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Aged Care Amendment (Transition Care and Assets Testing) Bill 2005

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2004-2005

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

 

 

 

 

 

 

AGED CARE AMENDMENT (TRANSITION CARE

AND ASSETS TESTING) BILL 2005

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Aged Care,

the Hon. Julie Bishop, MP)

 

 



 

 

AGED CARE AMENDMENT (TRANSITION CARE

AND ASSETS TESTING) BILL 2005

 

 

OUTLINE

 

 

Leave from residential care for flexible care

This Bill will amend Divisions 42 and 44 of the Aged Care Act 1997 (“the Act”). 

 

These amendments are necessary to ensure that leave arrangements are in place to allow existing recipients of residential care, as defined under the Act, to receive transition care following a hospital stay.  Such leave arrangements will ensure that care recipients’ normal care arrangements remain available following a period of transition care, by maintaining the provision of subsidies to the approved providers of their residential care. 

 

In the 2004-05 Federal Budget, the Australian Government continued its commitment to building a world class aged care system with a $2.2 billion package of measures responding to the recommendations of the Review of Pricing Arrangements in Residential Aged Care.  A range of new initiatives were funded which will improve the quality, availability and delivery of aged care in Australia.  One of the new measures announced in the Federal Budget was the establishment of a national Transition Care Program, which addresses the needs of some older people who have been hospitalised.

 

T he vast majority of older people return to their homes after a hospital episode.   However, a significant minority of older people are at risk of needing a higher level of community or residential aged care if appropriate rehabilitation services are not provided.  State and Territory Governments are generally responsible for these services. 

 

Based on the results of trials over the past few years, the Australian Government believes that even better outcomes will be achieved for individuals at risk of premature admission to an aged care home if further supports are provided to individuals after a hospital episode. 

 

The Australian Government recognises that most older Australians would prefer to live in their own homes and believes that the new Transition Care Program maximises an individual’s chance to achieve this.  The Transition Care Program will assist people to return to their homes or to lower levels of residential aged care by providing a mixture of time-limited aged care supports and therapeutic care, such as rehabilitation.  

 

The new program provides 2000 flexible care places over 3 years, establishing a national Transition Care Program for the first time in Australia. 

 

The Aged Care Principles (“the Principles”), will be amended to establish transition care as a specific form of flexible care for which an approved provider will be eligible for flexible care subsidy.

 

This amendment Bill will create a new category of leave from residential care for the purpose of receiving flexible care.  A subsequent amendment to the Residential Care Subsidy Principles will specify transition care as a form of flexible care for which leave from residential care is available, and establish the maximum period of leave available following a hospital episode.

 

The Bill will also extend provisions of the Act that deal with the reduction of residential care subsidy when a care recipient is on extended hospital leave.  This will now also apply to flexible care leave.  As such, the subsidy will reduce once a care recipient has been in hospital and transition care for at least 30 days.

 

Because the reduction in subsidy is achieved by reducing the classification level of the residential care recipient, this would make a transition care recipient normally in receipt of the concessional resident supplement ineligible, under current provisions of the Act, if they were reduced to the lowest applicable classification level.  An exemption to this, which currently exists for care recipients on long periods of hospital leave, will be extended to include care recipients in transition care.

 

Assets testing

This Bill amends the Act by introducing a number of measures to enable the Secretary of the Department of Health and Ageing to conduct assets assessments for new residents entering aged care homes and to delegate this power. 

 

These amendments to the Act also resulted from a recommendation of the Review of Pricing Arrangements in Residential Aged Care that assessment of residents’ or prospective residents’ assets should be the responsibility of the Australian Government, and not an approved provider (a person approved under the Act to provide an aged care service), preferably undertaken prior to entry into residential care.

 

Following the review, the Australian Government made a decision that responsibility for asset testing would be transferred from approved providers of residential aged care to Centrelink and the Department of Veterans’ Affairs (DVA) in the case of veterans. 

 

Assets testing by Centrelink and DVA will add integrity and fairness.  Providers will be relieved of the administrative burden of conducting assessments.  Residents will be better placed to make decisions about their care needs because they will have greater certainty about their financial situation prior to entry.

 

Funding to enable the transfer of assets testing to Centrelink and DVA was announced as part of the 2004-05 Budget package of measures to further improve residential aged care in Australia.  An additional $19.7 million over four years was allocated for this activity.  The new arrangements are to be implemented on 1 July 2005 and will apply to people who enter residential care on or after 1 July 2005.

 

Und er current arrangements, assets assessments are undertaken by an approved provider at the time a person enters residential care.  Approved providers may claim a concessional resident supplement or an assisted resident supplement from the Commonwealth, based on assets information provided by a resident at the time of their entry.  Approved providers may request a resident to pay an accommodation bond or accommodation charge based on this information.

 

The Bill provides a process under which the Secretary of the Department of Health and Ageing is able to determine the value of a person’s assets, and their eligibility for concessional resident status or assisted resident status.  It also enables the Secretary to delegate the power to make these determinations to the Chief Executive Officer (CEO) of the Service Delivery Agency (which is the Commonwealth Services Delivery Agency established by the Commonwealth Services Delivery Agency Act 1997 ) (Centrelink) and to the Secretary of the Department administering the Veterans’ Entitlements Act 1986 , which is currently the Secretary of the Department of Veterans’ Affairs.  In addition, the Bill allows for a sub delegation of this power.

 

The Bill provides that determinations as to the value of a person’s assets and resident status determination made by the Secretary of the Department of Health and Ageing will be reviewable decisions as defined under the Act .

 

The Bill allows for determinations in relation to assets assessments to be made prior to a person’s entry to a residential care service, in addition to when a person enters residential care.

 

The Bill also provides for a specified currency period for the determination of the value of a person’s assets undertaken by the Secretary of the Department of Health and Ageing.  The currency period will be notified to a person together with advice of assets value determination and resident status determination. The currency period for the determination will ensure that the assessment of a person’s assets, on which concessional or assisted resident status is based, is relatively current at the time the person enters residential care.

 

The Bill allows for an extension of the 7-day period, commencing from a person’s date of entry to residential care, in which a care recipient and an approved provider must enter into an accommodation bond or accommodation charge agreement, in circumstances where an agreement is required. The Bill extends this period to 21 days to allow for those cases where it will not be possible for the Secretary of the Department of Health and Ageing to complete assets assessments within a 7-day period.

 

The Bill also applies a 12-month transitional period during which approved providers may continue to undertake assets assessments in certain circumstances.  The transitional period has been introduced to prevent delays for people seeking to enter into residential care and to avoid the situation where there is a high volume of assessments to be completed on the commencement of the new arrangements.

