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Aged care providers are calling for a higher consumer contribution and for the government to uncap the basic daily fee, claiming it fails to adequately reflect the increased cost of delivering care.
Catholic Health Australia (CHA), Opal Healthcare, Anglicare Sydney, and Southern Cross Care (Qld) said the 85 per cent cap on the basic daily fee was 'outdated.'
Currently, the maximum daily fee an aged care provider can ask from an aged care recipient is $58.98 per person per day, covering everything from food, laundry, cleaning, and utilities.
This figure doesn't consider a person's wealth, retirement status, or the actual cost of providing a service.
Director of Aged Care at CHA, Jason Kara, said the government should uncap the basic fee for self-funded retirees while maintaining a safety net for those who can't afford to pay more.
"The cap has always led to a cost-of-crisis situation, driving up the price of everything," Mr Kara told Aged Care Insite.
"Aged care providers are losing a lot of money.
"It's time to ask those who can afford it to contribute a little bit more to the cost of their care."
Mr Kara said that, when the cap was set 40 years ago, care services were less comprehensive and expensive than today.
"If people think about their own budget, they would also recognise that $59 a day just isn't appropriate," he said.
StewartBrown's latest report revealed that 63 per cent of aged care facilities were running at a loss, equating to roughly $28 per resident per day.
A 6.3 per cent rise in the consumer price index in the year to February 2023 meant that aged care expenses also increased.
"Aged care facilities are facing cost-of-living pressures, just like everybody else," Mr Kara said.
"But the basic daily fee hasn't changed to compensate for that."
He estimated that Australia's taxpayers were already footing 75 per cent of the aged care costs.
Yesterday, the Albanese government allocated an additional $4.8bn in funding for aged care to meet its financial commitments.
Aged care costs are likely to rise by 23 per cent to $29.6bn in the upcoming financial year, becoming the government's fifth-largest expenditure.
Within two years, the number of Australians needing aged care services increased by 3.5 per cent to a total of 1.5 million people due to an ageing population.
Mr Kara said they've been engaged in discussions with the federal and NSW government, which acknowledged the sector's pressure.
"A lot of aged care recipients just want to ensure quality services are available for them to access.
"It's not just those who are in aged care now; it's also those who might be in aged care tomorrow or next week or next year and their families.
"You want to be sure that you're going into an environment that is sustainable and that you focus on delivering quality outcomes."
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Are aged care facilities profitable?
In 2020–21, 46 per cent of providers reported a positive net profit, representing 42 per cent of total operational beds in the residential care sector.
This article is deliberately misleading.
People that have the ability to pay already pay more.
What about the DAP that people pay, or alternately the interest that recieved from the facilities from the RAD?
Also income assessed fees on top of both of these also provide a lucrative income stream above the basic daily care fee.
How much more do they want.
Many of these facilities are getting more than double the basic daily care fee when these other fees are considered.
As someone who’s father was in aged care until Nov last year I just watched as his assets were slowly stripped away by these additional fees.