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Aged Care Legislation Amendment (Increasing Consumer Choice) Bill 2016

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2013-2014-2015-2016

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

 

 

 

 

AGED CARE LEGISLATION AMENDMENT

(INCREASING CONSUMER CHOICE) BILL 2016

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by the authority of the Minister for Aged Care, the Hon Sussan Ley MP)



 



AGED CARE AMENDMENT

(INCREASING CONSUMER CHOICE) BILL 2016

 

OUTLINE

 

This Bill makes amendments to the Aged Care Act 1997 and the Aged Care (Transitional Provisions) Act 1997 to give effect to the first stage of the home care reforms announced by the Government in the 2015-16 Federal Budget. 

 

The changes will provide recipients of home care (consumers) with more choice and control over their aged care and will reduce red tape and regulation for aged care providers.  The changes also lay the platform for future aged care reforms, which will be guided by the Aged Care Sector Committee Roadmap for Reform and jointly developed with the sector.

 

The Government’s reforms will improve the way that home care services are delivered to older Australians.  The reforms will be implemented in two stages. 

 

In the first stage, commencing February 2017, funding for a home care package will follow the consumer.  This will enable a consumer to choose a provider that is suited to them and to direct the funding to that provider.  The consumer will also be able to change their provider if they wish, including if they move to another area to live.  

 

The second stage will build on these changes by integrating the Home Care Packages Programme and the Commonwealth Home Support Programme into a single care at home programme.  This will further simplify the way that services are delivered and funded.  The Government intends to introduce the new integrated programme from July 2018.  Separate legislation will be required for this stage.

 

These changes are an important step in moving towards an aged care system that is more consumer-driven, market-based and less regulated.  The reforms are consistent with the long term policy directions proposed by the Productivity Commission. 

 

The Bill will amend the Aged Care Act 1997 and the Aged Care (Transitional Provisions) Act 1997 in three main areas.

 

·          Funding for a home care package will follow the consumer, replacing the current system where home care places are allocated to individual approved providers in respect of a particular location or region.  This will provide more choice for the consumer in selecting their provider, as well as more flexibility to change their provider if they wish to do so.  Providers will no longer have to apply for new home care places through the Aged Care Approvals Round, significantly reducing red tape for businesses.

 

·          There will be a consistent national approach to prioritising access to home care packages through My Aged Care (the Government entry point/gateway to the aged care system).  The prioritisation process will take into account the relative needs and circumstances of consumers, determined through the comprehensive assessment undertaken by an Aged Care Assessment Team, and the time that a person has been waiting for care.  

 

·          There will be reduced red tape associated with providers who become approved under the Aged Care Act 1997 . This will encourage new providers to enter the home care market, supporting greater choice for consumers, but all providers will still need to demonstrate their suitability to become an approved provider and meet quality standards. 

 

The changes associated with the first stage will commence on 27 February 2017.

 

Financial impact statement

 

The Government has committed $73.7 million over four years to implement the first stage of the reforms.

 



REGULATION IMPACT STATEMENT

 

Contents

Purpose . 4

Policy context 4

Background . 5

Consumer demand and preferences . 5

Current operating environment - home-based care programmes . 5

Future aged care reform .. 8

1.     What is the policy problem? . 9

2.     Why is government action needed? . 12

The Government’s role in aged care . 12

Productivity Commission inquiry and reform pathway . 12

National Aged Care Alliance’s views . 13

Opportunities for de-regulation . 13

3.     What policy options have been considered? . 14

Introduction . 14

Option A: Increasing choice and flexibility for consumers . 14

Option B: Maintaining the status quo . 15

4.     What is the likely net benefit of each option? . 16

Option A: Increasing choice and flexibility for consumers . 16

Impact on individuals . 16

Impact on providers . 16

Treatment of unspent funds . 19

Option B: Maintaining the status quo . 20

Regulatory costings . 20

5. Who will be consulted and how will you consult with them? . 22

Consultation to date . 22

Future consultation . 24

6. What is the best option from those considered? . 25

7. How will you implement and evaluate the chosen option? . 26

Implementation . 26

Evaluation . 27

 



 

Purpose

 

Policy context

Australians are living longer and healthier lives and it is important that as people age, they have choice about their care.  To support this objective, the Government announced significant reforms to home care in the 2015-16 Budget ( Increasing Choice in Home Care , previously referred to as the Increasing Choice for Older Australians measure).

 

The reforms will support consumers [1] to receive the services they need.  At the same time, the reforms will strengthen the aged care system to provide high quality and more innovative services through increased competition.  The changes will build on the current consumer directed care (CDC) approach in home care and will be introduced in two stages.

