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Federal Treasurer Jim Chalmers during Question Time at Parliament House in Canberra. Picture: NCA NewsWire/Martin Ollman

Budget 2024: $2.2bn invested into aged care

The 2024-25 Federal Budget was revealed by Treasurer Jim Chalmers on Tuesday night, with aged care cited as a funding 'winner'.

Mr Chalmers has called the Budget as one for "a better, stronger aged care", announcing $2.2bn to be invested.

"As more Australians live longer, healthier lives, demand for aged care services is growing – and the sort of care we need is changing," Mr Chalmers said on Tuesday night.

"We will invest another $2.2[bn] in aged care and implement more of the Royal Commission.

"Including $1.2[bn] to improve systems so our aged care services remain accessible, up-to-date and reliable."

Since the October 2022-23 Budget, total investment in aged care has increased by 30 per cent.

Here is the breakdown of what's being invested in and for the sector.

Home Care Packages

Half a billion is being invested into additional home care packages (HCP) as part of the Royal Commission recommendations.

One of the highlights of Budget night was an investment of $531.4m for an additional 24,100 HCP places, allowing for "more choice" for older Australians.

"Ensuring dignity and security for older Australians means allowing people to choose the care that’s right for them – including staying in their own home," Mr Chalmers said.

The Department of Health and Aged Care reported that 277,564 people had access to HCP – a 13 per cent increase from the year before.

Chief of Uniting NSW/ACT Tracey Burton welcomed the additional HCP places but said it was not a "long-term investment".

"[Uniting} would've liked to have seen enough packages released [so] that the current waiting list might've been addressed," Ms Burton told Aged Care Insite.

"We need at least double what they released ... at the end of last year, nearly 52,000 people were waiting for their approved level.  

"These additional packages will halve the number on the waitlist, but [it] will still be six months long – and it will mean those who receive a home care package will not be funded according to their need; they will start with a lower care package and go onto a waitlist for one that meets their need."

Older Australians in hospital

A growing number of hospital beds across Australia are occupied by patients waiting to be transferred to aged care.

To help "take pressure off hospitals", states and territories will get $610m to address long-stay older patients, including through funding to provide outreach in the community and deliver virtual care to alleviate the need for hospitalisation in the first place.

The Australian Medical Association report card said hospitals were at "breaking point", with the AMA president Professor Steve Robson saying maximum wards, a depleting workforce, and inadequate disability and aged care support contributed to overcrowding.

Funding for this was announced last year, with Mr Robson stating it was welcome, but they needed more now.

"This funding was originally announced late last year by National Cabinet," Mr Robson told Aged Care Insite.

"The AMA welcomed the Government’s commitment at the time, and we remain supportive of the investment. 

"What we need to see now is states and territories to use this funding to engage their GPs to help older Australians avoid hospital admission and support early discharge from hospital."

Dementia patients transitioning from hospital into aged care have also secured $57m.

Dementia Australia executive director Dr Kaele Stokes said the Budget was an important step in improving the quality of care for people with dementia, their families, and carers.

"We welcome the continuing progress made by the Albanese Government in keeping dementia at the forefront by addressing key recommendations of the Royal Commission into Aged Care Quality and Safety," Ms Stokes said.

"Given there are more than 421,000 people living with all forms of dementia in Australia, we are committed to continuing to work with the Government to ensure the experiences of people impacted by dementia remain central to the design and roll-out of these and future aged care reforms."

More than 400,000 Australians live with dementia, with 70 per cent of aged-care residents living with moderate to severe cognitive impairments, including dementia.

That number is estimated to jump to 900,000 in the next 25 years, with the recent Intergenerational Report estimating Australia's older population to triple.

New data by Dementia Australia estimates 812,500 by 2054 if there is no medical breakthrough.

The Budget also announced $25m for specialist palliative care to be delivered in care rather than hospitals; $10.8m over two years will extend the Palliative Aged Care Outcomes Program and the Program of Experience in the Palliative Approach.

