In October, the Royal Commission into Aged Care Quality and Safety presented 124 recommendations to overhaul the Aged Care system. Key suggestions included moving young people with disability out of Aged Care facilities, addressing overreliance by nursing homes on chemical restraints, increasing Home Care Packages, improving residents’ access to allied health care services, introducing mandated staffing ratios in residentialaged care, an independent pricing authority, a new enforceable general duty of care and more.

“There’s been a variety of government and business discourse on what these changes could look like,” says Andrew Raworth, Rohling International’s Senior Consulting Manager.

“Regardless of the shape, form, or timeline of their implementation, what we do know for certain is that these changes will have a macro-effect on all aspects of aged care organisations.”

Aged Care service providers will need to update operational frameworks and workforce planning efficiencies and effectiveness, while simultaneously maintaining and improving quality of care outcomes and commercial viability.

“The key to getting ahead of these challenges is having an in-depth understanding of when and how your organisation engages with its customers and employees, and consequently, how each stage, and its processes, will have to change to align with the new recommendations,” says Raworth.

An example of this is the new case-mix classification tool that will underpin a new assessment and funding model for residential aged care in Australia.

While Australian National Aged Care Classification (AN-ACC) has not been confirmed, if implemented, it’s projected to approach assessments and funding from a holistic perspective, factoring in a resident’s physical capacity, cognitive capacity, mental health needs, and behaviour.

“While it would be easy to associate the introduction of a new assessment and funding instrument to only impact finance, funding, and assessment teams, the reality is that it will impact all aspects of a service provider’s operations across all levels,” says Raworth.

“For those that were around back in 2008 when ACFI replaced RCS, you’ll remember the significant challenges and costs across all levels of aged care organisations that underwent the transition.”

In terms of the employee experience, workforce planning will require changes and restructures to operational teams. For example, the current ACFI and funding staffing models that aged care operators have in place, such as ACFI teams and coordinators, and funding teams, would have to be completely pivoted to more effectively align to the new assessment and funding model.

Learning and development functions within the organisation will need to be geared up and training materials rolled out across all levels, from frontline staff through to executives and their associated teams.

All material, instructions, funding guides and documentation will need to be developed for employees and resident communications, with providers needing to plan for their employees to be re-trained.

“There’s also the question of centralised or decentralised assessment processes”, says Raworth. “Will the assessments occur from a newly-created government body, or will they remain with the provider? This is a further complexity that would need to be considered.”

The answer to these challenges is having strong IT and business alignment to support the organisational change management process, which will be vital to maintaining commercial viability and quality of care.

All systems will need to change to support the new assessment and funding model, which, for most providers, is not just one or two systems.

“How the resident’s funding information is stored and calculated for business use will impact Resident Management Systems. Clinical Management Systems will also have to be updated to reflect new assessment practices”, says Raworth.

Revenue planning and forecasting systems will also need to incorporate the changes in revenue models, so providers don’t create a mountain of manual work, and can spend time strategically planning and analysing data rather than spending time on data entry.

Sales and resident agreement systems will need to be updated with new funding tool terminology and business rules, and to ensure calculations are correct. Rostering systems, learning and development systems, government systems, and supportive software vendor systems will need to reflect the new assessment and funding tool so aged  are providers can upgrade ahead of the change.

This is only one aspect of residential aged care finance reform. Providers also have to consider changes in home care or retirement villages, capital financing and prudential regulations, as well as the wider royal commission recommendations.

While the idea of these changes can be overwhelming, and will take a lot of change management across multiple areas to implement, it will be less stressful and more cost-effective if you strategically plan now for the commercial and operational challenges that are on the horizon.

Otherwise, service providers will fall behind, and it will be a very costly exercise to catch up to industry leaders.

Ian Gilmour is Chief Operating Officer for Rohling International. Rohling International can help you manage this transition smoothly and in a cost-effective manner. Their aged care industry experts provide Finance Strategy, Business Effectiveness & Efficiency Improvements, IT Strategies & Solutions, and Project Delivery services.