 

From February 2017 (Stage 1), funding for a home care package will follow the consumer.  This will make it easier for consumers to select a home care provider and to change their provider should they wish to do so.  The current requirement for providers to apply for home care places will be removed, significantly reducing red tape.  The changes will give older Australians greater choice in deciding who provides their care and establish a consistent national approach to prioritising access to care.

 

From July 2018 (Stage 2), the Government intends to integrate the Home Care Packages Programme and the Commonwealth Home Support Programme (CHSP) into a single care at home programme to further simplify the way that services are delivered and funded.

 

This Regulation Impact Statement (RIS) relates to the first stage of the home care reforms.  The RIS provides background information on the current operating environment, including recent reforms relating to home-based care programmes, and addresses the following questions:

1.         What is the policy problem/s?

2.         Why is government action needed?

3.         What policy options have been considered?

4.         What is the likely net benefit of the policy options?

5.         Who has been consulted?

6.         What is the best option?

7.         How will you implement and evaluate the chosen option?

 

A separate RIS will be prepared for the second stage of the reforms following consultation with stakeholders on options for programme design, funding models and implementation. These consultations will commence in the coming months.

 

The Office of Best Practice Regulation (OBPR) has provided feedback on the RIS. Cost estimates have also been agreed with OBPR.

 

In this document, ‘the Department’ means the Commonwealth Department of Health unless specified otherwise.



 

Background

 

Consumer demand and preferences

The 2015 Intergenerational Report [2] shows that the number of people aged 65 and over is projected to more than double from 3.6 million people (15 per cent of the population) in 2014-15 to 8.9 million (23 per cent) by 2055 . The highest growth rate of all age groups will be for people aged 85 years and over, almost quadrupling current numbers (500,000 in 2015), to reach 2 million by 2055. By then, people aged 85 years or over will make up five per cent of Australia’s population, compared to only two per cent in 2015.   Among other considerations, such as health and housing, growth in this age group has particular implications for the current and future demands on aged care services.

 

The majority of older Australians live active and independent lives.  Sixty eight per cent of Australians aged 65 years and over currently live at home without accessing Government subsidised aged care services, twenty five per cent of elderly people live at home with some Government-subsidised aged care services and about seven per cent of elderly people live in residential aged care. [3]

 

As the population ages, demand for assistance to live at home is expected to remain strong and Government support will be sought.  In 2014-15, the average age of entry into a home care package was 82.5 years. 

 

Older Australians have a strong preference for continuing to live in their homes and communities for as long as possible. They also want to have a much greater role in decisions about their care, including what services are provided, by whom and when. This is consistent with the move to CDC in the home care and the disability sector. CDC is explained below.

 

Current operating environment - home-based care programmes

The Australian Government provides funding to support older people to remain living at home through two main programmes:

•         Commonwealth Home Support Programme

•         Home Care Packages Programme

 

The programmes have similar objectives - to support older people to remain living at home for as long as possible and to delay admission to permanent residential care.

 

The Commonwealth Home Support Programme focuses on supporting older people with less intensive or intermittent care needs and their carers.  The Home Care Packages Programme focuses on supporting older people who require more intensive care and services including ongoing case management and care co-ordination.

 

Commonwealth Home Support Programme

The CHSP commenced in July 2015, replacing the former Commonwealth Home and Community Care (HACC) Program, National Respite for Carers Program (NRCP), the Day Therapy Centres (DTC) Program, and the Assistance with Care and Housing for the Aged (ACHA) Program.

 

The CHSP is the entry level of Australia’s aged care system for older people who need assistance with daily living to remain living independently at home.  The CHSP funds organisations (service providers) to provide a range of services including domestic assistance (e.g. cleaning, gardening and home maintenance), personal care, nursing and allied health services, meals, transport, social support and respite care.  Consumers effectively choose services that meet their needs from a menu of services offered by local providers.

 

The largest component of the CHSP is services previously funded under the Commonwealth HACC Program.  In 2014-15, the Australian Government provided funding to approximately 1,100 providers to support 530,000 consumers through the Commonwealth HACC Program.  Total programme funding for 2014-15 was $1.3 billion.   In addition, the Commonwealth provided $580 million for services to older people in the HACC programs in Victoria and Western Australia.

 

Home Care Packages Programme

The Australian Government supports older people to remain living at home through the Home Care Packages Programme, with four levels of packages available to eligible consumers (with basic subsidies currently ranging from $7,942 to $48,184 p.a.).  Additional supplements are also payable to the provider, depending on the particular needs and circumstances of the consumer.

 

The Home Care Packages Programme commenced in August 2013, replacing the former Community Aged Care Packages (CACP), Extended Aged Care at Home (EACH) and Extended Aged Care at Home Dementia (EACHD) programmes. 