 

The transfer of assets testing also dovetails well with the Australian Government’s election commitment to exempt accommodation bonds from the social security assets test entirely, until the bond is refunded to the person or the estate when they leave aged care.  A person entering residential aged care may have established a relationship with Centrelink through the assets testing process.  The person will be able to continue that relationship with the same agency through the bond exemption process.  Furthermore, access to independent financial information is available through Centrelink’s Financial Information Service, which is free. 

 



FINANCIAL IMPACT

 

Leave from residential care for flexible care

The leave arrangements from residential care, implemented by this Bill, will lead to a small saving with respect to the residential subsidy.  Where a resident has been in hospital plus transition care for a total of at least 30 days, there will be a reduction in the residential care subsidy paid to the normal approved provider by the equivalent of two classification levels for residents at least two levels above the lowest applicable level, or to the lowest applicable level for those only one level higher.

 

It is not possible to estimate the savings with any degree of confidence because:

·          there are no clear views with respect to the number of existing residents who will utilise the transition care program; and

·          the classification levels of these residents, which will affect the level of subsidy reduction, are not known.

 

Assets testing

The amendments have financial implications to departmental costs for the Department of Health and Ageing to meet Centrelink’s development, implementation and operating costs for the new assets testing arrangements.

 

The amendments also have financial implications to departmental costs for the Department of Veterans’ Affairs for the development, implementation and operating costs for the new assets testing arrangements (for veterans).

 

The departmental costs for the next four years for Department of Health and Ageing and Department of Veterans’ Affairs are shown below.

 

The amendments do not have financial implications to administered costs for any agency.

 

Budget Measure - Assets Testing

 

                                                04-05               05-06               06-07               07-08

                                                  $M                  $M                  $M                 $M

 

Health and Ageing                  0.434               5.283               4.923               4.986

 

Veterans’ Affairs                    0.721               1.367               1.398               1.581



REGULATION IMPACT STATEMENT

 

AMENDMENT OF THE AGED CARE ACT 1997 TO ENABLE CENTRELINK AND DEPARTMENT OF VETERANS’ AFFAIRS TO UNDERTAKE ASSETS ASSESSMENTS FOR NEW AGED CARE RESIDENTS

 

 

BACKGROUND

 

Australia’s aged care system is primarily regulated by the Aged Care Act 1997 and the accompanying Aged Care Principles 1997.  The Act and Principles came into effect on 1 October 1997.  The legislation governs all aspects of the provision of residential care, including planning of services, approval of service providers and recipients of care, payment of subsidies and responsibilities of service providers.  The Department of Health and Ageing has responsibility for administration of the Act and Principles.

 

Residential aged care is provided in the following forms:

·          Low care (previously known as hostel care)

·          High care (previously known as nursing home care)

·          Extra service care which involves the provision of a significantly higher standard of accommodation, food and services than in standard residential services; and

·          Respite care which is short term care available to frail older people for reasons such as relieving carers, the unavailability of a carer, illness or holidays.

 

The level of care provided to a resident by an approved provider is determined by the Resident Classification Scale (RCS) classification by an Aged Care Assessment Team.

 

The Australian Government pays a residential care subsidy to approved providers for providing residential care to care recipients. 

 

Approved providers are able to claim a concessional resident supplement from the Australian Government in respect of those care recipients who meet the criteria for concessional or assisted resident status as specified under the Act.

 

A resident’s eligibility to receive concessional or assisted resident status is currently determined by the approved provider, based on an assets assessment undertaken by the approved provider at the time of the care recipient’s entry to care.  The assets assessment is also used to calculate the amount of an accommodation bond or charge that a care recipient can be asked to pay, or to determine whether a care recipient should be referred to the Department of Health and Ageing for consideration as to their eligibility for assistance under the hardship provisions contained in the Aged Care Act.

 

The Act makes provision for approved providers to calculate the net value of residents’ assets and to determine their concessional and assisted resident status (Sections 44-10, 44-7 and 44-8 respectively).  The Part 6 of the Residential Care Subsidy Principles 1997 sets out how the value of a person’s assets is to be worked out.

 

Residents receive concessional resident status if they are being provided with residential care (other than respite care) and, at the time of their entry to care:

·          they are receiving an income support payment;

·          have not been a homeowner for 2 years of more, or they owned a home that was occupied by:

-             their partner or a dependent child;

-             their carer who had occupied the home for the past 2 years and, at the time of their entry to care, was eligible to receive an income support payment;

-             a close relation who had occupied the home for the past 5 years and, at the entry time, was eligible to receive an income support payment; and

·          the value of their assets was less than 2.5 times the basic age pension amount (rounded) at their time of entry (currently $29,500).

 

The assisted resident criteria are the same as the concessional resident criteria, except that an assisted resident’s assets can be up to 4 times the basic age pension amount (rounded) at the time they enter care (currently $47,000).

 

Section 44-9 of the Act makes provision for an approved provider to determine that a person is not a concessional or assisted resident, if the person does not provide sufficient information about their assets to enable the approved provider to determine whether they are an assisted or concessional resident.

 

Residents who do not meet the concessional or assisted resident criteria can be asked to make a payment to a provider toward the cost of their accommodation.  Those admitted as low care, or low care or high care Extra Service, can be asked to pay a bond.  Those admitted to high care (except for extra service) can be asked to pay an accommodation charge.

 

An assisted resident, unlike a concessional resident, may be asked to pay an accommodation bond or charge as long as the resident is left with assets of 2.5 times the basic age pension amount.

 

The responsibilities relating to accommodation bonds and accommodation charges are set out under Divisions 57 and 57A respectively.  These include provisions that agreements that an approved provider must enter into an accommodation bond or accommodation charge agreement with a resident within 7 days of the resident’s entry to care.  Paragraphs 57-2(1)(e) and 57A-2(1)(e) of the Act refer, respectively.

 

The accommodation bond is an amount, paid as a lump sum, a periodic payment or a combination of both, to the approved provider from which they can deduct a monthly amount (the retention amount) and earn interest.  The accommodation charge is a daily amount paid by the care recipient to the approved provider.  The precise amount of accommodation bond or charge requested by the approved provider is negotiated between the care recipient and the approved provider and is specified in an accommodation bond or charge agreement.

 

Accommodation bonds and the retention amounts of the bonds, and accommodation charges, must be used by the approved provider for one or more of the following purposes:

·          to meet capital works costs relating to residential care;

·          to retire debt relating to residential care; or

·          to improve the quality and range of aged care services.

