MYEFO changes add to providers’ pressures: peak
Residential aged care providers will be paid after services delivered according to funding changes, which will also link care minute funding to minutes delivered.
Provider peak body Aged & Community Care Providers Association has called aged care announcements in this week’s mini budget unhelpful and lacking consultation.
In the government’s recently released Mid-Year Economic and Fiscal Outlook 2024-25, from 1 July 2026, residential aged care providers will transition to being paid based on services delivered, a change that government states aims to simplify the payment process, lower administrative burden, and enable providers to improve forecasts around their government funding.
The funding announcement made on Wednesday more closely aligns residential aged care payments with other programs, such as the National Disability Insurance Scheme and home care program.
According to the government details, the transition to the new payment system will occur across two years, from 1 July 2026 to 30 June 2028, with an option for providers requiring additional support to extend this period to four years.
Speaking with Australian Ageing Agenda, Aged & Community Care Providers Association chief executive officer Tom Symondson said this funding approach was unhelpful at a time when aged care providers were facing so much change as part of the biggest reform program in decades.
“Aged care has had to endure more than $5 billion dollars in losses over the past few years, while at the same time striving to improve the lives of older Australians every day,” Mr Symondson said.
“These are unnecessary changes to funding and do nothing for older people, while placing a greater burden on struggling providers in the short term.”
The government has also announced that from 1 October 2025, care minute funding will be linked to the delivery of care minutes for residential aged care providers in metropolitan areas.
ACCPA does not support linking funding to care minutes compliance for providers who can demonstrate they are genuinely trying to meet care minute targets and cannot meet them due to ongoing workforce shortages beyond their control, Mr Symondson told AAA.
ACCPA has already commenced engagement with the government and will continue to do so over the coming months to guarantee providers are heard, he said.
“We’re disappointed the sector wasn’t consulted, and we will be engaging further with the government to find workable solutions,” Mr Symondson said.
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