 

A range of co-ordinated services can be provided under a home care package, including assistance with personal care and activities of daily living, support services (such as cleaning, gardening, transport, home maintenance, social support and respite care), some aids and equipment, and clinical care.  Home care level 3 and 4 packages have a greater emphasis on delivering complex care in the home, including more clinical care where required. 

 

The Home Care Packages Programme is a subsidy-based programme administered under the Aged Care Act 1997 (the Act).  Payments are made by the Department of Human Services (DHS) to approved providers for eligible consumers. 

 

To be eligible for a package, a consumer has to be assessed and approved by an Aged Care Assessment Team (ACAT).  Subject to availability, the consumer can then be offered a package by an approved provider. Home Care Packages must now be offered to consumers on a CDC basis (explained in more detail below). 

 

Each provider has a limited number of packages determined by the Government - these packages (home care places) are allocated through the Aged Care Approvals Round (ACAR).

 

At present, new home care packages are allocated to providers at a regional level through the ACAR.  This is a large competitive process, conducted in accordance with Part 2.2 of the Act and the Allocation Principles.

 

 

 

Planning and allocation associated with the ACAR occurs at the regional level, i.e. Aged Care Planning Regions determined under section 12-6 of the Act .   The aged care planning ratio is set by the Government as a means of controlling financial expenditure.  The current planning target is 45 home care places per 1,000 people aged 70 years and over by 2021-22.

 

In 2014-15, the Australian Government provided funding of $1.364 billion to 504 approved providers, in respect of 83,800 consumers under the Home Care Packages Programme.

 

There is no standard fee schedule or regulated price for the various kinds of services that can be delivered under a home care package.  However, consumers are expected to make a contribution to the cost of their care.  Under the aged care legislation, a consumer may be asked to pay a basic daily care fee of up to 17.5% of the basic rate of the single age pension, plus an income tested care fee if their income is over a certain amount.  Details of the care fees payable in home care packages are available on the My Aged Care website. [4]  

 

Consumer Directed Care

Since 1 July 2015, all home care packages (around 73,000) have been required to be delivered on a CDC basis.  

 

CDC gives consumers greater flexibility in determining what level of involvement they would like to have in managing their own home care package.  Consumers and providers work in partnership to identify the consumer’s goals and needs, which form the basis of a care plan.

 

While the total amount of care and services will be limited by the level of the package, approved providers are encouraged to sub-contract or broker services from other service providers in order to deliver the range of care and services agreed between the approved provider and the consumer.

 

CDC also provides consumers with clear information about what funding is available for their care and services and how those funds are spent through an individualised budget and monthly income and expenditure statements.  These tools ensure that providers and consumers have a shared understanding of available resources and how those resources are being expended to meet the consumer’s needs.

 

An independent evaluation of the CDC pilot initiative was undertaken by KPMG in 2012. The evaluation found that, even after a short period of operation, there were positive outcomes associated with the increased levels of consumer choice and control. This included increased consumer “satisfaction with various aspects of their life” as well as a greater level of satisfaction with the quality of care they received. [5]

 

The expansion of CDC across all home care packages in July 2015 was an important step in moving to a consumer-driven system, but further reform is required to fully empower consumers to be in control of their care.   Through the introduction of CDC, many consumers now have more choice as to how their care is delivered, with increased transparency over what budget is available and how funds are spent.  However, there is limited portability for consumers if they wish to change their provider or move to another location.  In some cases, services can be delivered by another service provider under sub-contracting arrangements, but this is not available to all consumers. 

 

The home care reforms announced by the Government in the 2015-16 Budget will build on the current CDC approach to provide greater choice, flexibility and control to consumers.

 

Future aged care reform

An Aged Care Sector Committee has been established to assist in the co-design of future reforms. The Committee has an independent chair and includes representatives from across the aged care sector and the Department.

 

In 2014, the Committee and the Government developed the Aged Care Sector Statement of Principles to guide continuing reform of the aged care system and to embed a lasting partnership between the Government, consumers, providers and the workforce.

 

The Principles for the aged care sector of the future are:

•         consumer choice is at the centre of quality aged care;

•         support for informal carers will remain a major part of aged care delivery;

•         the provision of formal aged care is contestable, innovative and responsive; and

•         the system is both affordable for all and sustainable.

 

Moving to a market-based system is central to the Government’s plan for the future.  The Productivity Commission stated that competition, rather than extensive regulation, is the key to delivering innovative, quality services and an efficient and sustainable system.  These remain important drivers for future aged care reform. [6]

 

In 2015, the former Assistant Minister for Social Services, Senator Mitch Fifield, asked the Aged Care Sector Committee to develop an Aged Care Roadmap, building on the Aged Care Sector Statement of Principles, to help guide future reforms.