 

In 2003 the Department introduced a process for verifying claims by approved providers for concessional resident supplement.  This process involves the State and Territory offices requesting information from residential care services that claim concessional supplements in order to validate their claims in relation to concessional resident status.  Where it is discovered that a resident has been incorrectly assessed as a concessional or assisted resident, the resident’s concessional or assisted resident status is cancelled and any supplement already paid in respect of that resident is recovered from the aged care service.   The approved provider may then request the resident to pay an accommodation bond or accommodation charge if there is a provision in the Resident Agreement with the provider that allows the approved provider to do that. 

 

As part of the concessional validation process undertaken by the State and Territory offices, residents’ assets information can be verified with Department of Veterans’ Affairs and Centrelink (if the person is currently in receipt of an income support payment through one of these agencies). 

 

Division 95 of the Act makes provision for the recovery of amounts overpaid to an approved provider by way of a subsidy under Chapter 3.  (If a resident is classified by an approved provider as a concessional or assisted resident, a concessional supplement is paid in respect of the resident as part of the residential care subsidy that the Australian Government pays for aged care residents.)

 

All aged care homes are required to meet specific concessional resident ratios which apply at a regional level.  Sanctions may apply to those homes that do not meet the required ratio.  Both concessional and assisted residents count towards the concessional resident ratio.  If a home has over 40% of its residents as concessional, it receives a higher rate of subsidy - currently $16.25 per day for each of those concessional residents.  If the concessional ratio within the home drops below 40% the supplement reduces to the standard level of $10.63 per day for each of the concessional residents.  This differential is specified in Part 5 of the Residential Care Subsidy Principles.   A cancellation of a resident’s concessional status may affect the home’s concessional resident ratio and hence its income.

 

In 2003-04, the Review of Pricing Arrangements in Residential Aged Care was undertaken to examine the longer term prospects of residential aged care services, including future arrangements for private and public funding, performance improvement in the industry and longer term financing. 

 

The Review was undertaken in consultation with service providers, health professionals and consumers.

 

The Terms of Reference for the Review are at Attachment A.  The final report of the Review was released in April 2004.

 

One of the recommendations of the Review was that the assessment of residents’ or prospective residents’ income and assets should be the responsibility of the Australian Government and carried out by Centrelink and the Department of Veterans’ Affairs (in the case of veterans) and not the aged care provider, preferably prior to entry into care.

 

As part of the 2004-05 Budget, funding of $19.7 million over four years was committed to fund Centrelink and the Department of Veterans’ Affairs (DVA) to conduct asset testing of new residents entering aged care homes, prior to admission wherever possible.

 

The new assets testing arrangements are to commence on 1 July 2005.

 

PROBLEM

 

Aged care providers are not always in the best position to assess residents’ assets and, in some cases, this results in incorrect assessments of concessional or assisted resident status.

 

To address this issue, in 2003, the Department introduced the concessional validation process under which staff in the Department of Health and Ageing State and Territory offices validate claims by approved providers as to concessional or assisted resident status.   However, State and Territory offices do not have the power to validate claims by residents in respect of some of the criteria for protecting the resident’s home from inclusion in the assets assessment (ie whether a carer or close relation has been residing in the resident’s home for a specified period and is eligible to receive an income support payment).

 

If it is found through the concessional validation process that a resident’s concessional status has been incorrectly assessed, the resident’s status is cancelled and any supplement paid in respect of that resident is recovered from the residential care service.  In this situation, it is often not possible for a provider to obtain an accommodation charge or bond from the resident in lieu of a concessional resident supplement.

 

This situation results in financial uncertainty for both providers and residents.

 



OBJECTIVES

 

What are the objectives of the government action?

 

The amendments to the Act have been designed to establish a legal framework under which Centrelink and DVA can undertake assets assessments, including determining concessional and assisted resident status, rather than approved providers.

 

The objectives of the new arrangements are to:

·          remove the administrative burden of assets assessments from providers, and allow them to concentrate on their primary function which is to provide quality residential aged care;

·          enable third parties to conduct assets assessment as this will result in fairer and more consistent assessments for aged care residents and potential residents;

·          obtain more accurate assessments by agencies that have expertise in this type of assessments, and the ability to verify information provided by residents and their representatives;

·          minimise the amount of Australian Government funding which is incorrectly expended on concessional supplement payments;

·          allow a 12-month transitional period to implement the new arrangements and avoid any disadvantage to residents or potential residents.

 

In March 2004, in response to the Review of Pricing Arrangements in Residential Care , the Australian Government agreed to the introduction of new assets assessments arrangements and related legislative amendments.

 

Prime Ministerial policy approval has been sought to proceed to amend the Act to allow changes to the Act that are consequential to the changes which have Government authority.  These consequential changes are:

 

·          extending the time in which approved providers and residents must enter into an accommodation bond or charge agreement from 7 days to 21 days;

·          applying currency periods for assets assessments, depending on the net value and types of assets a person holds; and

·          applying a 12-month transitional period.

 

OPTIONS

 

The Government has agreed that Centrelink and DVA (in the case of veterans), rather than service providers, will carry out assessments of prospective aged care residents’ assets, preferably prior to entry into residential aged care facilities.  The Government decision was based on Recommendation 10 of the Review of Pricing Arrangements in Residential Aged Care .

 

This option requires amendments to the Aged Care Act 1997 .

 

There is no other organisation that is in a position to carry out the assets assessments so the only alternative is to allow the present arrangements (as outlined previously) to continue.

 

IMPACT ANALYSIS

 

The proposed new assets assessment arrangements under which Centrelink and DVA will undertake assessments of residents’ and prospective residents’ assets, prior to entry wherever possible, largely reflect the assessment process that is currently undertaken by approved providers.  However, a small number of consequential changes are required to the current assessment process, including:

 

1.              Extending the 7-day period in which an accommodation bond and accommodation charge agreement must be entered into, to 21 days.

 

Under current asset assessment arrangements, Sections 57-2 and 57A-2 of the Act provide that where a person is required to pay an accommodation bond or charge (respectively) based on the value of their assets, the person and the approved provider must enter into an accommodation bond or charge agreement within 7 days of a resident’s entry to care.  The agreement sets out matters including the amount to be paid, when it is payable, how the payment is to be made, and what the resident is entitled to receive from the payment.

 

The Act provides for the imposition of sanctions on the approved provider if this timeframe is exceeded.

 

The 7-day period has been extended to 21 days because, on current estimates, more than 60% of assessments could take longer than 7 days, and the Act provides for the imposition of sanctions on the provider if this timeframe is exceeded.  It is expected that, with the exception of the most complex cases (ie those involving interests in companies and trusts) and cases where residents or potential residents delay submitting a request form or do not provide complete and accurate information, all assessments could be completed within 21 days of entry.

