Providers urged to ‘reach out’ before closing services

It’s “bad behaviour” to close an aged home without notifying the department ahead of time, a bureaucrat has told providers at a recent industry conference.

It’s “bad behaviour” to close an aged home without notifying the department ahead of such action, a bureaucrat has told providers at a recent industry conference.

During an audience Q & A session following his keynote presentation at Aged & Community Care Providers Association’s Queensland state conference last Wednesday, Department of Health and Aged Care deputy secretary Michael Lye provided examples of bad and good behaviour and urged providers to reach out to the department if they are considering closing a home.

“We had a provider who closed services and didn’t tell anybody, they just announced it in the last week or two, and that’s not good behaviour. It’s just not,” My Lye told delegates.

He was likely alluding to Wesley Mission, who announced recently it was closing three homes due to sector pressures. The provider notified residents of the closures but not the department, which resulted in Minister for Aged Care Anika Wells telling reporters she was blindsided by the announcement, having found out through a breakfast television segment.

Michael Lye

Mr Lye gave an example of the preferred process for providers to follow and highlighted the potential consequences for each case.

“We have great providers who send us a letter and say ‘this is what we’re thinking about, this is what we’re planning. If we don’t get to a certain point, we’re going to take this action in two- or three-months’ time.’

“And they let us know that they’ve actually reached a decision on that. And then they have done the work with their residents. They’ve talked to us, we can tell the minister that so if it becomes a media issue that everyone can say, ‘look, this is planned, we’ve worked through with the organisation concerned’.

“So I just contrast that really good behaviour with some of the bad behaviour and the consequence of that [where] government will then turn around and say, ‘Okay, well, we’re going to have to crack down on this.’ And so it’s really important to reach out,” My Lye told the Gold Coast audience.

Providers encouraged to also seek assistance from peak body

ACCPA chief executive officer Tom Symondson echoed this call to speak up and seek confidential support in advance of a potential closure during an interview with Australian Ageing Agenda on the sidelines of the conference.

Tom Symondson

“If you’re considering doing something, tell us, because we do have experts in our team, we have an advisory team, which is staffed by people who’ve run facilities who have led nursing teams, who have led home care. Tell us, we will always keep it completely confidential, as you would expect, because then there are things potentially that we can do,” he told AAA.

Similarly, the department may also be able to help, he said. “Firstly, there are sources of funding. They’re not huge, but there will be things that the department might be able to do. The other thing that you avoid is the government being blindsided. When the closure announcement comes and the minister is doorstopped and doesn’t know anything about it, that’s difficult,” he said.

‘People are afraid to say they’re in trouble’

Welsley Mission is not the only provider to announce closures recently. Brightwater Care Group in Western Australia and Blue Care in Queensland are among other providers to announce closures in the last month. And more are expected.

After crunching the numbers of its benchmarking survey, StewartBrown senior partner Grant Corderoy told AAA in January “there could be somewhere between 30 and 50 home closures on the cards over the next 18 months.”

Despite the rise in closures, most of the time providers are not reaching out, Mr Symondson said.

“We don’t get a lot of people coming to us and saying, ‘we are at risk, we are at very serious risk, we’re on the edge, we’re on the cusp’. One of the reasons for that, though, to be completely honest, is people are afraid to say they’re in trouble. Because of the prudential indicators and the risk that then the commission is saying ‘well, have you got enough cash to keep going?’

“People are afraid to say, we are in a very bad – not just the bad place that a lot of our members are in all the time because of our funding situation but a really bad place.” One of the learnings is that providers need to start having those conversations early, he said.

“With 70 per cent of providers losing money, there are going to be people in that group that need to be having this conversation and are not doing so because of their fear that they will be penalised, but also that they will let down their consumers, their residents, and their community.”

The key risk is that there “may be people in our sector who are very seriously thinking about this, but they’re not necessarily talking about,” Mr Symondson said.

“If we have 1.7 per cent indexation again, well that’s a disaster.”

Tom Symondson

Indexation needs to match costs, says peak

To prevent further closures, the sector needs indexation that meets the cost of delivering care, Mr Symondson told AAA. “We all know what last year’s rate was 1.7 per cent when inflation was at 5 per cent.”

Besides this, cost pressures for human services organisation are always well above the Consumer Price Index, he said.

“We use more of the expensive goods than a household. So everybody sees inflation at 7 per cent but if you’re an aged care provider, you’re using a lot more electricity, you’re using a lot more fuel for travel, and you’re paying staff. Those are the things that inflate faster and are bigger proportions of your total cost base, so if we have 1.7 per cent indexation again, well that’s a disaster.”

While the government has said it wants indexation to match costs more closely, “the proof’s in the pudding,” Mr Symondson said. “We’ve actually got to see it turn up in the budget papers.”

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Tags: ACCPA, accpa qld conference, closure, Department of Health and Aged Care, featured, Michael Lye, Tom Symondson,

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