 

The Committee has now provided advice to the Minister for Aged Care.  The Roadmap provides the Government with the sector’s best advice on future reform, and how it should be staged. The Aged Care Roadmap sets out a long term vision for the sector, with key actions that will lead to a market based, consumer driven and sustainable aged care system.

 

The aged care system has seen many changes since the Productivity Commission put forward its comprehensive vision to transform aged care, and the Aged Care Roadmap enables the Government and the sector to prioritise what more needs to be done.



 

1.     What is the policy problem?

 

Overall, the aged care system in Australia is world class and well respected, with high quality services that reach and meet the needs of a very diverse population. However, as people are living longer thanks to better health and better health care, the demands on Australia’s aged care system are changing. 

 

Within this context, the home care system in Australia has a number of weaknesses.  These include:

•         limited choice and flexibility for consumers in the current care at home arrangements, including a lack of portability;

•         a high regulatory burden for service providers in applying for new home care places through the ACAR and in becoming an approved provider under the Aged Care Act 1997 ; and

•         lack of a consistent national approach to prioritising access to home care.

 

Limited choice and flexibility for consumers in the current care at home arrangements, including a lack of portability

At present, most consumers have limited choice and flexibility as to whom delivers their care and services. This will become a critical issue with the passage of baby boomers into older ages, a cohort that significantly differs economically, socially, and culturally from the previous generation. [7]   Changes in consumer expectations will increasingly act as a driver for change, with older Australians wanting more choice and flexibility in what services are available to them and how they are delivered.

 

Under the current home care arrangements, once a consumer has been assessed and approved as eligible for a package by an ACAT, a consumer must find an approved provider with an available package that is suitable for the consumer’s needs.  In some cases, this limits consumer choice, as providers can only accept new consumers if they have not exceeded their allocation of places. 

 

Lack of timely access to care and limited consumer choice were identified as some of the weaknesses of the aged care system in the Productivity Commission’s 2011 Caring for Older Australians report. Qualitative research commissioned by the former Department of Health and Ageing [8] with forums of older people and their carers also identified a number of recurring themes in their attitudes to aged care.  A key theme was that older people want to have choice about their services, provider and support, which was seen to afford greater control over their lives.

 

As each package is currently allocated to a particular provider in a specific aged care planning region, rather than to an individual consumer, there is also limited scope for a consumer to change provider.  This could happen, for example, if the consumer is not satisfied with care and services being provided or if the consumer moves to a different region.  In such cases, it can be difficult for consumers to change providers without a disruption to their care. The consumer may need to wait for a suitable place to become available with their preferred provider, often involving an extended waiting period or receiving a lower level of services as an interim arrangement.

 

At present, a consumer may accumulate unspent funds or contingency funds (an amount that is the balance between fees and subsidy and expenditure under a package). The unspent funds may be accumulated as a result of a decision by the consumer to make provision for emergencies, unplanned events or increased care needs in the future. Unspent funds can be retained by the approved provider when a consumer no longer receives home care from that provider, which is sometimes a financial disincentive to move to another provider and further limits portability.

 

A high regulatory burden for service providers in applying for new home care places through the Aged Care Approvals Round

The current system of allocating new home care packages is governed by the provisions of the Act and relevant Principles, and acts as a regulatory barrier for new providers and existing providers wanting to expand their business.

 

Under the current arrangements, in order to receive a home care subsidy from the Australian Government, a provider must be approved by the Department as an “approved provider” under the Act and have an allocation of places under the Act.  Places are allocated to providers through a competitive process known as the ACAR.  The ACAR is managed by the Department and is usually conducted on an annual basis.

 

The ACAR allocates a finite number of aged care places to those applicants who best demonstrate they can meet the needs of the ageing population within a specified aged care planning region.  Providers are required to submit a detailed application which includes information such as their capacity to provide services including relevant service delivery experience, management and workforce capability, service philosophy, approach to CDC, and where relevant, ability to provide services to special needs groups as defined under the Act.

 

In recent ACARs, there has been strong competition for new home care places, with a large number of unsuccessful applicants in each round.  In the 2014 ACAR, providers applied for 108,281 home care places in respect of the 6,653 places available.  In the 2015 ACAR, providers applied for 126,826 home care places in respect of the 6,045 places available. 

 

While the ACAR application process has been simplified in recent years, it still presents a significant regulatory burden on providers.

 

The current process and criteria for becoming an approved provider are considered outdated and inefficient. The suitability criteria (described in section 8-3 of the Act ) have not been substantially changed since 1997. Stakeholder feedback indicates that the current criteria unduly focus on key personnel (who may change over time) rather than on the capacity of the organisation to provide care in accordance with the legislation.

 

Providers must go through separate processes to be approved as a provider for home care and residential care, despite significant overlap in the types of details required under both applications.

