and alarming evidence that the aged care sector cannot provide the care that Australians expect. Until there is structural reform of the sector, the care and wellbeing of senior Australians is at risk.”

Senator Fierravanti-Wells says that, like the agreements that provide the framework for the pharmacy profession, the Aged Care Provider Agreement will act as a game changer for the aged care sector by providing certainty and flexibility. “These two factors have been the standout complaints that many in the sector say [desperately need addressing].”

The senator also says the agreement will reduce the current administrative load facing aged care providers.

“One major part of aged care that has been sadly overlooked by this government’s so-called reform [is] any commitment to reducing the administrative burden that plagues the sector,” she says.

“Every hour a staff member spends meeting regulatory reporting requirements, is an hour less spent on providing hands-on care and support for an older Australian. The Coalition’s plan is to work with the sector to remove this cumbersome burden, without reducing the quality of care. This will be a key feature of our Aged Care Provider Agreement.”

The breakdown

When Aged Care Insite asked the Coalition for more specific comment on how its proposed agreement would address key areas of aged care provision, senator Fierravanti-Wells said she did not want to pre-empt the outcome of any negotiations a Coalition government might undertake with the aged care sector.

Nonetheless, we have done our best to break down the major parties’ aged care policies into three key areas – home and residential care, dementia care and workforce sustainability – to help you work through the potential implications for your roles as aged care providers and workers.

Home and residential care

Labor’s LLLB package provides $955 million for home care services, including 40,000 new packages over five years to help people remain in their own homes.

The Home Care Packages Program is scheduled to begin on July 1 2013. It will replace Community Aged Care Packages, Extended Aged Care at Home, and Extended Aged Care at Home Dementia packages.

LLLB also allocates $660 million for residential aged care; including more than 30,000 new places over five years, changes to means testing for fee payments, and trials of consumer directed care in residential aged care settings.

The Coalition has not yet elaborated on the kinds of funding arrangements for home and residential care places it might seek to negotiate as part of an Aged Care Provider Agreement.

Within this context, the CEOs of two of Australia’s leading aged care sector organisations (which have been extensively involved in the LLLB consultations) are broadly supportive of Labor’s package in regards to home and residential care, while saying it does not go far enough in some critical areas.

“The aged care market has a rationed supply,” says John Kelly, CEO of Aged and Community Services Australia, which represents more than 1100 church, charitable and community-based providers. “The government controls who can have beds, where they go and exactly how they can operate.

“As long as aged care [remains] an artificial market, it’s very hard for providers to plan services appropriately in terms of community demand, and put offerings on the table to address different levels of demand.”

While acknowledging that the LLLB package includes provision to review the supply issue after five years, Kelly believes that’s too long to wait. “Lead times for planning and capital expenditure on aged care facilities are quite long,” he says, “and the pace of change in the over-65 demographic is such now that five years is too far away.”

Ian Yates of COTA Australia, which represents older Australians as consumers of aged care services, says the LLLB’s commitments to home care and Consumer Directed Care are significant, but says a future government (be it Labor or Coalition) must address the issue of entitlement.

“The largest single thing COTA wants is a move to the end of rationing and the introduction of entitlement, whereby entry into aged care is [based on] a rigorous assessment of need.

“On the basis of that assessment, the Commonwealth would accept that you as the consumer are entitled to an amount of money – not something that can be cashed out, but a voucher, if you like – that you can spend on resources as you choose.”

Dementia care

The LLLB earmarks $268 million for dementia funding. This includes a dementia supplement for home and residential care to apply from July 1, 2013, in recognition of the higher costs involved in caring for people with severe dementia.

At time of writing, the proposed supplement is $16.15 per day for people in residential care, and 10 per cent funding in addition to the basic subsidy level for the relevant Home Care Package.

Opposition spokesperson senator Fierravanti-Wells declined to detail any dementia-specific measures the Coalition might unveil. However, she pointed out that the Howard government committed $320 million in the 2005 budget to help fund the Dementia Initiative—Making Dementia a National Health Priority.

“Despite this initiative proving invaluable in helping dementia sufferers, and a government evaluation of October 2009 finding the initiative successful, Labor deliberately dropped this program,” she says. “Labor … has only recently made up some lost ground with its $268 million package.

“The Coalition remains committed to addressing the growing numbers of [people with] dementia in Australia, and, without pre-empting the negotiations of our aged care agreement, I would envisage that such matters would be covered.”

Workforce sustainability

A centrepiece of Labor’s LLLB package is $1.2 billion to shore up the aged care workforce. This includes an Aged Care Workforce Development Plan, which will be developed during 2013 to improve:

• career structures and pathways

• training and education

• career development opportunities

• work practices

• workforce planning.

The package also includes a Workforce Supplement payable to eligible employers from July 1 this year; starting with 1 per cent of the amount of the basic subsidy/funding agreement in 2013–14, and rising to 3.5 per cent in 2016–17.

To be eligible for the Workforce Supplement, employers must be approved residential aged care providers who are eligible for the payment of a basic subsidy in respect of a resident, under the Aged Care Act 1997. Providers must pass on the supplement in the form of higher wages.

“Labor’s plan to grow our workforce has been developed in consultation with consumers, providers and unions, and is fully costed and articulated,” says minister Butler, “unlike the opposition’s ‘policy’ which appears to be little more than business as usual, [and will] not deliver the better pay and conditions we need for our workers.”

His counterpart senator Fierravanti-Wells is a strident critic of the Workforce Supplement. “We all accept wage rises are needed,” she says, “but they need to be affordable and sustainable.

“With only 40 per cent of providers operating in the black, many will be unable to pay the wage increase and meet the associated on-costs. These cost pressures will further erode their viability, especially [for] smaller providers in regional and rural areas.”

In their dissenting report attached to the Senate Community Affairs Committee’s report, participating Coalition senators recommended removing all provisions in the LLLB Bills that refer to the Workforce Supplement. The overall committee, however, did not support this.

As for how she plans to address workforce sustainability, senator Fierravanti-Wells says, “Whilst the Coalition does not want to pre-empt the contents of any formally negotiated agreement, we do envisage that it will contain measures to address concerns in regards to wage and staff retention.”

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