Deadline looms for home care agreement reviews

Home care providers who don’t review their clients’ agreements in line with new transparency requirements by the end of this month could find themselves in hot water.

The government last year introduced new rules requiring home care providers to publish pricing schedules and price lists on My Aged Care, charge all new clients those fees and provide them with a pricing list.

The new rules also required prices to factor in reasonable administration costs including office rent, insurance and marketing, which could no longer be charged separately.

New requirements for existing clients

From July, the same requirements will apply to clients who were receiving  services before last July.

Providers will have to review their agreement with these clients in line with the published pricing schedule and include a copy.

“If you do not meet these requirements the Department of Health may take compliance action,” the government warns.

In reviewing agreements, provider are obliged to provide adequate information and make sure clients understand how the changes will impact on them.

However, providers will not be able to make the changes without the agreement of clients but will have to negotiate an agreement that suits both parties, the department says.

LASA CEO Sean Rooney warns that the Aged Care Quality and Safety Commission has been monitoring providers and has informed the peak that some are not meeting full pricing transparency rules.

 “The Aged Care Quality and Safety Commission audits of home care providers indicate they are asking for client financial statements and reviewing financial governance arrangements,” said Mr Rooney.

A new pricing tool

LASA has developed a home care pricing tool developed with consultants O’Connell Advisory which it says will help providers meet the new requirements, understand their own costs and give them an edge in the growing market.

Mr Rooney says unit pricing can be complicated, taking in factors like  variable costs, service volumes, economies of scale and use of subcontractors.

“This unique tool has been designed to empower home care providers to understand their costs,” Mr Rooney said.

“Setting accurate prices to deliver quality, competitive services is a key strategy that can define business success.

“It offers a solid foundation for pricing and will simplify the new requirements to review pricing schedules annually and keep information up to date.”

Complying with a new regime

Mr Rooney says the tool is consistent with the legal requirements and specified care and services under the new transperancy regime.

It also includes the current HCP subsidy and monthly and annual data sheets plus yearly forcasting.

“As a planning tool it can help set KPIs for client numbers, profitability, care hours and expenditure on services,” he says.

Legislation to move to payment in arrears for Home Care Packages has been put on hold because of COVID 19, but Mr Rooney says they pricing tool will also help providers assess the impact of this when it comes into force.

 For information about the Home Care Package Pricing Tool contact members@lasa.asn.au or 1300 111 636.

This story first ran in Community Care Review.

Comment on the story below. Follow Australian Ageing Agenda on Facebook, Twitter and LinkedIn, sign up to our twice-weekly newsletter and subscribe to AAA magazine for the complete aged care picture.