 

This creates a red tape heavy process for becoming an approved provider. As a result, some potential providers are discouraged from entering the market.

 

Lack of a nationally consistent approach for prioritising access to care

At present, home care packages are allocated to providers and individual providers manage their own waitlists. Once a consumer has been assessed and approved as eligible to receive subsidised home care, they must find a provider with a suitable package level. There can be a delay in accessing a package in some areas, particularly for consumers seeking a higher level care package.

 

It is at a provider’s discretion to whom they offer a package. There can be significant variation in the waiting periods for packages across Australia with no systematic way of measuring or addressing the variation, or ensuring that those with the highest care needs receive care as a matter of priority.

 

Whilst the current system of allocating home care packages to a provider through the ACAR aims to achieve an equitable distribution of the total number of packages, there are still significant variances in distribution, waiting times and access between states, regions and local areas within regions.



 

2.     Why is government action needed?

 

The Government’s role in aged care

The aged care system aims to improve wellbeing for older Australians through targeted support, access to quality care and information services.  Currently, over one million older Australians receive aged care services each year.  By 2050, over 3.5 million Australians are expected to use aged care services. 

 

The Australian Government has principal responsibility for aged care planning, funding and regulation.  In its 2011 inquiry, the Productivity Commission found there are strong rationales for government involvement in aged care, including promoting equity of access to appropriate care, the protection of vulnerable consumers and the correction of market failures such as gaps in the provision of information.

 

As part of this role, the Department regulates access to and provision of places (attracting government subsidies) for aged care services.  The number of aged care places is determined by the aged care planning ratio, which is being progressively increased from 113 to 125 places per 1,000 people aged 70 years and over, by 2021-22.  In home care, the target ratio is increasing from 27 to 45 places per 1,000 people aged 70 years and over, by 2021-22. 

 

While more home care packages will be available to consumers each year in line with the aged care planning ratio, the total number of government subsidised home care packages will still be capped. 

 

Productivity Commission inquiry and reform pathway

A number of reviews of aged care, including the 2011 Productivity Commission inquiry, have found that the aged care system suffers key weaknesses, including a high regulatory burden, limited consumer choice, variable quality, and inconsistent and/or inequitable subsidies and user co-contributions.

 

In relation to consumer choice and flexibility, the Commission noted that:

“Older Australians…did not want to be passive recipients of services, dependent on funded providers. Rather, they wanted to be independent and be able to choose where they live, which provider they would use, the way in which services are delivered, and whether to purchase additional services and/or a higher standard of accommodation.

There is strong empirical evidence that consumer choice improves wellbeing, including higher life satisfaction, greater life expectancy, independence and better continuity of care. In addition, competition amongst providers in a system where consumers can exercise choice leads to a more dynamic system, with enhanced incentives for greater efficiency, innovation and quality. A more flexible system would also enable providers to increase the range and scope of their services, freeing them from the current highly regulated, risk-averse regime.” [9]

 

In response to the Commission’s inquiry, in 2012, the previous Government introduced a number of changes to the aged care system to address some of these issues.  While delivering some immediate improvements, these changes do not deliver the less regulated, more consumer-driven, market-based system envisaged by the Commission.

National Aged Care Alliance’s views

The National Aged Care Alliance (NACA) is a representative body of peak national organisations in aged care, including consumer groups, providers, unions and health professionals, working together to determine a more positive future for aged care in Australia. [10]

 

In 2012, the Alliance noted that the lack of choice in the aged care system was impeding efficient service delivery. In its first blueprint for aged care reform, the Alliance recommended:

“Removing the current regulatory restrictions on the quantity and type of services providers can offer. This would enable providers to be more responsive to older people’s needs and preferences. This reform would be introduced gradually with an initial focus on freeing up the provision of community care…” [11]

 

In 2015, the Alliance released its second blueprint for aged care reform, stressing the importance of consumer choice and control. [12]

 

Opportunities for de-regulation

The Australian Government is strongly committed to reducing the regulatory burden for business, community organisations and individuals.

 

The Aged Care Sector Committee developed a Red Tape Reduction Action Plan which has been endorsed by Government and can be viewed on the Department of Social Services website. [13] The Plan identifies 35 actions for reducing red tape and regulatory burden. To date, several of the action items have been completed.  The Department will work to continue to progress the remaining items, supplemented by more significant structural reforms such as those outlined in this RIS .



 

3.     What policy options have been considered?

 

Introduction

As explained in the policy context (page 3), the Government announced significant reforms to home care in the 2015-16 Budget.  There will be a phased approach to implementation, with Stage 1 to commence in February 2017 and Stage 2 from July 2018.