 

2.              Currency periods to apply to assets assessments.

 

Currency periods currently do not apply to assets assessments conducted by approved providers, as these are conducted at the time a person enters care.  As assets assessments will be undertaken prior to a person entering care in most cases under the new arrangements, there will be a period between a person’s assets assessment and their actual admission to care.

 

In order to ensure a person’s assets details are relatively current at the time they enter residential aged care, and their assessed concessional or assisted resident status is still appropriate, assessments will be current for varying periods of time, depending on the net value and types of assets a person holds.

 

For those people whose value of assets is unlikely to change to the extent that their assessed concessional or assisted resident status will need to be changed, a 12-months currency period will be applied to their assessment.  This category of people will include non-homeowners with assets that are equal to or less than the cut off for eligibility for concessional resident status (currently $29,500), and non-homeowners with assets equal to or more than the amount that is the cut-off for a part pension for a single non-homeowner (currently $430,000).  All homeowners and non-homeowners with assets between the amount that is equal to or less than the cut-off for eligibility for concessional resident status and the amount that is the cut-off for a part pension for single non-homeowners, the currency period applied to their assessment will be 120 days.

 

3.              A twelve-month transitional period will be allowed, commencing from 1 July 2005.

 

In order for a person to enter residential aged care, they must be recommended for that care by an Aged Care Assessment Team (ACAT).  ACATs conduct assessments and make determinations as to the level of care required.  ACAT assessments are valid for a period of 12 months.

 

The principal method for providing prospective residents with an assets assessment request form will be via an ACAT at the time the ACAT assessment is undertaken.  Assets assessment request forms will be available from other sources, including aged care homes.

 

People recommended by an ACAT for permanent residential aged care in the period 1 July 2004 and 30 June 2005, and who do not enter care prior to 1 July 2005, may not have been provided with an assets assessment request form prior to their entry.

 

The 12 month transitional period will prevent delays for people seeking to enter into permanent residential aged care.

 

During the transitional period, residents or potential residents may choose to obtain assets assessments from either an approved provider or Centrelink/DVA.  However, if a resident or potential resident obtains an assessment from Centrelink/DVA, they will be required to have any subsequent assessments undertaken by Centrelink/DVA in order to be classified as a concessional or assisted resident.  If a person requests an assessment from both Centrelink/DVA and an approved provider, the Centrelink/DVA assessment will override the assessment undertaken by the approved provider for the purpose of determining concessional or assisted resident status.

 

Industry

 

By removing the necessity for approved providers to undertake assets assessments, approved providers will be able to spend more time caring for residents.  They will be relieved of the administrative burden of conducting assessments.

 

Approved providers will have greater certainty as to their income due to Centrelink’s and DVA’s ability to conduct more accurate assessments.  This will result in a reduction in the number of incorrect determinations in respect of concessional and assisted status, and the reduced incidence of having these determinations overturned by the Department and the overpaid concessional supplements being recovered.

 

Residents and prospective residents will need to complete a form for Centrelink or DVA undertake an assessment.  The assessment will be based on assets information already held by Centrelink or DVA (in the case of income support recipients), or information that Centrelink and DVA will request from the resident or prospective resident to provide.  Centrelink and DVA will be verifying assets information provided, including information relating to a carer or close relative for the purpose of determining whether a resident’s home should be protected from the assets assessment.  These processes will necessarily take longer than the time currently taken by approved providers to complete assessments.

 

The extension of the 7-day period to 21 days for approved providers and residents to enter into an accommodation bond or charge agreement, is considered necessary to cater for those cases where it has not been possible for an assets assessment to be completed prior to a person’s entry to care, for example, care in an emergency.

 

The Department has entered into formal business arrangements with Centrelink and DVA which include specified timeframes in which assessments must be completed. 

 

During the 12-months transitional period, approved providers will conduct assets assessments for those residents or prospective residents who choose this course.  Industry representatives strongly support the transitional period as this will prevent delays in people entering care due to people not being aware of the changed assessment arrangements, or a backlog of assessments awaiting completion by Centrelink and DVA in the early stages of the new system.

 

Care recipients

 

The new assets assessment arrangements only apply to people who enter aged care from 1 July 2005.  Current residents will not be affected.

 

Under the new arrangements residents and prospective residents will be provided with assets assessments that are more accurate and consistent than those currently undertaken by approved providers.  This will enable residents and prospective residents to be better placed to make decisions about their care needs because they will have greater certainty about their financial situation and status prior to entry.

 

Although in the majority of cases assets assessments will be undertaken prior to a person entering care, in some cases this will not be possible, eg in the case of an emergency. 

People, who are not income support recipients, or who are not eligible to be concessional or assisted residents due to the value of their assets, are able to negotiate an accommodation bond or charge agreement with an approved provider without first obtaining an assets assessment from Centrelink or DVA.  The new arrangements need not affect such people.

 

Under the 12-months transitional period people will be able to choose whether to have their assessment conducted by Centrelink/DVA or an approved provider.  This will ensure that people are not disadvantaged by not having received an assets assessment request form from an ACAT, or having their entry to care delayed because of a backlog of assessments that Centrelink and DVA would otherwise have to handle in the early months of the implementation of the new arrangements.

 

Centrelink and DVA currently assess residents’ income after their entry to care.  Income details in respect of Centrelink and DVA clients who are income support recipients are obtained from information already held by Centrelink and DVA.  Income details in respect of people who are non-income support recipients are provided by residents, at the request of Centrelink and DVA.

 

Government

 

The cost to the Australian Government is $19.7m over four years for the development and implementation of the new arrangements.

 

The concessional validation function that is currently undertaken by State and Territory offices will not be required after 1 July 2006.

 

CONSULTATION

 

A comprehensive consultation process was undertaken as part of the Review of Pricing Arrangements in Residential Aged Care on all aspects of the provision of residential aged care.  This process included formal consultations with the aged care industry in States and Territories, as well as discussions with peak bodies, government agencies and other stakeholders.  Twenty-three aged care services were also visited by the Taskforce.  An Industry and Consumer Reference Group, with a membership comprising 29 industry and consumer representatives, was established to provide advice to the Review Taskforce.

 

The Review recommended to the Government that responsibility for asset testing new residents be transferred to Centrelink (and DVA) from providers.

 

Since the new assets assessment arrangements were announced in the 2004-05 Budget, consultation on the development of the arrangements has been undertaken with the Aged Care Advisory Committee and the Minister’s Implementation Taskforce.  Both these groups have representation from the aged care industry, consumers and government agencies.  Consultation with these bodies will continue over the next 18 months in order to obtain input on industry requirements and to monitor acceptance or otherwise of the new arrangements.

