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Thursday, 14 May 1987
Page: 3155


Mr LEE(9.28) —Before I commence detailed discussion of the Nursing Homes and Hostels Legislation Amendment Bill, I wish to associate myself with some of the comments made by the honourable member for Page (Mr Ian Robinson), who preceded me in this debate. In his closing comments he said that this area should be dealt with sensitively by the Minister for Community Services (Mr Hurford) and his Department. When I hear some of the more extreme elements in our community calling for further and further cuts in Government expenditure-some people have called for $16 billion to be cut from Commonwealth expenditure-I often wonder whether areas such as nursing homes and hostels would pay the penalty should these peoples' policies be implemented. Due to problems of available time in Parliament today, it is possible that the Minister may not have an opportunity to respond to the debate. I intend to respond to some of the points raised in the debate and what I aim to say has the support of the Minister. He has asked me to tell the House that if he does not get the opportunity to respond to all the points made by speakers in this debate, he will endorse my contribution.

The first point that should be made is that the shadow Minister for Community Services, the honourable member for Barker (Mr Porter), has shown abysmal ignorance of this subject. He has spoken mainly about Medicare and the health system, not about nursing homes and hostels, and he has shown great heartlessness by virtually wanting the Government to vacate this area. He wishes to leave nursing homes and hostels to private health insurance funds with the result that only the wealthy could afford nursing homes. The Australian Labor Party totally rejects this approach. The honourable member for Barker also suggested that Commonwealth regulations are currently preventing people from setting up nursing homes. That is completely incorrect. As the honourable member for Lowe (Mr Maher) rightly pointed out, the various State licensing authorities may stop people from opening nursing homes, because the State governments have the power to set standards and issue licences. However, the Commonwealth certainly has no objection to people establishing nursing homes, provided no taxpayers funds are required for the capital or recurrent funding. As I shall point out in a moment in greater detail, the need for regulation is related to the need to make sure that expensive care, heavily subsidised by ordinary taxpayers, goes to those who really need it and not to those who want it.

We should remember that, in the period from 1973 to 1985, there has been a 606 per cent increase in the Commonwealth subsidy per bed per day for nursing homes. During that period, average weekly earnings have increased by only 308 per cent and the consumer price index has gone up by only 233 per cent. We can see that the subsidy money that the Commonwealth Government puts into funding nursing homes has increased startlingly since 1973.

All the significant changes in the Bill represent responses to recommendations made by parliamentary committees such as the Senate Select Committee on Private Hospitals and Nursing Homes, chaired ably by Senator Patricia Giles, and the House of Representatives Standing Committee on Expenditure, chaired ably by its former Chairman, the Chairman of Committees, the honourable member for Grayndler (Mr Leo McLeay). In addition, this legislation also responds to demands made by the nursing home industry and by consumer representatives.

Some Opposition speakers have suggested that there has been inadequate time for this Parliament and for the industry to consider the initiatives now before the House. All major elements of the legislation have been discussed in great detail over the past 12 months with organisations such as the Australian Nursing Homes Association, the Australian Affiliation of Voluntary Care Associations, and the Victorian Aged Services Peak Council. In addition, there have been discussions with consumer bodies and union and professional organisations.

The new arrangements that the legislation implements will be introduced gradually over the next five years so as to ensure that the interests of the 75,000 frail aged residents of nursing homes and hostels are protected. In addition, the interests of the employees and the proprietors will be considered. In commenting on the new funding arrangements, the President of the Australian Affiliation of Voluntary Care Associations, the Reverend Donald Stewart, representing church and charitable service providers in all States and Territories, wrote to the Minister on 12 May this year as follows:

With the Nursing Homes and Hostels Legislation Amendment Bill now before Parliament, I wish on behalf of the AAVCA to express satisfaction at the general direction of the new legislation. The AAVCA, whose member bodies provide about 80,000 beds in nursing homes and hostels across Australia, has consistently campaigned for the sorts of changes that have now been introduced into Parliament.

When commenting on the funding arrangements, he wrote:

It is a welcome change for the management of the financial side of care to be placed in the hands of the care providing organisations. I believe the Australian taxpayer will not be disappointed with the result of our balancing of cost and care. On the care side we welcome the emphasis upon care outcomes.

The Government welcomes the undertaking given by the honourable member for Barker that the Opposition supports the legislation. That attitude reflects a welcome degree of bipartisanship that is to be commended. The Government trusts that the Opposition will honour this undertaking and not seek to repudiate it in the Senate, thereby negating the broad thrust of the reforms that it is presently welcoming.