 

This RIS focuses on the changes proposed under Stage 1 of the Budget measure. The regulatory impact is discussed below. A separate RIS will be prepared for Stage 2 following consultation with stakeholders.

 

When preparing a RIS, Australian Government agencies must consider a range of viable policy options. Whilst a RIS would normally have at least three options, this was not feasible or practical in this case.  Two options are presented in this RIS:

•         Option A - Increasing choice and flexibility for consumers (as announced in the 2015-16 Budget); or

•         Option B - Maintaining the status quo.

 

Option A is the implementation approach presented in the legislative framework to be considered by Parliament in the Aged Care Legislation Amendment (Increasing Consumer Choice) Bill 2016. It should be noted that, in developing this option, a range of potential approaches and models for implementation have been discussed with stakeholders.  Some of these potential approaches were canvassed in the public discussion paper (see Question 5), such as the approach to the treatment of unspent funds.  This RIS focuses on the proposed implementation arrangements rather than approaches and models that have been considered during the development and consultation phase, but not progressed further.

 

Option A: Increasing choice and flexibility for consumers

Under Option A, funding for a home care package will follow the consumer.  Eligible consumers will be able to receive subsidised home care from any approved provider. They will no longer be restricted to providers that hold an allocation of places. This will provide greater choice for the consumer in selecting an approved provider, as well as flexibility to change to another provider if the consumer wishes to do so. 

 

To give effect to greater choice of provider and portability of funding, the following changes are proposed:

•         Providers will no longer be required to apply for home care places through the ACAR;

•         Existing arrangements that govern the management of allocated home care places (e.g. transfers, variation to conditions of allocation, relinquishments) will be removed;

•         The process for becoming an approved provider will be simplified; and

•         Unspent funds will generally move with the consumer if they move to another home care provider, or be returned to the consumer and/or the Commonwealth when the consumer leaves home care.

 

For the first time, there will also be a consistent national approach to prioritising access to home care through the My Aged Care gateway/entry point to the aged care system.

 

Rationale for this option

This option gives effect to the Government’s policy objectives for Stage 1 of the home care reforms, as announced in the 2015-16 Budget.  It will build on previous changes to the Home Care Packages Programme, including the introduction of CDC into all home care packages, and will further expand the functions of My Aged Care leveraging on the Government’s investment in existing operations and IT systems. 

 

This option is consistent with the principles for Australia’s future aged care system, as articulated by the sector in the Aged Care Sector Statement of Principles (approved by the Government in November 2014), the Aged Care Roadmap and with the long term policy directions proposed by the Productivity Commission and the National Aged Care Alliance. 

 

This option is also consistent with the Government’s commitment to reducing regulation and moving to a more market-based aged care system.  It also more closely aligns the home care arrangements in aged care with other government support programmes, including the National Disability Insurance Scheme (NDIS).

 

Option B: Maintaining the status quo

Whilst not the Government’s preferred approach, an option would be to maintain the current policy settings, including the allocation of new home care places through the ACAR, existing arrangements for the management of allocated places, and the current approved provider arrangements.  Instead, future policy changes could be considered in light of the legislated review of the current aged care reforms, which will take place in 2016-17. [14]   

 

Rationale for this option

This option would provide an opportunity to bed down current changes to the aged care system, including the introduction of the CHSP, expanded functions for My Aged Care and the extension of CDC to all home care packages, before making further structural changes.  However, as noted on page 7, further reform would provide greater choice, flexibility and control to consumers.



 

4.     What is the likely net benefit of each option?

 

Option A: Increasing choice and flexibility for consumers

Implementation of this policy option will address the weaknesses of the home care system outlined in Question 1 - What is the policy problem?   This option will increase choice, flexibility and portability for the consumer, reduce the regulatory burden for providers (in applying for home care places through the ACAR and in becoming an approved provider), and provide a nationally consistent approach for prioritising access to home care.   As explained in Question 5 below, the proposed approach to implementation has been developed in consultation with stakeholders.

 

Impact on individuals

This policy (Option A) will provide more flexibility for consumers to choose their service provider and to change their provider if they wish, including where the consumer moves to a different location.  There will be no additional regulation for individuals.  Consumers and carers will be supported by My Aged Care in accessing a home care package or changing providers, including through the assessment process and referrals to home care providers.  Consumers or their representatives will also be able to manage the process of choosing a home care provider themselves, with minimal support from My Aged Care, if they wish to do so.

 

Overall, the premise that allowing funding to follow the consumer and opening up the home care market will afford greater choice, flexibility and continuity of care for consumers was supported through feedback to the public discussion paper.

 

Submissions from most stakeholders in response to the discussion paper were positive that the reforms will enable consumers to choose a provider that best meets their needs (including, for example, providers that offer services sensitive to language and cultural needs), noting that appropriate supports will be needed for some  consumers to enable informed decision-making.

