industry & reform
Increased funding or user pays ?
Aged care taskforce : great expectations – opinion
By Ian Henschke
Two years after the completion of the Royal Commission into Aged Care Quality and Safety , there are great expectations the quality of aged care will be improved .
While much has been done , including better pay , better nursing care , new quality standards and star ratings , one of the key difficulties in this long-term reform process is funding .
Quality of care can ’ t be improved without adequate funding and transparency about how that funding is spent .
With a new aged-care act in development , it ’ s critical the government gets funding right ; otherwise , we ’ ll not get the quality services older people deserve .
To address this issue , Minister for Aged Care Anika Wells announced an aged-care task force in mid-June .
We were pleased its members include former National Seniors Australia chief Professor John McCallum .
The task force ’ s primary aim is to review funding arrangements to ensure they are fair and equitable and create a safe and high-quality system .
The task force of 14 is made up of providers , consumers , and policy experts .
All were appointed by the chair , Minister Wells , who said nothing has been ruled in or ruled out .
Some members of the task force have already made public statements .
Tom Symondson , chief of Aged and Community Care Providers Association ( ACCPA ), spoke shortly after he was appointed , saying , “ We don ’ t fund aged care well enough .”
He said we spend around 1.2 per cent of GDP on aged care , “ which is half compared to other developed nations ”.
But what he said next was revealing : “ At the moment , we have very restrictive caps on what people can be asked to pay .”
“ You can have a $ 20m mansion , and in a means test , it will be considered at $ 186,000 . “ That ’ s a crazy situation .” But , we should remember both Aged Care Royal Commissioners suggested a levy was the answer .
A 1 per cent Medicare-style flat-rate levy on a person ’ s income ( from July 2023 ) was recommended by Aged Care Royal Commissioner ( and former chief executive of Medicare ) Lynelle Briggs .
Co-commissioner Tony Pagone ( retired Federal Court judge ) also called for a levy but didn ’ t suggest a rate .
The Coalition government ruled out both options , while the Health Services Union supported a levy .
The head of the NSW branch wants a royal commission into health funding and a specific aged care levy of 0.65 per cent to be part of Labor ’ s policy platform .
Opposition leader Peter Dutton responded to Labor ’ s Budget last year , saying aged care needed “ additional ” funding but warned , “ aged-care funding is not a magic pudding ”.
He added , “ A respectful , dignified , world-class aged care system is only funded by residents or taxpayers .”
He concluded by promising “ to work with the government to ensure that our aged care system remains sustainable .”
We will hold him to that and Prime Minister Albanese ’ s vow to overhaul the system .
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To bring about any reform , government must have wide public consultation , and any changes to user pay must be introduced incrementally
Aged care must not and should not be politicised .
We can ’ t afford another 20 years of poor policy , especially as demographer Bernard Salt pointed out recently , “ There is an aged care freight train coming towards us .”
The terms of reference say the task force must ensure the system is “ fair and equitable ”, and this likely includes consumer contributions .
In her speech to the National Press Club , the minister said the task force would provide a draft report by October with a final report in December .
It ’ s likely the funding options put forward at the end of the year will be announced in the 2024 May Budget .
When we survey our members , they overwhelmingly favour the levy approach .
In a separate study , Flinders University ’ s Caring Futures Institute surveyed more than 10,000 people not currently using aged care services .
They found that over 70 per cent of people would be willing to pay a larger co-contribution to receive the support they need to live at home rather than enter a residential aged care facility . The Flinders University research also discovered the majority of current income taxpayers would be willing to pay “ an additional 1.4 per cent income tax per year to ensure satisfactory quality aged care is delivered .” To bring about any reform , government must have wide public consultation , and any changes to user pay must be introduced incrementally . Care recipients should contribute to aged care costs only if they have capacity to pay .
A safety net must be there for those who can ’ t afford to pay , and providers must demonstrate full financial transparency .
We ’ re constantly told , “ We want to know the extra money goes into care , not into the profits of a provider .”
Any levy , tax increase , and user charges must be directly matched by high-quality care .
The answer may be a combination of ways to achieve the funding required .
Australians expect it , and those receiving care deserve it . ■ Ian Henschke is the chief advocate of National Seniors Australia
12 agedcareinsite . com . au