More details please: expert PC Panel

Some great ideas, some interesting thoughts but a bit more detail in a few areas would help, says expert PC panel.

While responses to the Productivity Commission’s long awaited draft report last week, have been predominantly positive, the coming four months will be crucial as stakeholders discuss and debate details and work to inform the PC’s final recommendations.

AAA invited a cross section of aged care industry leaders and stakeholder representatives to form a panel to provide commentary and help to influence the direction of these discussions.

We asked them a range of questions.  Among them, we asked what areas of the draft report they felt needed more development and clarification..

Here is some of what they had to say in response to the question: What areas or ideas need further development or discussion?

For further development: delivering on consumer choice, one stop shops sound good but rarely deliver. How will the new agency ensure the achievement of transparency? The impact of the changed asset test arrangements. The operation of the Government’s reverse mortgage scheme.”
Michael O’Neil, CEO National Seniors

Further discussion is needed on what the changes will mean in practical terms for providers in the next two to five years.”  
Barbara Squires, General Manager – Ageing, Benevolent Society

The principal deficiency we identify in the report – and one that wasn’t really addressed through the terms of reference – is the whole issue of seniors housing and accommodating an ageing population. It remains MHL’s position that the most critical challenge for the Australian community is to ensure we are all appropriately housed – and this needs to extend beyond just the layout of the built form. We need to address the whole functioning of the community including matters such as transport.”
Doug Strain, Chief Executive Officer, Masonic Homes Limited 

“…abolition of the ACAR process and how residential places and community packages will be allocated.  How will areas of need be identified by the Government?  How will the effects on supply and demand be monitored if the numbers of places and packages to be given out are unlimited? In recent ACARs, there were advised by DoHA to be up to ten applications per one available home-care place. If all desired CACP and EACH and EACHD places sought were to be made available, an extraordinary growth in government outlays may occur as informal carers (such as spouses and children) may be replaced/augmented at a much faster rate. This could also result in many unexpected outcomes. (eg. short-term major reductions in residential care occupancy rates.). 

“The introduction of a “capped” bond system and the effects on providers in their ability to be financially viable services and develop new services etc. 

“The proposed funding mechanism appears based on the concept that providing care services has the same cost regardless of whether that care is delivered in a four-bed ward service or a new single-room, ensuited service. All surveys have demonstrated that this is not the case: it costs more to deliver care in single, ensuited rooms.

“The draft report cites the AHURI SIH report, dated Jan 2010, and SIH in general as a key component of the aged care system; however the draft report fails to tie in the need for and growth in SIH with the policy objectives and recommendations. There were more EACH’s and EACH(D)’s approved in the last ACAR than there were new High Care places. The continuing huge expansion in EACH’s and EACH(D)’s must give rise to an SIH sector with increasingly high numbers of ‘nursing-home type persons’ accommodated. To leave this SIH sector to very segmented state government (or no) regulation appears inadequate unless some clear regulatory control of EACH outcomes themselves is recommended.”
James Underwood, Director, Underwood & Associates

There is lack of clarity and overlap with some aspects of Disability; Health; HACC , and carers. Significantly, costings for most suggested reforms are in principle and ball park figures rather than specific and formulaic. The development of costings for priority reforms need further discussion through elaboration and exploration.

“For older people from diverse cultural and linguistic backgrounds the report targets several priority issues but does not explore them as specific reforms, for example: How will the report and information about the reforms be provided to older people from diverse cultural and linguistic backgrounds? How will they provide feedback and responses? How will they access the Gateway? […]How will interpreters be used? […]

How will service providers receive information and training on culturally competent service delivery? Who will fund the training? Who will provide the training?”
Rosa Colanero, Chief Executive Officer, Multicultural Aged Care Inc 

The proposal for co-contributions for some services is both brave and commendable. There needs to be a well-developed communication and information strategy if the general community is to come to the view that residential aged care services could be more expensive for families in the future.”
Professor Tracey McDonald, RSL LifeCare Chair of Ageing (Faculty of Health Sciences), Australian Catholic University 

More detail is needed regarding how the model for improved access to community based care and support will work (in comparison to RAC).  [And] there is not enough focus on how to attract /retain workforce.

“[We also need] detail on how the reforms will interface and/or be strengthened by other current government reform initiatives. [Finally],how we will transition from the existing model to the new and link with the health and hospital reforms.
Dale Cleaver, CEO, Royal District Nursing Service SA

The whole notion of what is a ‘competitive wage’ needs to be discussed and reviewed. This conversation also needs to go beyond simply asking that providers pay ‘competitive wages’. In asking the appropriate wage levels for workers, the proposed Australian Aged Care Regulation Commission needs to look beyond the health and community services sector for a comparison on wage levels. Whilst a Certificate III trained aged care worker can expect to earn on average $18 an hour, their similarly trained counterparts in the manufacturing industries are paid more than $30 an hour. The enquiry, and the sector as a whole, needs to look at what can be done to improve this and help retain and attract people to aged care. The aged care workforce will provide the foundation for a quality, patient focused, care driven sector and paying a fair wage to do so needs urgent action.”
Sue Lines, Assistant National Secretary, LHMU (Liquor, Hospitality and Miscellaneous Union)

We might have to do some tweaking to make sure care and accommodation can be delivered equally in homes and in residential facilities in all areas and for all groups.  