However, Palliative Care Australia (PCA) chief Camilla Rowland criticised the government for not taking the opportunity for a deeper change, especially as their Budget Submission targeted "meaningful" change for older Australians.

"Our role is to point out where as a country we need to do better for some of our most vulnerable people and families," Ms Rowland said. 

"It’s heartbreaking to realise that this week’s Budget does little to support the urgent needs of people under 65 with a life-limiting illness who need basic care and support at home during their last months and weeks. 

“These are people with a range of terminal illnesses and disabilities who end up in hospital or in emergency departments simply because the day-to-day living supports they need to stay at home are beyond reach."

Aged care regulator

The Aged Care Quality and Safety Commission (ACQSC), will receive $111m to enhance their capability.

In a joint statement, Aged Care Minister Anika Wells and Health Minister Mark Butler said the funding would enhance the capability of ACQSC and was in response to the Independent Capability Review – a review by the Department of Health and Aged Care that assessed if the regulator had the resources, workforce, and skills to operate.

The $111m would also help the ACQSC implement the regulatory framework that would underpin the new Aged Care Act, scheduled for July 1 2025.

The funding comes after it was announced in April that the ACQSC would increase their audits for home care following a report that found that one in every three home care services failed to comply with all eight standards.

"We are concerned about this and will be increasing the number of quality audits we do in 2023–24 and in 2024–25," the report said.

"We will also be increasing our education to the sector, building on five key risks in-home care and sector guidance on price capping regulation."

Older Persons Advocacy Network (OPAN) chief Craig Gear welcomed the boost but said there was "not enough to reform aged care".

"The boost of funding for the Commission will enhance its capability as a regulator, but there needs to be independent oversight and handling of complaints," Mr Gear said.

"Our concern is that the delayed Aged Care Act also delays the enforcement of older people’s rights in aged care and restorative justice when issues occur."

Aged care technology

In one of the biggest investments for the aged care sector, the Budget has allocated $1.4bn to upgrade technology systems and digital infrastructures.

The Budget allocation includes $1.2bn over five years to continue funding current systems and to support the implementation of the upcoming Act.

A further $175m will be distributed over two years for ICT for the new Support at Home Program and Single Assessment System.

Reinforcing and retaining the workforce

Sighs of relief were heard across the sector after the Budget included $88.4m to attract and retain the sector's workforce.

A joint statement from Ms Wells and Mr Butler said the final award wages decision was anticipated around mid-year.

"Last year, we invested $11.3 billion to deliver fairer wages for aged care workers in support of the Fair Work Commission’s 15 per cent wage increase decision," the statement read.

"In March this year, the Fair Work Commission made a further work value decision to increase award wages for many aged care workers."

The Albanese government expressed concern over the recent lump-sum increase, saying it may cause labour shortages in other healthcare sectors.

A submission to the Fair Work Commission outlined that hospital nurses might jump to aged care to increase their pay, and the wage hikes should be split into two.

Tom Symondson, chief of the Aged and Community Care Providers Association (ACCPA), welcomed the investment.

"ACCPA welcomes the Government’s commitment in the budget to fully fund wage rises arising from Stage Three of the Work Value Case, giving valued workers increases of between three per cent and 14 per cent," he said.

"We look forward to more details on the funding, once the final decision is made by the Fair Work Commission later in the year."

My Symondson said the increases were vital in keeping the workforce and sector moving.

"We know that the previous increases are working.

"We’re hearing reports from across the sector that it’s becoming easier to attract and keep aged care workers, so this is another important step in that journey."

More urgent care clinics to open up

Before they got elected, one of Labor's promises was to "roll out 50 GP-led enhanced Medicare Urgent Care Clinics (UCC)" to help take pressure off hospital EDs.

With the successful opening of 58 UCCs across Australia, Mr Chalmers allocated $227m for a further 29 to open up.