 

These groups are supportive of the proposed changes, although initially there was a concern in relation to extending the 7-day period in respect of Resident Agreements.  This was resolved by limiting the extension to 21 days.

 

The three other Government agencies who are key stakeholders in the new measure are Centrelink, DVA and the Department of Family and Community Services.  These agencies have been consulted on a regular basis since the announcement of the new measure and have contributed significantly to its development and implementation strategy. 

 

IMPLEMENTATION AND REVIEW

 

The introduction of the new assets assessment arrangements on 1 July 2005 was announced as part of the 2004-05 Budget.

 

A communication strategy for advising all stakeholders of the details of new arrangements has been developed.  All stakeholders will be provided with comprehensive information on the new measure before it is implemented on 1 July 2005.

 

The new assets assessment arrangements will be reviewed by October 2007 and recommendations will be made as to continued funding for this purpose.

 



 

AGED CARE AMENDMENT (TRANSITION CARE

AND ASSETS TESTING) BILL 2005

 

 

NOTES ON CLAUSES

 

 

CLAUSE 1 - SHORT TITLE

 

This clause provides that this Bill may be cited as the Aged Care Amendment (Transition Care and Assets Testing) Act 2005 .

 

CLAUSE 2 - COMMENCEMENT

 

This clause provides that:

 

·                      Sections 1 to 3 of the Act will commence on the day on which the Act receives Royal Assent;

 

·                      Schedule 1 will commence on the day on which the Act receives Royal Assent;

 

·                      Schedule 2 will commence on either 1 July 2005 or the day on which the Act receives Royal Assent, whichever is the later.  This ensures that the new assets testing arrangements do not commence earlier than has been authorised as the commencement date, ie 1 July 2005.

 

CLAUSE 3 - SCHEDULES

 

This clause provides that, subject to the commencement provisions in clause 2, each Act that is specified in a Schedule to this Bill is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item has effect according to its terms.



SCHEDULE 1 - LEAVE FROM RESIDENTIAL CARE FOR FLEXIBLE CARE

 

ITEM 1

 

A new subsection 42-2(3A) is to be inserted after subsection 42-2(3).

 

The addition of a new subsection 42-2(3A) will allow existing recipients of residential aged care to obtain leave from their normal care arrangements if they are in receipt of flexible care for which a flexible care subsidy is payable and the care recipient meets the requirements specified for flexible care in the Residential Care Subsidy Principles. 

 

It is intended that the Residential Care Subsidy Principles 1997 will be amended to specify transition care as a kind of flexible care which can be considered as leave from a residential care service.   It is also intended that the Flexible Care Subsidy Principles 1997 will be amended to specify transition care as a kind of care for which flexible care subsidy will be payable.

 

ITEM 2                      

 

Item 2 provides for a consequential amendment to amend subsection 42-2(4) to include a cross-reference to subsection 42-2(3A).

 

Subsection 42-2(4) prevents any days being counted as leave for a care recipient receiving respite care. However, the current provision is expressed to be “Despite subsections (2) and (3)”.   The inclusion of the reference to the new subsection 42-2(3A) means that subsection 42-2(4) also operates despite subsection 42-2(3A).

 

ITEMS 3 & 4             

 

Paragraph 44-4(1)(a) is repealed and a new paragraph 44-4(1)(a) is substituted.

 

Section 44-4 currently provides for subsidy to be paid at 2 levels lower than the care recipient’s classification on commencement of leave, where the care recipient is on continuous leave for hospital treatment for more than 30 days. A care recipient at the lower level will not change classification and a care recipient at one level above will simply drop to the lowest level.

 

 

The repeal of paragraph 44-4(1)(a) and the insertion of a new paragraph 44-4(1)(a) will extend the application of section 44-4.  Section 44-4 will now apply to the care recipient who is on leave from a residential care service under subsection 42-2(3A) and has been on leave continuously for at least 30 days first whilst on extended hospital leave and then on leave under subsection 42-2(3A). 

 



ITEM 5

 

Item 5 inserts a note at the end of subsection 44-4(1).

 

 

ITEM 6

                       

 

Subsection 44-6(3) is amended to widen the application of subsection 44-6(3) to provide that a care recipient will not be excluded from concessional resident supplement if their classification level is the lowest possible simply because they have been on extended continuous hospital leave or receiving flexible care that meets the requirements of subsection 42-2(3A).

 



SCHEDULE 2 - ASSETS TESTING

 

SUMMARY

 

This Schedule amends the Aged Care Act 1997 to make provision for the Secretary of the Department of Health and Ageing to undertake and make determinations about assets assessments and to make resident status determinations for residents and prospective residents entering residential care from 1 July 2005.  The provisions in this Schedule also provide that the Secretary of the Department of Health and Ageing may delegate this power to the Chief Executive Officer (CEO) of the Service Delivery Agency (Centrelink) and/or the Secretary of the Department administering the Veterans’ Entitlement Act 1986 , which currently is the Secretary of Veterans’ Affairs (DVA). The Bill also provides for a 12-months transitional period in which approved providers can continue to undertake assets assessments in certain circumstances.  The new assets testing arrangements were announced as part of the 2004-05 Budget.

 

ITEM 1

 

This item amends section 44-7(1) to limit the application of this section. This amendment will generally mean that those people who have entered residential care (other than respite care) before 1 July 2005 are not affected by the new assets testing arrangements to be introduced on 1 July 2005 in relation to determining their eligibility for concessional resident status.

 

ITEM 2

 

This item adds a new subsection 44-7(1A) which provides that a person is also a concessional resident if:

 

§   that persons receives residential care (other than respite care) through a residential care service on or after 1 July 2005, and

 

§   the Secretary has made a determination about the person’s resident status which is covered by subsection (1B) or (1C); and

 

§   this determination is currently in force. 

 

This item inserts a new subsection (1B) which provides that this subsection applies to a determination made under section 44-8AA before the person enters into residential care so long as the person would have met the eligibility criteria for concessional resident as set out in paragraph 44-7(1)(a), (b) and (c) if the reference to “entry time” specified in paragraph 44-7(1)(b)(ii) and (iii) had been taken to mean the time specified in the determination.  In other words, in determinations covered by this subsection the references to “entry time” in paragraphs 44-7(1)(b)(ii) and (iii) are to be taken to mean the time specified in the determination. 

 

This item inserts a new subsection (1C) which provides that this subsection applies to a determination made under section 44-8AA, at the time or after the person enters into residential care, so long as the person would have met the eligibility criteria for concessional resident as set out in paragraphs 44-7(1)(a), (b) and (c) at the applicable time as set out under subsection 44-7(2). 

