The changes to claw back aged care funding announced in last week’s budget are far more than the government predicted, and if they go ahead, will impact sector viability and result in exclusion of high-needs residents and inadequate treatment for symptoms of suffering such as pain, according to new analysis by Ansell Strategic.
Following cuts to Aged Care Funding Instrument (ACFI) announced in December’s Mid-Year Economic and Fiscal Outlook (MYEFO), the Federal Government announced in the budget that it would be making further changes to ACFI to save $1.2 billion over the next four years to stabilise what it described as a continuation in higher than expected growth.
The Government said the growth in ACFI was driven by higher than anticipated claims in the ‘complex health care’ (CHC) domain and that it was changing to certain areas of that domain and reducing indexation levels.
- What do the changes to the CHC look like? See a summary bottom
Ansell Strategic’s analysis, which was commissioned by Leading Age Services Australia (LASA), has found that the proposed changes to ACFI would equate to cuts $350 million in excess of those announced by Government in the budget and MYEFO.
“Our analysis indicates that funding claw backs to providers will be in excess of $2 billion over the next four years alone. As the proposed changes are permanent, there will be long term ramifications for the most vulnerable residents and the providers that care for them,” the report said.
The analysis found that from January 2017, the average 80-bed facility would lose about $439,000 per year, less than 13 per cent of residents would be classified as having high complex health needs compared to the 44 per cent currently, and the average daily funding for the care of CHC needs would fall from the current $45.84 to $30.80 for residents entering care after the proposed changes are implemented.
Ansell Strategic managing director Cam Ansell said the analysis highlighted major concerns that required urgent attention.
“While the cuts compromise the viability of the sector, the threats to the vulnerable aged are even more concerning. The ACFI changes create a disincentive to admit high dependency people and will ultimately result in their displacement to hospitals,” Mr Ansell said in the report.
“We believe that it is critical that the aged care and broader healthcare sector work collaboratively with Government to ensure that these changes do not proceed.”
LASA spokesperson Beth Cameron said: “We are appalled that the government and department have downplayed the total amount they are ripping from aged care services through changes to ACFI.”
These changes will affect providers and the people whose high care needs are being reclassified, she said.
“Downgrading a person’s care score will not actually change their personal health care needs. If someone needs two injections and five tablets at certain times of the day, that is what they need and that is what aged care providers will still have to ensure they can deliver,” she said.
Ms Cameron said it was extremely disappointing the changes were determined without adequate engagement with industry, including the peaks.
“We will continue to demonstrate to both the Government and Department that these changes are unsustainable and do not reflect the increasingly complex care needs of older Australians or the true costs of care,” Ms Cameron told Australia Ageing Agenda.
Similarly, fellow peak Aged and Community Services Australia (ACSA) reported in its National Report yesterday that it had growing concerns about the impact the ACFI changes announced in the budget would have on funding.
“We are getting modelling on this to confirm our concerns and have requested an urgent meeting with the Department. We will get back to members as soon as possible,” ACSA said.
Proposed CHC reductions
The Government’s proposed changes are in two parts and, as set out in the fact sheets accompanying the budget announcement, involve the following:
The first, effective 1 July 2016, would see indexation of funding in the Complex Health Care (CHC) domain of the ACFI halved for one year, returning to 100 per cent from 2017–18.
Further, for new appraisals or reappraisals from 1 July to 31 December 2016, the scoring of certain medication and complex health care question combinations in the CHC matrix will be reduced.
As per the figure below, the DC combination reduces from high to medium and AC from medium to low. The current dollar value of each domain level per resident per day is ranges from $16.25 (low) to $46.27 (medium) and $66.82 (high).
In the second part, effective 1 January 2017, a redesigned scoring matrix (below) that reduces the rating categories for medications from four to three rating points and changes to scoring for some CHC procedures will replace the above for new appraisals or reappraisals of existing residents.
“If assistance is needed with medication this will now in all cases receive the middle B rating, rather than the previous matrix which provided an incentive to take longer to deliver medication by allocating the highest level of funding where medication assistance was required for more than 11 minutes per day,” according to the fact sheet.
As part of calculating the overall complex health care score, items affected by the changes include:
- blood pressure measurement will be reduced from 3 points to 1
- complex pain management at least weekly and for 20 minutes will be reduced from 3 points to 2
- complex pain management by allied health professional at least 4 times per week will be reduced from 6 points to 4 and 120 minutes of delivery of treatment over a week will be required
- management of arthritic joints and arthritic oedema involving the application of tubular elasticised support bandages will be reduced from 3 points to 1
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