 

Consumer groups are strongly supportive of the reforms but would like to see the current changes go further, moving ultimately to an entitlement model where supply is not capped and the consumer is fully able to control how and where funding is spent.   As noted on page 12, while more home care packages will be available to consumers each year, in line with growth in the aged care planning ratio, the total number of government subsidised home care packages will still be capped under this measure. 

 

Impact on providers

Under the proposed changes, providers will no longer need to apply for new home care places through the ACAR.  The current ACAR application process is resource intensive for providers. In 2014, it was estimated that providers took 50 person hours to complete an ACAR application for home care places. [15] In recent ACARs, there has been strong competition for new home care places, with a large number of unsuccessful applicants in each round [16] .  A total of 527 providers applied for home care places in 2015. This has added to the criticism that the ACAR creates an unnecessary regulatory burden on business and community organisations, at times for no benefit to some providers.  The removal of the ACAR for home care places has been broadly supported by the sector.

 

Removing the concept of allocated home care places will enable the sector to transition to a more competitive, market-driven environment and allow consumer focused and innovative providers to expand their businesses to meet local demand and consumer expectations, including the needs of consumers with dementia and other special needs. Providers will no longer be limited by the number of places they have and can expand their businesses as they see fit.  Service providers that do not currently have an allocation of home care places, and in some cases may be providing sub-contracted services to an approved provider, have welcomed the opportunity to provide home care services directly to consumers.

 

Whilst most providers were supportive of the policy objectives, some providers have expressed concerns about the loss of business certainty and the potential impact on financial viability, with the transition to a more competitive market. There were some views that it may also affect providers’ ability to manage and plan their workforce, which may encourage casualisation of the workforce. Some providers have said that a casual or contract-based workforce could make it more difficult for them to monitor consistency of care quality, attract and retain staff. 

 

The peak bodies representing providers have expressed concerns that some small providers, particularly those in rural, regional and remote areas and/or catering to special needs groups, may find it challenging to remain viable as they have less capacity to market their services and remain competitive relative to larger providers. Contributing factors include the higher costs and resource intensity associated with delivering care to consumers in rural, regional, and remote areas and special needs groups, lack of economies of scale, and limited access to marketing resources. 

 

The Aged Care Financing Authority ( ACFA) has recently sought views from aged care providers operating in rural and remote locations and other stakeholders in order to inform ACFA’s study and report to the Minister on ‘ Issues affecting the financial performance of rural and remote aged care providers ’. [17]

 

Some stakeholders have suggested that proposed changes in Stage 1 of the home care reforms may result in market consolidation, although it is difficult to estimate or quantify the possible impact on the sector.  It should be noted that the total number of home care packages will continue to grow nationally each year.  While some stakeholders have suggested that smaller providers are potentially more at risk in a competitive operating environment, others believe that smaller organisations will be able to draw on their local knowledge and relationships with consumers to position themselves as providers of choice within their communities.  

 

The home care market, as at 30 June 2015, is predominantly run by not-for-profit organisations (68%) which collectively hold 82% of the allocated home care places.  The remaining home care providers comprise state and local government-based operators (20%) who hold 8% of the allocated home care places, and for-profit operators (12%) who hold 10% of the allocated home care places.

 

Most home care providers (70%) are operating with an allocation of 100 or fewer home care places.  Almost a third of home care providers have an allocation of between 10 and 30 places.  At the other end of the market, there is a small number of home care providers (3%) with more than 1,000 home care places - most of these are not-for-profit providers.  Collectively, these larger providers hold around 30% of the total allocation of home care places .

 

The financial impact of the changes on providers will be closely monitored by ACFA.  Monitoring will particularly examine the impact on service delivery in regional, rural and remote areas.

 

Once home care places are no longer allocated to approved providers, the existing regulatory arrangements that govern the ongoing management of allocated places (e.g. transfers, variation to conditions of allocation, relinquishments) will also be removed from the legislation.  This will further reduce red tape for home care providers.

 

Currently, so me home care places are subject to specific conditions of allocation, for example, to give priority of access to special needs groups or to target services to a particular location.  These conditions are made at the time of allocation and are based on information in the applicant’s ACAR application.  While some providers and consumer groups were concerned that these conditions would no longer apply, overall, feedback from the sector is that the current system of conditions of allocation is not effective - it is not transparent and cannot be monitored effectively. 

 

The proposed changes will provide greater choice for consumers when selecting a provider.  O nce a consumer has been notified by My Aged Care that funding for a package is available, the consumer will be able to seek home care services from any approved provider with capacity to meet the consumer’s needs.  Providers will be better able to market their services, including to people from special needs groups and for specialised care (e.g. for people with dementia).  The delivery of care will be tailored to the consumer’s individual needs, including factors relevant to the care of a person with special needs.