 

ITEM 3

 

This item deletes the words “for the purposes of subsection (1)” from subsection 44-7(2) and adds headings before subsection 44-7(2) - “ What is the applicable time? ”- and subsection 44-7(3) - “ If there is financial hardship (whatever the applicable time) ” - to clarify the purpose of these subsections.  The effect of amendments is to allow for a wider application of subsection 44-7(2).

 

ITEM 4

 

This item amends section 44-8(1) to limit the application of this section. This amendment will generally mean that those people who have entered residential care (other than respite care) before 1 July 2005 are not affected by the new assets testing arrangements to be introduced on 1 July 2005 in relation to determining their eligibility for concessional resident status.

 

ITEM 5

 

This item adds a new subsection 44-8(1A) which provides that a person is also a concessional resident if:

 

§   that persons receives residential care (other than respite care) through a residential care service on or after 1 July 2005,

 

§   and the Secretary has made a determination about the person’s resident status which is covered by new subsections (1B) or (1C); and

 

§   this determination is currently in force. 

 

New subsection (1B) will be satisfied if the Secretary has made a determination under section 44-8AA before the person enters into residential care and the determination provides that the conditions as set out in paragraphs 44-7(1)(a)(b) and (c) have been met for the person at the time when the determination was made but in determining whether paragraphs 44-7(1)(a)(b) and (c) are satisfied, the relevant entry time is the date specified in the determination (rather than the date when the person entered the residential care service). 

 

New subsection (1C) will be satisfied if the Secretary has made a determination under section 44-8AA, at the time or after the person enters into residential care, and the determination provides that the conditions as set out in paragraphs 44-7(1)(a)(b) and (c) have been met for the person at the time when the determination was made and in determining whether paragraphs 44-7(1)(a)(b) and (c) are satisfied, the relevant entry time is the applicable time as set out under subsection 44-7(2). 

 

ITEM 6

 

This item amends subsection 44-8(2) by deleting the words “for the purpose of subsection (1)” from the subsection.  The effect of this amendment is to broaden the application of this subsection to apply to the newly inserted subsection 44-8(1A), (1B).  The item adds a heading to subsections 44-8(2) - “ What is the applicable time? ”- to clarify the purpose of the subsection. 

 

ITEM 7

 

This item adds a new section 44-8AA to allow the Secretary of the Department of Health and Ageing to make determinations as to a person’s eligibility for concessional or assisted resident status (resident status determination) as set out under sections 44-7 and 44-8.

 

The item also requires that, in order for a resident status determination to be made by the Secretary of the Department of Health and Ageing, a person must apply for a determination using a form for the resident status determination approved by the Secretary.

 

The item also provides that a resident status determination can only be made by the Secretary if the value of a person’s assets has been determined (the assets value determination) under the new section 44-8AB by the Secretary, and that the Secretary is satisfied regarding the matters relating to the person to be set out in the resident status determination.

 

The new subsection 44-8AA(2) provides that, within 14 days of a decision being made by the Secretary of the Department of Health and Ageing as to an applicant’s eligibility for concessional or assisted resident status, the Secretary must advise the person in writing of: the decision, and if a resident status determination has been made, the content of that determination.

 

The new subsection 44-8AA(3) provides that a resident status determination will come into force on the date on which is it made, or an earlier day which is stated in the notice of the determination.  Subsection 44-8AA(4) provides, however, if a determination is made after the person enters the residential care service (as mentioned in subsection

44-7(1A) or 44-8(1A)), the date stated in the notice of the determination as the day on which the determination comes into force, must not be earlier than the day the determination is made unless the Secretary of the Department of Health and Ageing is satisfied that exceptional circumstances justify the determination coming into force on the earlier date stated.

 

The new subsection 44-8AA(5) provides that once a resident status determination comes into force, it continues to be in force unless a person does not go into residential care (other than respite care) within the period between the time the resident status determination came into force and the time the assets value determination (on which the resident status determination is based) ceases or is revoked under the new subsections

44-8AB(3) or (4).

 

The new subsection 44-8AA(6) allows the Secretary of the Department of Health and Ageing to revoke a resident status determination, by written instrument, if the Secretary is not satisfied with any matters relating to a person which are set out in the determination for the resident status.  The date on which the determination ceases to be in force will be the date specified in the instrument.  The date for revocation can be a date prior to the date the instrument is made.

 

The new subsection 44-8AA(7) provides that within 14 days of a decision being made by  the Secretary of the Department of Health and Ageing to revoke a person’s resident status determination, the Secretary must give written notice of the revocation and the date on which the resident status determination will cease to be in force, to the person, as well as to each approved provider (if any) who has provided the person with residential care (other than respite care) through a residential care service since the determination ceased to be in force.

 

Item 7 also adds a new section 44-8AB to make provision for the Secretary of the Department of Health and Ageing to be able to make determinations of the value of a person’s assets in accordance with section 44-10. 

 

The new subsection 44-8AB(1) makes provision for the Secretary of the Department of Health and Ageing to be able to make determinations of the value of a person’s assets.  These determinations of the value of a person’s assets are to be made, at the time specified in the determination, in accordance with the provisions of section 44-10, if a person applies to the Secretary of the Department of Health and Ageing for an assets value determination using the form approved by the Secretary, and gives the Secretary sufficient information to enable the Secretary to be able to make the determination.  Subsection 44-8AB(1) also requires that the effective date of the determination of the value of a person’s assets is the date the determination is made, or a date prior to the date of the determination.

 

The new subsection 44-8AB(2) provides that the Secretary of the Department of Health and Ageing must give the applicant a copy of the determination within 14 days of the determination being made by the Secretary.

 

The new subsection 44-8AB(3), makes provision for a currency period to be applied to the determination of the value of a person’s assets by the Secretary of the Department of Health and Ageing, to ensure that the determination is still appropriate at the time the person enters residential care.  This provision takes account of the fact that most determinations will be undertaken at a date prior to their date of entry.  The period during which the determination is in force will be as specified in the determination.

 

New subsection 44-8AB(4) enables the Secretary of the Department of Health and Ageing to revoke a determination of the value of a person’s assets, by written instrument,  if the Secretary is satisfied that it is incorrect.  The date on which the determination ceases to be in force is the date that is specified in the instrument.  The cessation date may be a date prior to the date the instrument is made.