The honourable member for Barker raised one point that caused me concern when he suggested that administration of this program be handed over to the various State governments. No Opposition speaker produced any factual reason for that action, and presumably the honourable member's proposal reflects a doctrinaire approach rather than a well considered analysis. To anyone who heard the previous speaker, the honourable member for Page, it would be hard to reconcile what he said with the views of the honourable member for Barker that authority in this area should be handed over to the States. As the member for Page pointed out, since the 1950s the Commonwealth has played a significant role in providing funds for nursing homes and hostels. In addition, many industry and consumer representatives have urged that the Commonwealth continue its stewardship of the provision of adequate nursing home and hostel accommodation. The Giles report states:

. . . the committee does not favour this method of financing-

that is, providing grants for the States-

However, the concept of a uniform system of program grants has many advantages if the grants are made by the Commonwealth to individual homes . . .

That is exactly what this legislation will implement. The Government's approach is directed to maximising the quality and availability of care. The Government expressly rejects any proposal that it should shirk its traditional responsibilities by passing them over to other levels of government. I could site an example in my own electorate of Dobell, on the New South Wales central coast. Only yesterday I was pleased to receive advice from the Minister for Community Services that he had agreed to extend capital assistance to the Brisbane Water Legacy organisation in my electorate. That organisation in the coming financial year will be able to establish a 40-bed hostel at Norah Head. It is a beautiful location on land which the New South Wales Crown Lands Office has kindly made available through the work of my colleague Harry Moore, the State Labor member for Tuggerah. I wish to congratulate people such as the President of Brisbane Water Legacy, Mr Stan Brown, on their efforts in ensuring that hostel accommodation will be available to people in my local area. It the policies of the honourable member for Barker were implemented, it would mean that groups such as Brisbane Water Legacy would no longer receive capital assistance to enable them to establish a 40-bed hostel. I cannot imagine State governments providing $800,000 to organisations such as Brisbane Water Legacy to help construct a hostel. That is exactly how much money is being provided in my local area.

The honourable member for Barker also criticised the proposals as leading to increased regulation. This Government has an impressive record of deregulation where regulation is not necessary-areas such as finance and the foreign exchange rate. However, the shadow Minister will be aware that inappropriate deregulation can in fact lead to greater costs. In this case in my view there is a strong need for regulation. Admission to nursing homes must be regulated to ensure that available beds go to those who need them. Nursing home residents are generally frail and vulnerable and regulation of standards is essential. If these were not monitored, care providers could unreasonably maximise profits through exploiting their monopoly and thereby impose unwarranted additional costs on the residents as well as the taxpayers. The honourable member for Petrie (Mr Hodges) and the honourable member for Barker queried the arrangements that will apply when the Minister determines, upon reassessment, that a resident no longer needs nursing home care. This legislation contains such a provision.

Increasing emphasis is being placed on rehabilitation in the Government's current policies. Under present arrangements residents may remain in a nursing home even when there is not a continuing need for intense nursing home treatment. In my view where such a case exists it sometimes works to the disadvantage of the resident. We should not forget that people remain in nursing homes at a substantial cost to the taxpayer-of the order of $15,000 to $20,000 a year for each resident. One could take the example of a person who suffers a stroke, who is admitted to a nursing home and who, because of the treatment and therapy he receives, experiences an improvement in his medical condition to such an extent that it is in his interests to move away from the nursing home, perhaps into a hostel or back to his own residence at home, with the support of community nurses or programs sponsored under the home and community nurses or programs sponsored under the home and community care program. That is in the interests not only of the taxpayer but also of totally rehabilitating that person. In any event, the Minister's power will be exercised only if the Minister is satisfied that there is no longer a medical need and that more appropriate alternative forms of care are available. In these cases residents and their families have a right to appeal to the Administrative Appeals Tribunal.

The honourable member for Petrie and the honourable member for Barker also raised a number of questions relating to standards, including how and when the new nursing home outcome standards are to be gazetted, why the Commonwealth Government should be enforcing those standards and the basis for the review of inspection decisions. The Commonwealth has developed the outcome standards in close consultation with the representatives of all State and Territory governments and it is envisaged that Commonwealth and State authorities will jointly enforce them. As soon as possible after this Bill becomes law, the new outcome standards will be gazetted by the Government. In addition, the Minister has outlined that a peer review mechanism will be established. That is in response to the strong demands from industry groups for the introduction of such a professional peer review rather than the more legalistic quasi-judicial approach. The peer review approach is intended to provide speedy redress for proprietors dissatisfied with any inspection decision. Because the peer review bodies will include industry and professional representatives, they will have the technical competence and the local knowledge to make decisions which represent practical and professionally competent solutions. Of course, any proprietor who is unhappy with these processes has the right of appeal to the Federal Court of Australia under the relevant legislation.

