Aged and Community Services Australia (ACSA) has dismissed as “scaremongering” and “grandstanding” the claims from the creator of a new aged care consumer review website that seniors risk being “ripped off” under the new pricing arrangements.

ACSA, the peak body representing not-for-profit aged care providers, condemned the comments from Kenneth Ray, the co-founder of the Aged Care Reviews website, that “operators will naturally raise accommodation deposit levels to just under $550,000” and “families are being asked to sell up the family house.”

Last November the government announced it was increasing the amount of deposit or daily payment equivalent that requires approval by the Aged Care Commissioner from $450,000 to $550,000.

In a media release this morning promoting his new consumer review site, Mr Ray said: “The government has effectively set a new price floor for aged care places. Demand exceeds supply in aged care, so it’s pretty simple to see what will happen. Operators will naturally raise accommodation deposits to just under $550,000.”

Mr Ray said the government had acknowledged there was “information asymmetry” between residents and providers. “That’s a cute way of saying the public – and our most vulnerable – are at risk of being ripped off. But the government has done nothing to address this situation.”

In his release titled ‘Abbott sets $550k aged care price, industry to cash in, families risk being ripped off, Mr Ray said families were “operating in the dark” and his new site aimed to “make sure they get the quality they are being asked to pay for.”

In the vein of Trip Advisor and Urban Spoon, the Aged Care Review site publishes anonymous reviews by consumers and their families of a residential or community care service or provider. People who have inspected facilities can also post reviews.

Responding to Mr Ray’s comments, chief executive of ACSA, Professor John Kelly, said that claims providers will be charging bonds of up to $550,000 and forcing people to sell the family home were “nonsense”.

He said that Mr Ray’s claims the public were at risk of being ripped off were “pure speculation” and appeared to be “grandstanding to win media coverage for his business.”

“It is not helpful to consumers of aged care and their families to have these wild allegations presented as fact,” Professor Kelly said in a statement.

“There are consumer protection provisions in separate legislation and in aged care specific legislation and the government has taken steps to improve the information on the My Aged Care website which is freely available to anyone.”

However Mr Ray defended his comments and denied he was grandstanding.

“One of the potential effects we think is likely is that bonds will rise and as we move to user pays the only way that families will be able to pay for those is by selling their house, that’s their major asset. We think that’s what’s going to happen,” he told Australian Ageing Agenda.

With regard to the consumer protections, Mr Ray argued that the primary consumer protection in the legislation was to set the amount at which the Aged Care Pricing Commissioner had to approve. “We think it’s a bit ridiculous to say that there’s other protections out there when the primary protection is setting the threshold at $550,000, which is quite high.” He added that 90 per cent of bonds were under that amount, according to government figures.

Mr Ray defended other elements of his media release, such as his description of accreditation audits as “notified well in advance.”

When it was put to him that in addition to announced visits, providers received at least one unannounced each year, he said: “I don’t disagree that there are also unannounced visits.”

Despite having said that his site “threatens to expose the dodgy operators” and calling on providers to “stop threatening sites like Aged Care Reviews”, Mr Ray denied his approach was overly negative.

He said the site aimed to promote the majority of providers which were providing quality environments. “I don’t think the focus is always on the dodgy. There is unfortunately in any industry a small proportion who don’t care about quality. We hope to bring transparency to those operators, and give residents and families an outlet to talk about experiences,” he said.

Aged care consumers and their families can register with the site to anonymously review a residential or community care service or provider. People who have inspected facilities can also post reviews.

Mr Ray confirmed providers could respond to reviews.

He said there had been over 40 reviews posted on the site since it was launched last week.

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  1. This is close to my experience ….. My father is a superannuate and both my parents require high care 18 months ago when I inquired about placing them in care the cost was between $500,00 and $800,00 entry fee. Believe me that would have taken every penny they have plus selling the house at the best price. I was also advised of the interest rate that would be applied to the balance until the house was sold and nearly had a heart attack…needless to say we are doing our best to provide care as the alternative is not acceptable…..

  2. Sell the house. It’s just bricks and mortar. Your parents need care and accommodation. They’ve worked all their lives to build resources to meet their needs and now that they need it, you’re saying they can’t have it? Bonds or RADS are refundable so you won’t lose your inheritance. Remember the three G’s of aged care … GUILT at having to make the decision that is actually in their best interests, GRIEF at losing part of a person who is so dear to you and been a huge part of your whole life. … and then the biggie … GREED at the thought of how much it costs. Stop being selfish. Get your parents the care they need.

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