In the years ahead, a new wave of aged care consumers will bring fundamentally different expectations for their care than what aged care organisations have been used to providing.
The growth and demand for home care is one of the best examples of how the market is evolving, which is why an awareness of the six key factors outlined in this article is imperative.
The growth and demand for home care: six key factors
1. Aged care funding
Age-related pensions and aged care could account for up to half of government spending by 2049–50. That is almost double what it was in 20101. With the financial pressures on the system, it is unlikely that consumers will only have to cover one-quarter of their aged care costs into the future, as the government will unlikely be able to foot the bill for the remaining 75 per cent, which is what currently occurs2.
2. A transition to patient centricity
In a 2017 Productivity Commission report, it was recommended that within five years the government re-configures the health system to be ‘patient-centred’3. This will require a transition to a system which better manages complex, long-term care needs; something it is not well equipped to do as it was designed more for managing acute injury and illness4.
3. An ageing population which will live longer
By 2040, it is predicted that there will be 5 million people in Australia aged 70 and older, who, on average, have a life expectancy greater than that of previous generations4. This demographic shift is driving the need for the abovementioned reforms.
4. Changing consumer preferences
In the decades ahead, older Australians will increasingly have the inclination and financial capacity to choose their preferred aged care services. Such preferences are already evident. In 2015-16, almost 90,000 people accessed home care packages. By 2021-22 the number of home care packages is predicted to reach 140,0002.
5. Declining informal care
Close to 17 out of 20 older Australians receive support from family, friends and neighbours for a range of needs which may otherwise be met by aged care organisations. It is predicted that this informal care may decline in the future5. As older Australians have a preference to live in their homes longer, home care becomes a well-positioned alternative if informal care decreases.
6. New and existing providers diversified service provision
New entrants to the home care market represent over one-third of providers across key locations6. Additionally, a number of existing Australian aged care organisations already provide both residential and home care services, which enhances their capacity to support clients as their needs change.
The time to prepare is now
Whether your organisation elects to provide home care services or not, you need to prepare for the changing aged care landscape in which home care increasingly exists.
Epicor’s latest white paper; The Growth and Demand for Home Care: Signals for a Changing Aged Care Landscape further discusses the factors outlined in this article. Download your copy.
- Australian Government, The Treasury, Australia to 2050: Future Challenges, 2010.
- Commonwealth of Australia (Department of Health), Legislated Review of Aged Care, 2017.
- Australian Government, Productivity Commission, Shifting the Dial: 5 Year Productivity Review, Inquiry Report, August 2017.
- PricewaterhouseCoopers, Practical innovation: Closing The Social Infrastructure Gap in Health and Ageing, February 2018.
- Australian Government, Aged Care Financing Authority, Annual Report on the Funding and Financing of the Aged Care Sector – 2017.
- KPMG, retrieved 22nd June, 2019, from https://home.kpmg.com/au/en/home/insights/2017/10/home-care-market-competition.html
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