RC discusses what’s needed to uncap supply

A strong assessment process is required to move to an aged care system with an uncapped supply of services, industry stakeholders tell this week’s royal commission hearing.

Supply for residential care could be uncapped now, but overall there’s a need to better understand demand and for a more flexible regulatory environment, according to witnesses at Monday’s royal commission hearing in Adelaide.

The royal commission held a two-day workshop style hearing with panels of industry representatives to discuss, test and improve on the system design and program redesign proposed in a consultation paper released in December and subsequent feedback.

The paper sets out a multi-component model with different funding streams that aims to support aged care recipients to pursue and enjoy meaning and quality of life wherever they reside.

Senior Council Assisting Peter Gray said some submissions to the consultation rightly identified the model proposed in the paper had the underlying assumption that supply will become uncapped.

Supply is currently capped by the number of residential places allocated through the Aged Care Approvals Round and the number of home care packages in the system.

He asked the panel whether it was appropriate for aged care programs to be redesigned around the principle of uncapped supply and what was needed broadly to get there.

Assessment is crucial

Deputy Secretary of Ageing and Aged Care at the Commonwealth Department of Health Michael Lye said strong assessment and means testing processes that worked together and consistency of application were crucial elements to uncapping supply.

“[W]e would say that if you were going to move to that sort of world, that you need to have very good ways of assessing eligibility.

“We need to know what that demand looked like probably better than we do today and what the need looks like. So that puts a lot of emphasis in on the assessment process, making sure you’ve got that right,” Mr Lye told the royal commission.

The assessment process needs to work with a robust and consistently applied means test to know what the expenditure looks like, he said.

The third key area, which underpins a lot of work with the National Disability Insurance Scheme, is to ensure consistency so that two people with equivalent assessments or needs received the same level of assistance, Mr Lye said.

Residential sector ready

Economist Professor Mike Woods from the Centre of Health Economics at University of Technology Sydney also said a rigorous assessment was needed in order to uncap supply.

“You need to be very clear on why you are subsidising services for whom and by how much. And the assessment service does need to follow that through very closely,” Professor Woods told the hearing.

“I think you can uncap supply for residential care at the moment but primarily because it’s a less attractive good than certain other goods, which are subsidised services at home.”

However, he said the home care package program and the Commonwealth Home Support Program to an extent are not sufficiently mature in defining the need and eligibility for subsidies to uncap demand.

“I don’t think the assessment service supports that,” Professor Woods said.

‘Delayed care is denied care’

The chief executive of consumer peak body COTA Australia, Ian Yates, backed a strong assessment approach and he underlined the absolute need to uncap supply.

“[T]here should be a principle of uncapped supply in a community of our wealth and wellbeing and not to do so is to say that people who we assess as being in need and needing that support are not going to get it.

“We’re talking about aged care. You’re talking about later life. Many times delayed care is denied care,” Mr Yates told the hearing.

He also called for simplified and equitable means testing, unlike the current system, and a much more flexible regulatory environment to encourage creative and innovative services.

“[W]e have an institutionalised approach to aged care in Australia and we have to get out of that and have much more creative approaches, which exist in other countries.”

Uncap for economic efficiencies

Robert Bonner, director of operations and strategy at the Australian Nursing & Midwifery Federation’s South Australian Branch said uncapping supply made economic sense.

“The question is what’s the alternative to an uncapping of the system and it’s a continuation of what we have got now where people waiting for aged care services or disability services are trapped either without services or in completely inappropriate settings,” Mr Bonner told the commission.

He said there were people in acute care hospitals waiting for ongoing disability or aged care services, which was denying those people access to a descent service and life while adding cost and volume to acute care services.

“[W]e would argue that uncapping demand in fact has the potential to be economically beneficial to the community as a whole, whilst it might uncap costs in this particular sector,” Mr Bonner told the hearing.

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