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19 Jul 2016

The aged care sector has called for a taskforce to review the sector’s funding process, as new analysis shows the 2016-17 Budget would strip funding to older people in care by 11 per cent per resident each year.

The Turnbull Government announced $1.2 billion in cuts to aged care funding in the May Budget, largely through reductions in the complex care component of the Aged Care Funding Instrument.

The Government argued that providers were overclaiming by wrongly classifying residents as high complex care patients.

“There’s no hiding away from the fact that the residential aged care budget will blow out by a further $3.8 billion over the next four years without action to address inconsistencies in the way claims are made, with as many as one in five ruled to be too high,” Minister for Health Sussan Ley said in June.

Ms Ley’s comments were borne out by a Health Department response to a Freedom of Information request by the Australian Financial Review.

The Department rejected the request, saying that there were more than 26,000 pages detailing non-compliance in relation to claims for Government funding from aged care providers.

Making public such a significant volume of related information would be too time-consuming, the Department said.

“A preliminary search has identified that there are approximately 1100 emails, 430 documents and 800 page reports, comprising over 26,000 pages that may fall within the scope of the request,” it told the newspaper in July.

The Labor Opposition has also refused to reverse the cuts.

But a coalition of service providers said, while the sector understood the need to manage growth in health care spending, the cuts went too far.

UnitingCare Australia (UCA), Aged and Community Services Australia (ACSA), and Catholic Health Australia (CHA) commissioned Ansell Strategic to undertake a review of 501 aged care homes and almost 39,000 residents around the country.

The modelling indicated that the actual impact of the cuts would be more than $2.5 billion over the next four years alone, nearly $840 million more than the Government’s forward estimates.

“The 2016-17 Budget was particularly harsh as it targeted people with complex health care needs and those receiving treatment for severe pain and chronic diseases like heart disease, diabetes, and dementia,” UCA Chair Steve Teulan said.

“We wanted to fully assess the impact of the funding reductions so we commissioned modelling that looked at the potential impact on nearly 39,000 people in aged care homes.

“The results are stark. The cuts far exceed the amounts stated by Government and will reduce funding to support older people in care by $6,655 - or 11 per cent - per resident each year.”

Under these arrangements, the funding would not cover the costs of services currently provided to residents with complex needs, meaning many older people in care might miss out on vital treatments including physiotherapy, pain management, and skin care, Mr Teulan said.

“If these cuts are implemented as stated, by 2017 service providers will be forced to seriously consider both turning away sick old people who are seeking admission from hospital and reducing services, particularly allied health,” Mr Teulan said.

The providers called on the Government to defer the proposed cuts until it undertook proper analysis of their impact, and an evaluation of the relative costs of providing care to frail aged people in nursing homes.

They also called for a taskforce to review the funding process for aged care, with a view to establishing a more sustainable model which provides certainty to providers, residents, their families and carers, and long-term affordability for taxpayers.

Maria Hawthorne







Published: 19 Jul 2016