 

The new subsection 44-8AB(5) requires that if a determination of the value of a person’s assets is revoked by the Secretary of the Department of Health and Ageing, the Secretary must advise the person, in writing, of revocation of the determination and the date on which the determination ceases to be in force.  If the Secretary is aware that the person has given an approved provider a copy of the determination, the Secretary must also provide written notice to the approved provider of the revocation and the date on which the determination ceases to be in force.

 

ITEM 8

 

This item is amended by omitting the words “concessional resident or assisted resident” and substituting with “concessional resident under subsection 44-7(1) or an assisted resident under subsection 44-8(1)”.  The effect of this amendment is to limit the application of section 44-9 to persons who are concessional residents under subsection 44-7(1) or assisted residents under subsection 44-8(1).  Therefore, if a person who is a concessional resident under subsection 44-7(1) or an assisted resident under subsection 44-8(1) chooses to undergo an assets assessment by an approved provider during the transitional period, they will be required to provide the approved provider with sufficient information about their assets to enable the approved provider to determine whether the person can be a concessional or assisted resident.  If sufficient information is not provided to the approved provider, the person will not be a concessional resident under subsection 44-7(1) or an assisted resident under subsection 44-8(1) at that time.

 

ITEM 9

 

This item inserts a note at the end of section 44-9 that provides that the section does not affect those people who choose to have a determination of their concessional resident status (under subsection 44-7(1A) or assisted resident status (under subsection 44-8(1A).

 

ITEM 10

 

This item amends subsection 44-10(1) to widen the application to provide that the value of a person’s assets for the purposes of determining concessional resident status under section 44-7, assisted resident status under section 44-8, or the value of a person’s assets under section 44-8AB, is to be worked out in accordance with the Residential Care Subsidy Principles.

 

ITEM 11

 

This item amends subsection 44-10(2) to provide that in assessing the value of a person’s assets under sections 44-7, 44-8 or 44-8AB, in circumstances where an assessment must be made as to whether the value of a person's home should be disregarded due to occupancy of the home by a partner, dependent child, carer or close relation of the person, consideration must be given to the circumstances of the home occupancy at the time of valuing the assets of that person.

 

ITEM 12

 

This item amends paragraph 44-10(2)(a) by deleting the words “care recipient ” and substituting with the word “person ” to allow the paragraph to apply irrespective of whether the assets value determination is made prior to, at the time of, or after a person’s entry to residential care.  The amendment will result in the value of a person’s home (not only a care recipient’s home) being disregarded in working out the value of their assets if, at the time of an assets value determination, the home was occupied by a partner or a dependent child of the person.

 

ITEM 13

 

This item amends subparagraphs 44-10(2)(b)(ii) and (c)(ii) by deleting the words “of the care recipient’s entry to the residential care service” to provide that the value of a person’s home  (not only a care recipient’s home) is to be disregarded in working out the value of their assets if, at the time of an assets value determination, the home was occupied by a partner or dependent child, or by a carer who had occupied the home for the past 5 years and was eligible for an income support pension, or a close relation who had occupied the home for the past 2 years and was eligible for an income support pension.  This amendment will allow this provision to apply irrespective of whether the assets value determination is made prior to, at the time of, or after a person’s entry to residential care - in other words regardless of whether the person is already a care recipient or not.

 

ITEM 14

 

This item amends paragraph 57-2(1)(e) to extend the 7-day period to 21 days, commencing from the care recipient’s date of entry to the residential care service, in which an approved provider must enter into an accommodation bond agreement with a care recipient.

 

ITEM 15

 

This item is a consequential amendment to subsection 57(2) required as a result of the amendment in item 14 to extend the 7-day period to 21 days in which an approved provider must enter into an accommodation bond agreement with a care recipient.  The amendment will provide that if, after 21 days of a person entering residential care, an approved provider has not entered into an accommodation bond agreement with the care recipient, and a process has begun for a person to be appointed as the care recipient’s legal representative (paragraph 57-2(2)(b)), the 21-day period during which an accommodation bond agreement must be entered into may be extended until the end of 7 days after: a decision as to legal representation is made or the process ends for some other reason or for such further time as the Secretary allows having regard for matters specified in the User Rights Principles.

 

ITEM 16

 

This item adds a Note in relation to Section 57-12 that the process for calculating the maximum amount of an accommodation bond may vary from that set out under section 57-12, if a care recipient has received an assets value determination from the Secretary of the Department of Health and Ageing (under section 44-8AB) and has given the approved provider a copy of that determination.  See item 17.

 

ITEM 17

 

This item adds a new subsection 57-12(5) to modify subsections (1) and (2), and to disregard subsection (3), in relation to calculating the maximum amount of an accommodation bond, in circumstances where a care recipient has:

 

.           not yet entered into an accommodation bond agreement with the approved provider,

.           received an assets value determination from  the Secretary of the Department of Health and Ageing (under section 44-8AB) before or at the time of their entry to residential care and this determination is still in force at their entry time, and

.           given the approved provider a copy of that determination.

 

In such circumstances, the approved provider will not work out the value of the care recipient’s assets for the purpose of calculating the maximum daily accrual amount of accommodation charge in the same way as it would be worked out under section 44-10.

 

In such circumstances, if the time of the determination under section 44-8(AB) of the value of the care recipient’s assets (valuation time) is before the person enters the residential care service, references in paragraphs 57-12(1)(b) and (3)(a) to the time of the care recipient’s entry to the residential care service are to be taken as references to the valuation time.  In working out the minimum permissible assets value (paragraph

57-12(3)) for the purpose of calculating the maximum daily accrual amount of accommodation charge (paragraph 57-12(3)), the approved provider must either use the basic age pension amount at the valuation time, rather than at entry time, or such higher amount as specified in or worked out in accordance with, the User Rights Principles.  The value of the care recipient’s assets at the valuation time is the value specified in the determination.

 

The item also provides that if the time of the determination of the value of the care recipient’s assets under section 44-8(AB) (valuation time) is the time the person enters the residential care service, the value of the care recipient’s assets at their entry time is to be taken as the value specified in the determination.

 

ITEM 18

 

This item amends Note 2 to subsection 57-16(2) as a consequence of item 14 which extends the 7-day period to 21 days in which an approved provider must enter into an accommodation bond agreement with a care recipient.  The application of the 21-day time limit as specified under paragraph 57-2(1)(e) applies even if the residential care service was not certified at the time of the care recipient’s entry to the service

 

ITEM 19

 

This item amends paragraph 57A-2(1)(e) to extend the 7-day period to 21 days, commencing from the care recipient’s date of entry to the residential care service, in which an approved provider must enter into an accommodation charge agreement with a care recipient.

