2019-2020

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

AGED CARE LEGISLATION AMENDMENT (IMPROVED HOME CARE PAYMENT ADMINISTRATION NO. 2) BILL 2020

 

 

 

 

 

 

 

SUPPLEMENTARY EXPLANATORY MEMORANDUM

 

 

 

 

Amendments Moved on Behalf of the Government

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Aged Care and Senior Australians, Senator the Hon Richard Colbeck)

AMENDMENTS TO THE AGED CARE LEGISLATION AMENDMENT (IMPROVED HOME CARE PAYMENT ADMINISTRATION NO. 2) BILL 2020

 

OUTLINE

 

The Bill amends the Aged Care Act 1997 (the Aged Care Act) and the Aged Care (Transitional Provisions) Act 1997 (the TP Act).

 

The purpose of the Aged Care Legislation Amendment (Improved Home Care Payment Administration No. 2) Bill 2020 (the Bill) is to improve the administration arrangements of paying home care subsidy to approved providers.

 

The Bill gives effect to the second stage of reforms to improve payment administration arrangements for home care packages announced by the Australian Government in the 2019-20 Budget. The first stage of the reforms to change home care subsidy from being paid in advance to being paid in arrears was introduced by the Aged Care Legislation Amendment (Improved Home Care Payment Administration No. 1) Bill 2020.

 

The Bill will not affect the eligibility of consumers to home care subsidy or the amount of home care subsidy payable for eligible home care recipients.

 

Currently, approved providers hold and manage any accumulated unspent funds (both Commonwealth subsidy and consumer contributions) that may arise over time on behalf of the home care recipient if the cost of the care and services they access is less than the sum of their home care fees and subsidies paid by the Commonwealth.

 

Once the measures in the Bill commence, the Commonwealth will retain, on behalf of care recipients, the Commonwealth subsidy that may be in excess of the cost of the care and services provided, to be drawn down in future.

 

The Bill introduces a mechanism whereby the Commonwealth portion of provider held unspent funds is taken into account for the purposes of the home care subsidy calculator if the provider elects to return unspent funds to the Commonwealth.  

 

The government amendments to the Bill simplify the mechanism by which the Commonwealth portion of unspent funds held by providers who elect to return that portion to the Commonwealth are taken into account for the calculation of home care subsidy. Providers who elect to return unspent funds will do this through a 100 per cent subsidy reduction from the cost of the care and services provided until the unspent funds are exhausted.

 

The simplification of the mechanism that is made by the government’s amendments to the Bill also removes a possible unintended impact on the calculation of the amount of home care subsidy that may have occurred in a limited set of circumstances where a provider elects to return unspent funds.

 

Financial Impact Statement

The Government amendments will not have any impact on the overall costings for the package of reforms.

 

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

AGED CARE LEGISLATION AMENDMENT (IMPROVED HOME CARE PAYMENT ADMINISTRATION NO. 2) BILL 2020

 

These amendments are compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

 

Overview of the amendments

The Aged Care Legislation Amendment (Improved Home Care Payment Administration No. 2) Bill 2020 (the Bill) gives effect to the second stage of reforms to improve payment administration arrangements for home care packages announced by the Government in the 2019-20 Budget.

 

The Bill introduces a mechanism whereby the Commonwealth portion of the provider held unspent funds is taken into account for the purposes of the home care subsidy calculator if the provider elects to return unspent funds to the Commonwealth. 

 

Providers who elect to return unspent funds will do this through a 100 per cent subsidy reduction from the cost of the care and services provided until the unspent funds are exhausted.

 

The amendments simplify the mechanism by which the amount of home care subsidy is calculated where a provider has elected to return unspent funds and prevents an unintended impact on the calculation of the amount of home care subsidy that may have occurred in a limited set of circumstances.

 

Human Rights Implications

A detailed Human Rights Statement was prepared for the Bill. These amendments do not affect compatibility with any of the human rights or freedoms identified in that Statement.

 

Conclusion

The amendments do not engage any human rights issues beyond those identified in the original Statement of Compatibility of Human Rights prepared for the Aged Care Legislation Amendment (Improved Home Care Payment Administration No. 2) Bill 2020.

 

Senator the Hon Richard Colbeck, Minister for Aged Care and Senior Australians

 

AMENDMENTS TO THE AGED CARE LEGISLATION AMENDMENT (IMPROVED HOME CARE PAYMENT ADMINISTRATION NO. 2) BILL 2020

 

NOTES ON CLAUSES

 

Amendment items 1, 2 and 3

 

Items 1, 2 and 3 amend new subsection 48-1(2) set out in item 2 of the Bill.

 

Item 1 omits the sentence ‘This is the unadjusted subsidy amount . ’ at the end of Step 5 of the Home Care Subsidy Calculator in new subsection 48-1(2).

 

Item 2 omits the following paragraph from the Home Care Subsidy Calculator in new subsection 48-1(2):

“Step 6. Subtract the provider held amount (if any) specified in, or worked out in accordance with, the User Rights Principles from the unadjusted subsidy amount.”

 

Item 3 omits the following paragraph in subsection 48-1(2):

“ The result is the amount of home care subsidy for the care recipient in respect of the *payment period. However, if the result does not exceed zero, the amount of home care subsidy is zero. ”

 

and substitutes the following:

“This is the amount of home care subsidy for the care recipient in respect of the *payment period.”

 

The effect of items 1 to 3 is to simplify the mechanism by which the amount of home care subsidy is calculated where a provider has elected to return unspent funds. The simplification is achieved by applying the provider held amount reduction in the Shortfall Amount Calculator before the amount of home care subsidy for the care recipient is calculated.

 

Amendment item 4

 

Item 4 is a consequential amendment to amendment item 2 above. Item 4 omits new subsection 48-1(4) from item 2 of the Bill. New subsection 48-1(4) provides for the User Rights Principles to specify the provider held amount, or the way to work out the provider held amount, for a care recipient in respect of a payment period for the purposes of Step 6 of the home care subsidy calculator. As item 2 omits Step 6 of the Home Care Subsidy Calculator relating to the ‘provider held amount’ as specified in or worked out in the User Rights Principles, new subsection 48-1(4) is no longer required.

 

Amendment item 5

 

Item 5 inserts a new Step 1A into the Shortfall Amount Calculator in new subsection 48-13(1) in item 7 to the Bill. New Step 1A provides that, if, in accordance with the User Rights Principles, the approved provider elects to return the Commonwealth portion of the care recipient’s unspent home care amount to the Commonwealth, the price of home care is to be reduced by the amount of the Commonwealth portion available at the end of the previous payment period, up to 100 per cent of the price.

 

Amendment item 6

 

Item 6 amends table item 1, column headed “a debit of ...” in the table to new section 48-16 in item 7 of the Bill relating to home care debits, to omit the words “(unadjusted subsidy amount)”. This amendment is consequential to the item 1 above, which removes the phrase ‘unadjusted subsidy amount’ from the Home Care Subsidy Calculator in new subsection 48-1(2) set out in item 2 of the Bill.