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Calls for more transparency around new funding model


The classification method used in the proposed residential aged care funding model is complex and poor-performing and alternative modelling should be explored, the consultation on the new model hears.

Dr Richard Cumpston, a consulting actuary and director of Australian Projections, says the data collected by the Resource Utilisation and Classification Study should be released for independent analysis and a consultant with strong expertise in data algorithms should be engaged.

The findings of the government-commissioned RUCS undertaken by the University of Wollongong’s Australian Health Services Research Institute were published in a suite of reports released on 15 March (read more here).

The consultation on the findings including the proposed new funding model Australian National Aged Care Classification (AN-ACC), which consists of 13 classes based on end-of-life needs, frailty, functional status, cognition, behaviour and technical nursing needs, closed last Friday.

Richard Cumpston

Dr Cumpston has raised several concerns to the consultation including the poor statistical performance of the model and the unknown reliability of the functional assessments made by nurses in the trials.

“Substantial measurement errors would have degraded the statistical performance of the model,” Dr Cumpston told Australian Ageing Agenda.

He is also concerned about the statistical method used by the university.

“While casemix classifications have a long history of use for government payments to hospitals, they may not be the best method for a residential care funding model.

“Trials should be made with a variety of the methods now available, using expert advice,” he said.

Dr Cumpston is calling for the data collected and the classification algorithms used to be made public.

“The details of the university’s classification algorithms have not been released, preventing providers from estimating likely payments for their own residents.

“The algorithms, as well as the data used to derive them, should be public,” he said.

Dr Cumpston recommended assessments in the ongoing trials be checked by independent assessors and only items with high reliability used and unreliable and overlapping assessments eliminated to reduce the risks of legal challenges.

Providers call for transparency

The consultation has received 83 submissions to date and more are expected this week as some organisations requested an extension, a Department of Health spokesperson for RUCS told AAA on Wednesday.

Provider peak Leading Age Services Australia is among those that have already made a submission, which was informed by consultation with members.

While welcoming the AN-ACC funding model as an opportunity to address major deficiencies in current residential funding arrangements, LASA also called for the release of methodology behind the proposal.

“The Research Utilisation and Classification Study (RUCS) reports do not provide enough detail to fully assess or replicate its analyses, for example the formula for compounding factors is described as a statistical model, but the model is not disclosed.

“The full research methodology needs to be reported in line with what would be expected in an academic publication. The detail provided should be sufficient to allow for replication so providers can fully assess the proposed model,” LASA wrote in its submission.

LASA also raised concerns over the financial impact of the proposal, the AN-ACC model and the reform process and said some providers would be significantly worse off if the overall funding pool was not increased.

Among key concerns, LASA said providers were unable to assess the likely financial impact of the changes on their facilities because key information was not disclosed.

“The Government needs to set out options for the initial value of the National Weighted Activity Unit and the algorithm that actually maps assessment scores to classifications,” it said.

LASA described the AN-ACC resident classification as simple, apparently more accurate than the Aged Care Funding Instrument and easy for providers to determine a resident’s eligibility for a higher classification.

However, it said “the AN-ACC needs to include an independently mobile class for residents with dementia and the algorithm for assigning residents to particular classes needs to be disclosed.”

LASA said it supported the government’s plans to test and refine the proposed AN-ACC model but said “providers need to be involved in the design of the pilot study to resolve outstanding questions” and “it needs to be very broad and not just an east coast closed shop.”

Aged & Community Services Australia, which is still preparing its submission in consultation with its members, also highlighted the lack of detail with the proposal and funding.

ACSA CEO Patricia Sparrow said there were some good features in the proposed new model and in particular recognition of the additional cost of delivering speciality services and aged care and in regional, rural and remote locations.

Pat Sparrow

“But it won’t matter what the funding model is if there is inadequate resources to support the quality of care providers want to deliver,” Ms Sparrow told AAA.

“Analysing and fully responding to the model is difficult as there is no pricing information available which leaves a critical piece of the puzzle unaddressed.”

Ms Sparrow said testing the proposed model and understanding its impacts across the entire system including if it appropriately supported the social needs, wellbeing and quality of life of older Australians was critical.

She said ACSA’s key concern was about what the level of funding would be.

ACSA’s key recommendations include:

  • the upcoming trial must engage the sector as it assesses the AN-ACC funding model
  • that findings and recommendations of the upcoming trial are transparent and shared with the sector for analysis and consideration
  • that alternate funding model options are on the table if the proposed AN-ACC model is shown to have significant flaws or results in losses of funding for a significant number of providers.

Access LASA’s submission here.

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2 Responses to Calls for more transparency around new funding model

  1. antia June 7, 2019 at 12:20 pm #

    This sort of article leaves me in despair: why don’t we spend the next few years forensically interrogating and arguing over the detail of the work of independent academics (who have no vested interests in the sector)? In the meantime, government is let off the hook from implementing strategic reform because the sector can’t agree on all the details!

  2. Anonymous July 2, 2019 at 3:37 pm #

    Well having worked in this sector I feel this will be a step in the right direction. Time and time again facilities “fluff” their assessments to get maximum funding for residents (even if they do not actually meet criteria) just to get the higher rate per day ($$). This is what giving the facility control of assessments does. Then pocket this money- try actually getting something identified as a need for the resident who has been assessed!! This is what is needed to ensure residents get care they need. ACFI promotes disablement due to $, there is no incentive for reablement due to fear of losing the payments the facility receive… if facilities have completed assessments accurately, they should not be concerned about significant loss of money as it should be fairly equal if transferred to the new AN-ACC model!! Just a thought!

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