 

ITEM 20

 

This item is a consequential amendment to subsection 57(2) required as a result of the amendment in item 19 to extend the 7-day period to 21 days in which an approved provider must enter into an accommodation charge agreement with a care recipient.  If, after 21 days of a person entering residential care, an approved provider has not entered into an accommodation charge agreement with the care recipient, and a process has begun for a person to be appointed as the care recipient’s legal representative (paragraph 57-2(2)(b)), the 21-day period during which an accommodation bond agreement must be entered into may be extended until the end of 7 days after a decision as to legal representation is made or the process ends for some other reason or for such further time as the Secretary allows having regard for matters specified in the User Rights Principles.

 

ITEM 21

 

This item adds a Note in relation to section 57A-6 that the process for calculating the maximum daily accrual amount of an accommodation charge may vary from that set out in the section if a care recipient has received an assets value determination from the Secretary of the Department of Health and Ageing (under section 44-8AB) and has given the approved provider a copy of that determination.  See item 22.

 



ITEM 22

 

This item adds a new subsection 57A-6(4) to modify subsections (1) and (2), and to disregard subsection (3), in relation to calculating the maximum daily accrual amount of an accommodation charge, in circumstances where a care recipient has:

 

.           not yet entered into an accommodation charge agreement with the approved provider,

.           received an assets value determination from the Secretary of the Department of Health and Ageing (under section 44-8AB) before or at the time of their entry to residential care and this determination is still in force at their entry time, and

.           given the approved provider a copy of that determination.

 

In such circumstances, the approved provider will not work out the value of the care recipient’s assets for the purpose of calculating the maximum daily accrual amount of accommodation charge in the same way as it would be worked out under section 44-10.

 

In such circumstances, if the time of the determination under section 44-8(AB) of the value of the care recipient’s assets (valuation time) is before the person enters the residential care service, the reference in paragraph 57A-6(1)(b) to the time of the care recipient’s entry to the residential care service is to be taken as a reference to the valuation time.  The value of the care recipient’s assets at the valuation time is the value specified in the determination made by the Secretary of the Department of Health and Ageing.  In working out the minimum permissible assets value (paragraph 57-12(3)) for the purpose of calculating the maximum daily accrual amount of accommodation charge (subparagraph 57A-6(1)(b)(i)), the approved provider must use the basic age pension amount at the valuation time, rather than at entry time, or such higher amount as specified in or worked out in accordance with, the User Rights Principles

 

The item provides also if the time of the determination under section 44-8(AB)of the value of the care recipient’s assets (valuation time) is the time the person enters the residential care service, the value of the care recipient’s assets at their entry time is to be taken as the value specified in the determination.

 

ITEM 23

 

This item amends section 85-1 to include certain decisions as reviewable decisions under Division 85 of the Act.  This amendment will allow a person to request a review of the following decisions by the Secretary of the Department of Health and Ageing:

 

.           that they have been granted or refused a concessional resident determination, described in subsection 44-7(1A), or an assisted resident determination, described in subsection 44-8(1A), under subsection 44-8AA(1);

.           that their concessional resident determination, described in subsection 44-7(1A), or assisted resident determination, described in subsection 44-8(1A), has been revoked under subsection 44-8AA(6);

.           as to their assets value determination, under subsection 44-8AB(1); and

.           to revoke a determination of the value of their assets made under subsection

44-8AB(4).

 

 

ITEM 24

 

This item adds a new subsection 96-2(2A) to provide that the Secretary of the Department of Health and Ageing may delegate to the Chief Executive Officer (CEO) of the Service Delivery Agency (Centrelink) and/or the Secretary of the Department administering the Veterans’ Entitlement Act 1986 which currently is the Secretary of Veterans’ Affairs (DVA),  the Secretary’s powers to:

 

.           enable determinations as to concessional or assisted resident status (under section 44-8AA), and

.           determinations of the value of persons’ assets (under section 44-8AB),

 

to be made by these delegates.

 

ITEM 25

 

This item adds a new subsection 96-2(3) to provide that the Secretary of the Department of Health and Ageing may delegate to the CEO of the Service Delivery Agency (Centrelink) and the Secretary of the Department administering the Veterans’ Entitlement Act 1986 which currently is the Secretary of Veterans’ Affairs, his or her powers to review a decision under sections 85-4 or 85-5 to:

 

.           grant or refuse an application for a concessional resident or an assisted resident determination (under subsections 44-7(1A) or 44-8(1A) respectively);

.           revoke a resident status determination made under subsection 44-8AA(1);

.           determine the value of a person’s assets under section 44-8AB; and

.           revoke a determination made under section 44-8AB of the value of a person’s assets.

 

ITEM 26

 

This item adds a new subsection 96-2(6) to allow for the sub delegation of a delegated power.  Specifically, this new subsection provides that if the Secretary of the Department of Health and Ageing has delegated the power to make determinations regarding the value of a person’s assets or to make determinations regarding a person’s resident status to either (or both) the CEO or the Secretary of the Department administering the Veterans’ Entitlements Act 1986 (currently the Secretary of the Department of Veterans’ Affairs), then the CEO or the Secretary of the Department of Veterans’ Affairs can further sub-delegate that power to their respective employees, that is an employee of Centrelink in the case of the CEO, or an APS employee of the Department of Veterans’ Affairs in the case of the Secretary of Veterans’ Affairs.

 

ITEM 27

 

This item sets out the circumstances in which the amendments contained in the Aged Care Amendment (Transition Care and Assets Testing) Bill 2005 will apply.

 

The amendments in Schedule 2 will apply to all people who enter residential care on or after 1 July 2005 and who have been approved under section 22-1 of the Act on or after

1 July 2005 as a recipient of residential care. 

 

Item 27 also provides for a 12-months transitional period to apply from 1 July 2005 to

30 June 2006, inclusive.  During this period, if a person enters residential care and has been approved under section 22-1 of the Act before 1 July 2005 as a recipient of residential care, and this approval is still current, then this person may choose that the amendments made by Schedule 2 do not apply to that entry.

 

The item provides for other circumstances in which the amendments will not apply.  The amendments will not apply to a person who enters residential care if that entry occurred within 28 days after the person was last provided with:

 

.           residential care (other than respite care) through another service (the earlier service) and the person had paid an accommodation bond for entry to that earlier service;  and

.           the amendments did not apply to a person’s entry into the most recent earlier service

*          unless a person was being provided with low level care through the earlier service and is then provided with high level care through the new service, in which case an assets assessment may be required to work out the maximum daily amount of accommodation charge.  In such a case, the amendments made by Schedule 2 of the Bill will apply.

 

The item adds a final note to indicate that if the amendments do not apply to a care recipient entering into a residential care service, then the Act, as in force without the amendments, applies.