The honourable member for Lyne (Mr Cowan) indicated that nursing homes should be compared to primary schools, and treated with `a certain amount of discipline'. The new standards emphasise that nursing home residents are human beings with human rights and freedoms, and are expressly intended to overcome this type of dictatorial, demeaning attitude. The standards are intended to emphasise that frail aged people should continue as far as is possible to make decisions about activities of daily living, such as the clothes they will wear and so on. It is accepted that there will be some restrictions on their freedoms because of their medical condition and the constraints of communal living, but these should not go beyond those restrictions that are inescapable.

The honourable member for Lyne at one point suggested that, every time a new resident moved into a particular room, under the Government's guidelines that resident could perhaps demand that the colour of the curtains be changed or the carpet be removed and a colour or shading which was to that particular resident's choice should be installed. That is really taking things to the extreme. This legislation does not implement any such proposal. It simply means that if a proprietor is refurbishing a nursing home or modifying the environment, he has the responsibility to consult with the residents so that their views are taken into consideration because, ultimately, any decision will affect the lifestyle of those residents. The standards are intended to reflect the fact that nursing homes are not short term acute care institutions, but rather places which residents should be able to regard as their own home.

The honourable member for Lyne queried costs and the role of the geriatric assessment teams. It is estimated that inappropriate admissions to nursing homes represent up to 25 per cent of all residents at a cost in excess of $250m annually, thereby preventing those who genuinely need nursing home beds from gaining access. Assessment teams have always had access to the knowledge and experience of the aged person's general practitioner. As the multidisciplinary geriatric assessment teams have a detailed knowledge of aged care options in their regions and usually have good links with the various care services, they are well placed to facilitate access to the most appropriate form of care to match the needs of the assessed persons.

The honourable member for Petrie expressed concern that there would be an acute shortage of nursing home beds in four to five years' time resulting from the new nursing home growth control guidelines. This assertion ignores the Government's decision to maintain the existing ratio of residential care places at nursing homes and hostels at 100 places per 1,000 persons aged 70 years and over. The current planning guideline is for the construction of some 38,300 additional places by 1996-an increase of 35 per cent. The Government is rapidly expanding home and community care services to assist frail aged people to remain at home or with their families.

The honourable member for Petrie raised the question of how the new arrangements will affect homes serving younger disabled people. The homes which cater exclusively or predominantly for younger people with disabilities will continue under the present arrangements and be subsumed into the new disability services program from 1 July next year. Those homes whose clientele are mainly aged will be funded under the new arrangements provided for under this legislation, even though they might have a minority of younger residents.

The honourable member for Petrie expressed concern at the appropriateness of a standard grant system given the significant variations around Australia in the cost of individual items. The honourable member for Barker also queried the possible impact of standard grant funding on the financial situation of nursing home proprietors who have entered into expensive long term contracts or lease arrangements. I point out that the Commonwealth bed subsidy varies significantly from State to State and from home to home within each State. It varies from a maximum of $54.60 per day in Victoria to a minimum of $35.25 in Queensland, which is an amazing range. The phasing in over five years of new funding proposals will seek to ensure that that is not the case five years from now.

The Government acknowledges that there are significant variations from area to area in the cost of particular items. However, studies by the Department of Community Services have shown that higher prices in one category will often be offset by lower prices in other cost items. The new standard grant arrangements will provide nursing home managers with the flexibility to ensure that the most cost effective approach is provided. The Department's detailed analysis of nursing home costs has also shown that in some cases high costs are closely associated with leasing and other contract arrangements. There is little doubt that, particularly in Victoria, dubious arrangements have been entered into by private nursing home proprietors which have had the effect of substantially increasing the costs imposed on the taxpayer and on vulnerable nursing home residents.

I point out that the Government's new funding arrangements will ensure that proprietors who introduce more efficient operational standards will not be penalised by having their returns reduced. While the Department had expected its analysis to show significant economies of scale in nursing home infrastructure costs, that was not the case in any State; nor was any relationship found between the infrastructure costs and the dependency of residents and the characteristics of the physical structure of the home. This legislation has the full support of every member on this side of the House. I commend the Minister for introducing the second stage of this Government's reforms to nursing homes and hostels. I am sure it will go on record as another great achievement of the second term of the Hawke Labor Government.