For-profit aged care services have a higher rate of regulatory failure, according to new research that found private providers were more than twice as likely as not-for-profits to have government sanctions imposed on them over a 13-year period.
The new research will likely spark fresh debate about the link between facility ownership and quality standards. While NFPs currently account for approximately 60 per cent of the residential aged care sector, private operators are the fastest growing segment.
According to the analysis by University of Technology Sydney doctoral candidate and registered nurse Richard Baldwin, ownership type, jurisdiction and service location were significant predictors for sanctions.
Services in remote locations were nine times more likely to have sanctions imposed than services in major cities. Across Australia, NSW had the lowest rate of sanctions and the Northern Territory the highest.
The study is based on a statistical analysis of accreditation data since the system of accreditation and sanctions was introduced in 1999.
Mr Baldwin’s analysis supports the findings of previous local and international research. The higher rate of sanctions in for-profit services was first identified by Australian gerontologist Anna Howe and Dr Julie Ellis in 2010.
Mr Baldwin, from the university’s faculty of nursing, midwifery and health, said he hoped the research would contribute to a robust debate on quality within the sector and help focus government’s regulatory efforts to maintain or improve quality in aged care.
“The international literature is quite clear about the fact that not-for-profit services provide better quality care than for-profits,” he told Australian Ageing Agenda. “However, there is very little debate about that in Australia, virtually no debate.
“Everybody thinks services are all the same and I think this research indicates that they are not the same.”
Given the link between provider characteristics and the likelihood of sanctions, Mr Baldwin said the Australian Government should take factors such as ownership into account when planning future services.
In particular, he said the government should carefully consider the impact of a potential move to full market deregulation. He added:
“If the government was to reduce the controls on supply in the way it has been recommended by the Productivity Commission, the government should give serious consideration to the impact that that might have on the quality of services”.
Different patterns of aged care ownership between NSW and Victoria could explain why Victoria experienced a significantly higher rate of sanctions, the analysis said.
NSW has a very large NFP sector, which in 2011 delivered 68 per cent of all residential aged care services. Only 28 per cent of services were operated by for-profit services and 4 per cent by government services.
Victoria, by comparison, has 40 per cent of all residential aged care services delivered by for-profit providers, 25 per cent by state and local governments and 36 per cent by not-for-profit organisations.
Facilities operating in Victoria, Queensland, South Australia, Northern Territory and Australian Capital Territory were more likely to have sanctions imposed, according to the findings.
While adding to the small volume of research in this area, Mr Baldwin said the study could not explain why for-profit organisations experienced more sanctions and it did not examine the quality of the care delivered by providers that passed accreditation.
He said other factors such as staffing levels, staffing qualifications, provider size, resident characteristics and income have also been associated with regulatory failure and were worthy of further investigation.
The study was published in the Australasian Journal on Ageing.