What are the challenges facing aged care in 2025 – beyond legislation?

With the recent passing of the Aged Care Bill 2024, a new Aged Care Act starts from 1 July 2025, bringing with it a new regulatory model. Aged care providers have welcomed this, including peak body Aged and Community Care Providers Association (ACCPA). As well as anticipating future legislative adjustments, they must be aware of economic shifts, and technological advancements. By preparing for these changes, organisations can position themselves to seize new opportunities and mitigate potential risks.

Market dynamics and trends

The aged care market is characterised by a spectrum of organisational responses to external pressures. Some providers are exiting the market due to capital constraints and evolving regulations, creating opportunities for others to expand through mergers and acquisitions. Successful mergers often result in synergies, economies of scale, and enhanced market positions. For instance, a merger between two mid-sized providers might lead to improved service delivery and cost efficiencies, making the combined entity more competitive.

One of the most significant trends in aged care is the shift towards home care. In 2023, the number of Australians receiving long-term home care surpassed those in residential care, with 315,000 individuals opting for home care compared to 250,300 in residential facilities. This shift reflects a growing preference for ageing in place, driven by the desire for independence and comfort.

The rise of consumerism in aged care is another critical development. New entrants to the market are bringing fresh perspectives and heightened expectations. Older Australians and their families are now more informed and discerning, seeking providers that offer high-quality, personalised care. This trend necessitates a reimagining of aged care services to meet the evolving needs and preferences of clients.

Leveraging core competencies

Core competencies are the unique strengths that sets a provider apart. These might include exceptional customer service, innovative service development, or efficient operations. Identifying and enhancing these competencies is crucial for building a competitive advantage. For example, an organisation known for its high-quality care might invest in training programs to further elevate its service standards.

A well-crafted strategic plan leverages core competencies to achieve organisational objectives. This plan should be specific, actionable, and aligned with the organisation’s mission. By focusing on their unique strengths, providers can make informed decisions that drive growth and sustainability.

Successful projects begin with thorough planning. This includes setting clear priorities, defining objectives, and allocating resources effectively. Common pitfalls, such as shifting priorities and inadequate planning, can derail projects. By anticipating these challenges, providers can develop strategies to overcome them.

Unlocking agility

Agility in the aged care sector is the ability to adapt quickly to internal and external changes. Agile organisations are creative, collaborative, and people centred. They respond to market forces with confidence, leveraging their leadership and competitive advantages to stay ahead.

According to Graeme Evans, Regional VP AU & NZ at Epicor, technology plays a crucial role in the agility of an aged care organisation. “Selecting software that adapts to the ever-changing aged care industry provides aged care staff with the insight to effectively, and continuously evaluate the impact on service delivery.”

In 2025, the best aged care providers are identifying the expected changes during this year’s government legislation. Providers that identify the shifting market competition, dynamics and other trends will see that their core competencies are the unique strengths that sets them apart. These differentiators will be maintained by harnessing agility. This means being able to adapt quickly to internal and external changes. Whether it is exceptional customer service, innovative service development, or efficient operations, unlocking agility is crucial for building a competitive advantage.

For more information, download The 2025 Guide to Agile Aged Care.