Many aged care providers are selling additional services but some are charging residents fees for services required under legislation including laundry and wound dressings, according to a new industry report.
The Additional Services Industry Insights Report from aged care consultants Pride Living is based on a 2019 survey of 100 residential facilities across Australia.
It found that 84 per cent of facilities surveyed actively offer and market ad-hoc additional services on a fee-for-service basis and 30 per cent offer additional services via bundled packages.
Popular additional services include entertainment options such as in-room television, Foxtel and Wi-fi, dining services including menu choice and alcohol and extra events and outings.
Additional services aim to enhance the resident experience and caterer to individual preferences while giving providers a revenue source for services not required under the Aged Care Act.
However, the survey found “a concerning number of providers” are charging for services required under the Act such as basic laundry services, special aids and treatments like dressings, and men’s shed programs.
Pride Living partner of financial and operational management James Saunders said around 10 per cent of those surveyed were incorrectly charging additional fees for required services.
“It is a concern,” Mr Saunders told Australian Ageing Agenda.
“The government is behind this [additional services] and we still have providers who say we are going to charge people for dressings,” he said.
“They are advertising on their website that the extra service fee includes laundry. That is provided under the Act. Why would you do that?”
He said it appeared that these providers didn’t understand the legislation.
Bundle offerings increase
Mr Saunders said the standout finding for him was the increase in providers offering bundled packages from about 10 per cent two years ago to 30 per cent today.
“This whole concept is more about consumer directed care.” he said.
“Bundled is what we are recommending” because ad hoc adds “very little to the bottom line.”
Of the 30 facilities offering bundled services, 83 per cent are run by for-profit providers and 17 per cent by not-for-profit organisations.
Fees for bundled services range from $5.00 to $65.00 per day and cost an average of $25.65 a day. Fees at the lower end are targeted towards supported residents, the survey found.
The top additional services include:
- menu choice
- alcohol with meals
- events and outings
- in-room TV
- garment labelling
- premium toiletries
The main reasons that facilities don’t offer additional services at all is because they lack confidence or resources and guidance for creating and implementing a scheme, the report found.
Mr Saunders recommends that providers with nice homes start charging for the additional services they are currently providing for free.
Even low-level fees can offer providers a benefit, he said.
“$6 a day will give you another $2,000 per resident a year,” Mr Saunders said.
“If you have one of those old homes with multi-bed wards and you already have occupancy problems then don’t even worry about additional services,” he said.
“But if you have a brand new home or a refurbished home and you have looked after it, then definitely you should be going down this route.”
Providers should consider making signing up for additional services a condition for living in the home, Mr Saunders said.
He said some not-for-profit providers he knows of make it a condition of admission but offer a subsidised rate for supported residents.
According to My Aged Care, aged care homes can provide information about the additional services they provide including associated costs and whether they are mandatory services that come with living at the home.
Download the report here.
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