“I’d also like to understand under recommendation 1.7, why the average cost of providing residential care accommodation for supported residents is based on a two-bed room?  A high level principle says those who can afford to pay should, but they need to strengthen the way they have written about the way others have been protected.  Nothing in the report implies a two tiered system…so how did they strike the two-bed room as a basis?
Gerard Mansour, CEO Aged and Community Care Victoria (ACCV)

Although the report acknowledges dementia as a key driver of demand for aged care, there is no specific action recommended on dementia or dementia specific care.  There are also gaps in the report in terms of psycho-geriatric care and links with the mental health system.  The final report will need to make a more detailed recommendation on a new funding model which should include additional funding for the extra requirements of caring for a person with dementia. There is also a need to further develop recommendations around workforce issues.”
Glenn Rees, CEO, Alzheimer’s Australia

If aged care residents are to receive quality care then they must have the right mix of skilled staff to give that care. A high percentage of elderly Australians have complex health needs and need hospital level care. The average national care time per resident per day from a registered nurse is just 22 minutes. Nurses in aged care also receive as much as $300 less a week than nurses in other sectors and assistants in nursing get an appalling $15 per hour. This makes attracting nurses to aged care very difficult.
Lee Thomas, Federal Secretary, Australian Nursing Federation (ANF)

Nearly all of the key recommendations are high level and need a great deal of work to add the necessary details to implement them. The creation of the Australian Seniors Gateway Agency and the Australian Aged Care Regulation Commission are examples of this. While some details are given around composition and functions, questions such as ‘How are these bodies to be established?’  ‘Who will be involved?’ ‘How will they co-ordinate with the bodies to be established under the National Health Care Reforms such as one-stop shops and Medicare Locals?’ need to be addressed. 

“Details on the recommendations regarding private funding of aged care are lacking and this area is probably the most controversial. For example how are the equity release scheme and the Australian Pensioners Bond scheme to operate? The report was not in favour of a pre-funded insurance scheme, as has been recommended for the disability sector, however it is an issue that may require further debate, as there may be some public opposition to the pay-as-you-go tax financed system supplemented by higher co-payments and a stop-loss mechanism. 

“The concept of increasing consumer control and choice is strongly supported, however more thought needs to be given to what this means for people who are not in a position to make these choices or assume financial control or who may not wish to do this. It is pleasing to see the issue of paying competitive salaries for nurses and other care staff being supported, but the recommendation that care prices take into account the extra costs for these salary payments is very light on details and it is not clear how this would work in practice.”
Sandra Hills, CEO, Benetas

As the report acknowledges, the ‘Gateways’ concept needs further development as do the transition arrangements (risk management); fees for community care (need to take account of other living costs) and ‘pensioner bonds’ (advantages of Government v commercial models). Establishing ‘equivalence’ between bonds and charges will require the development of rules/standards
Greg Mundy, aged care commentator

The discussion about accommodation bonds and the new Australian Pensioner Bond system needs further intensive community consultation.  There has been in my view too great a level of discussion (again) on the relative merit of accommodation bonds and the need to sell the family home.  Accommodation bonds are perhaps part of the solution to this vexing matter of cost of capital, but it is only one answer or response.  How do hospitals manage their capital costs?  No accommodation bonds there.  Is part of the daily cost of care used to support the cost of capital?  I am not sure but we should find out.  What about rental fees, lease fees, or some form of time-share arrangement?

A single choice response to such a complex and expensive requirement as the cost of capital for the accommodation in which residential aged care is provided is not the best outcome.”
Wayne Belcher, former CEO, The Bethanie Group, WA

The cost of care and accommodation [..] and how it is calculated. The principles and assumptions that underpin this are critical. The National Health and Hospital Reforms have moved to an evidence-based system for doing this (case mix) and an independent National Hospitals Pricing Authority has been formed to do this. Given what the Productivity Commission has said about achieving parity in the wages paid to health and aged care workers and also recognising that in the future, aged care providers will be providing highly specialised clinical services, it is difficult to understand why consideration has not been given to leveraging on these mechanisms that have already been established in health.

“…development of the workforce […] requires more practical consideration. […] Again, under the National Health and Hospital Reforms, Health Workforce Australia has been established. We should be leveraging the investment made in this important agency and using it for aged care as well.

“How aged care interfaces with other areas of public policy (e.g. health, housing, disability services, income support policy, discrimination policy, taxation etc) is not as well developed in the report as we would have expected…

“There is not much information about the future of the Home and Community Care Program (HACC). […]In our submission to the Productivity Commission, UnitingCare NSW.ACT stressed the important role of the HACC program in funding innovative locally based services that restored health and well being for older people and intervened early in the ageing process. We recommended consideration be given to including an acuity and risk adjusted capitated system of block payments  made directly to approved providers assessed on the basis of the population served by that provider that would enable the funding of programs to promote wellness and healthy ageing and opportunities for social engagement. There is a very strong evidence base that demonstrates the value of early interventions like this particularly in rural and remote areas and for special needs groups.”

“More detail and discussion will be needed to make sure that regulation of quality is truly outcome focussed; that the same regulation applies across the service continuum and that providers are rewarded for achieving quality outcomes. More detail is also needed about what will be the indicators of quality across all aspects of aged care, so that consumers can have public access to this information for all providers so that this enables them to make wise choices. UnitingCare NSW.ACT recommended the establishment of a ‘My Aged Care’ website for this information and we would like to see this idea developed further.”

“Transition arrangements – how we move from a highly regulated aged care system to one which effectively creates a competitive market for aged care, needs further thought. 

“We should expect that if these reforms are fully implemented, there will be some industry re-structuring that will naturally occur. Transition arrangements will need to cater to this inevitable restructuring.
Gillian McFee, Director, UnitingCare Ageing NSW & ACT

Written comments on the draft report must be submitted to the Productivity Commission by Monday, 21 March 2011. Feedback can be sent to

Tags: aged-care, australian-aged-care-regulation-commission, australian-seniors-gateway-agency, care, caring-for-older-australians, draft-report, health-reform, mike-woods, national-health-and-hospital-reform, productivity-commission,

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