A draft report from the Productivity Commission has vindicated providers, saying that aged care regulation is too burdensome and costly.

It called for an overhaul of aged care policy to loosen centralised control and encourage greater competition.

“Without tackling the policy framework it is unlikely that the regulatory burden on aged care providers can be substantially reduced,” the report warned.

The commission also criticised some of the 'tough measures' introduced by current Ageing Minister, Justine Elliot.

It questioned the effectiveness of recent announcements such as the ‘strengthened’ police check requirements and the imposed obligation to report all missing residents.

Such measures were implemented without properly considering their cost impact and unintended consequences, according to the report.

It also said there was insufficient evidence to demonstrate that these new requirements had benefited residents.

“Meeting regulatory requirements can come at the expense of providing better care as staff are directed to paperwork – a perverse outcome in a regulatory system that is designed to improve the quality of care,” said the report.

The commission recommended that the Department of Health and Ageing conduct a public evaluation of the police-check requirements to “explore whether the benefits of the existing regime could be achieved in a less costly manner.”

It also wants the existing target of an annual unannounced visit for every aged care home in the country to be abolished.

Instead the commission would like to see a redesigned visiting scheme which focuses on underperforming homes.

Another area of aged care overregulation targeted in the report was the duplication around fire safety and building certification.

Aged and Community Services Australia (ACSA) CEO, Greg Mundy welcomed the report, saying that excessive regulation had been hampering the industry for some time.

“The human and financial costs of red tape are unnecessary, unreasonable and unsustainable,” said Mr Mundy.

“The commission’s draft report reinforces our concerns that the excessive duplication of regulatory requirements from all levels of government impact on service delivery.

“The report acknowledges the extensive list of compliance measures demanded of aged care facilities.”

Click here to see the full draft report.