"Since June last year, almost 400,000 visits have been made to our 58 Clinics in suburbs and regions all over Australia," Mr Chalmers said on Tuesday night.

"And because these clinics open early and close late, more than one in three visits were outside normal working hours, taking pressure off emergency departments and making it easier for Australians to access free healthcare."

Early data published by the Queensland State Government found that in areas where UCCs had opened, non-urgent and semi-urgent presentations in the ED were down.

Logan Hospital was down by 10 per cent, and Ipswich 25 per cent.

However, the clinics have created controversy among GPs, labelling them a "PR stunt" and nothing more than a "band-aid".

Royal Australian College of General Practitioners president Dr Nicole Higgins said the investment into UCCs was "misguided".

"There is no substitute for personalised quality care delivered by a GP who knows you and your history," Dr Higgins said.

"Every year, more than 22 million Australians choose to see a GP for essential healthcare. They deserve an affordable system. 

“Instead, the Government has chosen to continue its misguided policy of rolling out what it calls urgent care clinics."

Cheaper medicines and quality care

As part of the $1.2bn Strengthening Medicare package, $882.2m will be used to ensure older Australians get the support they need through upskilling the workforce, delivering hospital outreach services in the community, providing virtual care services, and delivering complex care for older people outside of the hospital.

A further $190m will help older Australians recover from a hospital stay with short-term care through the extended Transition Care Programme.

In an effort to keep Medicare "stronger" and medicine "cheaper", the budget has funded $318m to freeze the cost of prescriptions through the PBS over five years – with pensioners and concession card holders paying $7.70.

In 2022-23, over 60 per cent of total PBS expenditure was towards older Australians, while through 2023, close to 240,000 older Australians in residential aged care received more than 10.7 million PBS-subsidised prescriptions.

$900,000 will also be invested in aged care to provide residents with free vaccines through community pharmacists.

Outcry over "missed opportunities"

Although the announcement of investments has been welcomed, peak bodies have criticised the Budget, saying it was a "missed opportunity" to address the Taskforce recommendations and the upcoming Act.

Catholic Health Australia (CHA), the peak body representing 350 Catholic not-for-profit aged care facilities, said the decision to delay essential sector reforms threatens access to quality and dignified care.

Director of aged care policy at CHA Laura Haylen said the government had failed to implement the recommendations of the Taskforce.

"It’s been six months since the Aged Care Taskforce delivered its recommendations and the
government has not even responded to them," said Ms Haylen.

"The decision to neglect the Aged Care Taskforce recommendations in this budget is incredibly
disappointing and frustrating.

"With most facilities operating at a loss, and many at risk of closure, we are running out of time to
secure quality and sustainable aged care for our loved ones."

Whiddon's chief Chris Mamarelis called the Budget "extremely disappointing" as the needs for older Australians had been overlooked.

"The Government has stated strongly that it is pursuing a reform agenda aimed at the long-term future of aged care, yet ironically, funding is continually placed in the too hard basket," Mr Mamarelis told Aged Care Insite.

"Why did the Government commission and chair the Taskforce if they are not prepared to act on
their recommendations?

"The Taskforce conceded that the industry was not positioned to support the growing needs of the
population over the coming years, yet this budget shows an absolute lack of urgency in addressing
this priority."

Mr Mamarelis has continually advocated for rural, regional and remote providers, especially as Whiddon has many in non-urban locations.

Yet, despite 21 per cent of residential aged cares and 25 per cent of home cares being in these areas, funding for the region's aged care and health was absent from the Budget.

"The only commitment in the budget for the regions was $7.8m over two years to transition to the AN-ACC funding model," he said.

"This budget was an opportunity for the Government to look after our regions by changing the funding mechanism for regional and remote communities.

"Our regions need more strategic support, such as tax incentives to attract workers to these locations and investment incentives to promote the renewal and expansion of our regional aged care services," he said.

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