Constructing older people as ‘empowered consumers’ risks overlooking the disparity of resources, knowledge and support networks available to help them navigate an increasingly complex care market, writes Dr Beatriz Cardona.
The new funding arrangements for home care packages to start in February 2017, which allocate subsidies to consumers rather than providers, together with the introduction of consumer directed care and income-tested care fees signal a new market-based, consumer-driven community aged care system.
According to the Department of Health, the changes in home care from next year will increase competition, “leading to enhanced quality and innovation in service delivery, and reduced regulation and red tape for providers.”
Directing funding to consumers is expected to create a more responsive and efficient system that will drive up the quality of service provision. Older people will be able to shop around for the best provider to meet their particular needs and change providers if they are not satisfied with the service being delivered.
International experiences with similar models, however, call for some caution regarding the value of more competition. In his analysis of the healthcare system in the US, Professor Michael Porter from Harvard University has pointed out that more competition does not necessarily lead to better outcomes for consumers.
This paradox is explained in relation to the competition to reduce costs, to capture clients and restrict choice rather than in delivering value for consumers. It is often argued that healthcare is different to traditional markets because it is complex; consumers have limited information and because services are highly customised.
Capacity to choose is not equal
The 2015 KPMG evaluation of the home care packages program delivered under the new consumer directed care model concluded that consumer information was key to supporting consumers’ understanding and decision-making with regard to purchasing decisions. This includes information on providers, location, price and any information to support an understanding of the quality and effectiveness of providers’ business and service models. The underlying assumption is that well informed consumers will be able to make choices that meet their needs and drive quality in a competitive market.
But is this confidence in the ability of consumers to drive quality well founded? Are we seeing a shift in power relations from the provider to the consumer? This apparent power given to older people needs to be critically examined.
There is an extensive body of literature in the last 30 years from leading gerontologists exploring the reconfiguration of older people as consumers within a framework of positive ageing cultures. Central to this analysis is the manner in which the dominant definition of positive ageing revolves around the virtues of independence, disposable income, self-care and responsibility. Alongside this is economic reform and a shift from a social and political commitment to care for the elderly to privatised and individualised solutions through personal financial management and consumer choice.
The inherent assumption in an open market where older consumers negotiate their care needs is that older people are autonomous and self-motivated agents with equal capacity to make choices in their lives. This fails to recognise the profound inequalities of gender, ethnicity and socio-economic class that persist throughout old age and more specifically the vulnerabilities of frail and disabled older people who are the main users of home care programs.
Basic market theory tells us that success of markets depends on a balance of competing forces. In successful markets the customer is served and his/her needs met. The customer has the power to determine whether the product or service offered is wanted. The success of the market depends on an informed and effective customer. This is currently not the case in aged care.
The ability of frail older people to make informed choices regarding the best provider and services to meet their needs is in many instances limited. Supported decision-making and assisted decision-making, as argued by the Australian Human Rights Commission, is important for older people who have cognitive impairment or require some form of assistance, for example with collecting information or talking through options.
The idea of supported or assisted decision-making does not only relate to cognitive disability but also to protection of vulnerable people. For example, a physically frail older person may be subject to age stereotyping and/or intimidation and abuse even if they have capacity. A study on consumer vulnerability in financial services in the UK by the Financial Conduct Authority in 2015 highlights that consumers in vulnerable circumstances may be significantly less able to represent their own interests, and more likely to suffer harm than the average consumer.
The home care packages reform and CDC models are informed by positive ageing cultures which shift ageing policy from representations of older people as frail and vulnerable towards independent, engaged and active citizens making choices and negotiating their care. While laudable in theory, this shift serves health economic policy agendas seeking a move from dependence on government towards personal responsibility, alongside a move away from universalism and the welfare state towards provision through the market.
Constructing aged care service users as ‘empowered consumers’ risks overlooking the diversity and disparity of resources, knowledge and support networks available to help them navigate an increasingly complex care market. The evidence so far raises serious questions about the ability of older people to drive quality.
The evaluation of consumer directed care by KPMG in 2012 noted that in selecting participants for the pilot of CDC, service providers considered carer support, level of need, health and cognitive status, educational and professional background as key indicators of suitability for self-managed packages. Among this selected group of participants, there was a preference for providers to retain a significant degree of responsibility for support coordination (particularly where the majority of services were provided by the organisation rather than brokered). The evaluation also showed that most consumers declined the option of self-management of funds preferring greater participation in decision-making regarding service type and delivery options.
For many participants, the decision to use the provider’s in-house services was based on price, as the cost of brokered services was often higher. This was particularly so in areas where there was limited choice and if the CDC provider charged an additional fee for arranging the brokered services.
A more recent evaluation by KPMG conducted in 2015 found that consumers were not making significant changes to their support arrangements when they transitioned to CDC, and new consumers were not accessing substantially different services. The report also highlighted the impact of demographic variables on access and quality of services. Consumers from culturally and linguistically diverse backgrounds (CALD), Indigenous people, and older people from poor socio-economic backgrounds and regional and remote areas faced higher costs, limited choice and culturally inappropriate services, among other barriers.
Driving quality improvement
The proposition that consumers will drive quality and be empowered to make choices that best meet their needs is questionable, at least for the vast majority of users of home care packages who are frail, with few care support networks, limited disposable income to subsidise care, and limited skills and experience in navigating complex age care markets and negotiating services.
This also raises the question: if the quality of community aged care cannot be made the responsibility of its users, what mechanisms can be put in place to ensure older people receive care that enhances their quality of life and wellbeing?
The home care standards focus on quality from a perspective based on a service’s processes and structures rather than a client’s social care outcomes. This is a critical gap that needs to be addressed to ensure aspects of quality of life associated with services are made key outcome measures driving quality. These include the extent to which they help improve users’ health and physical functioning, meet basic physical needs with activities of daily living, guarantee personal safety and security, provide access to social contact, and maximise autonomy, skills, and self-confidence.
As pointed out by Professor Porter in his study of healthcare in the US, the only true measures of quality are the outcomes that matter to consumers. Rather than making quality the responsibility of consumers, we need a rigorous system that monitors outcomes and makes these publicly available so providers face pressure – and strong incentives – to improve and to adopt best practices, with resulting improvements in outcomes.
Dr Beatriz Cardona is research fellow at Macquarie University.
This article appears in the current print edition of Community Care Review magazine.
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