 

While most s takeholders were supportive of the proposed arrangements, they emphasised that the changes will need to be closely monitored to ensure that access to care for people from special needs groups is not adversely affected.

 

Providers will still need to be approved by the Department under the Act in order to provide subsidised home care, but the process for becoming an approved provider will be simplified.  This will include updating the suitability criteria for approving providers, streamlining the process for becoming an approved provider, and providing a simple model for existing residential and flexible care providers to also provide home care.   Simplifying the process for residential and flexible care providers to become home care providers recognises that these providers have already been tested against the standards required to become an approved provider of aged care.  Once an organisation has been approved as a provider under the Act, approved provider status will no longer lapse after two years if the provider does not hold an allocation of places - this change will apply across all care types including home care, residential care and flexible care.  



 

Making these changes will remove some of the barriers to entry for new providers, whilst still ensuring that standards of care remain high.   Increasing the number of approved providers able to provide home care will support greater choice for consumers, but importantly, new providers will still be required to demonstrate their suitability to become an approved provider.  All approved providers of home care will need to meet the Home Care Standards and will be subject to independent quality reviews.

 

Overall, there was strong support for a streamlined approved provider application process during the consultations with stakeholders, as current practices are considered to be onerous and resource intensive for providers. 

 

Treatment of unspent funds

To give effect to choice and flexibility in home care, the Government believes that it is important that funds move with the consumer if they wish to change to another home care provider. During consultations, most stakeholders including consumers and providers agreed that unspent funds should move with the consumer if they change to another home care provider. This is consistent with the concept that the home care package ‘belongs to the consumer’ and will minimise financial disincentives to changing providers.  An administrative charge may be deducted from the amount of the unspent funds by the provider.

 

There was a mix of views as to what should happen to unspent funds where a consumer permanently leaves subsidised home care, e.g. enters residential care, no longer requires home care, or dies. Various policy scenarios were tested in the discussion paper and with the NACA Home Care Reforms Advisory Group (see Question 5).

 

The proposed approach is that any unspent funds must be returned to the consumer (or their estate) and the Commonwealth, based on the respective contributions made by each party.  The provider will be responsible for calculating the proportion of the consumer and Commonwealth contributions, using the total fees paid by the consumer and the total subsidy and supplements paid through the package.  The provider will be able to retain some of the unspent funds, as an administrative charge. 

 

To support transparency and choice for the consumer, before a consumer commences in a home care package, the provider must disclose all relevant charges that may be deducted from the total of any future unspent funds.  All applicable charges must be clearly set out in the Home Care Agreement offered to the consumer and be published on My Aged Care.    Th e provider will also be required to disclose to the consumer other matters which could restrict portability, such as minimum contractual periods and required notice to leave a package. 

 

Consistent with the Government’s approach to reducing regulation and encouraging businesses to compete in a market-based system, it is not proposed to initially regulate (prohibit or restrict) minimum contract periods, minimum notice requirements, or administrative charges on entry, exit or transfer. 

 

However, the Department will closely monitor practice in this area, including feedback and complaints from consumers, both in lead up to February 2017 and after implementation.  The Department will also work closely with peak groups representing consumers and carers and the NACA Home Care Reforms Advisory Group to monitor any changes in behaviour.  If there is evidence that restrictive conditions are being included in Home Care Agreements, it would be open to the Government to more actively regulate in this area in the future. 

 

While these changes will result in some additional regulation for providers (see regulatory costings below), there will be no regulatory impact on consumers.

 

Option B: Maintaining the status quo

As noted on page 15, this option would provide an opportunity to bed down current changes to the aged care system, including the introduction of the CHSP, expanded functions for My Aged Care and the extension of CDC to all Home Care Packages, before making further structural changes.

 

However, this option would provide little scope for the Government to address the  policy problems outlined in Question 2, namely limited choice and flexibility for consumers in the current care at home arrangements including lack of portability, and inconsistency in prioritising access to home care.  It would also not deliver a significant reduction in regulation and red tape for providers.  

 

Regulatory costings

The regulatory cost estimates, as outlined in Table 1, have been agreed with the Office of Best Practice Regulation.

 

Option A:  Increasing choice and flexibility for consumers

The overall regulatory saving is estimated to be $4.51 million per year.  This figure is based on the following elements:

·          providers no longer being required to apply for home care places through the ACAR (saving of approximately $4.38 million per annum);

·          removal of existing arrangements that govern the management of allocated home care places, e.g. transfer of places, variation to conditions of allocation

(saving of approximately $0.04 million per annum); and

·          streamlining approved provider arrangements, including simplifying the application form to become an approved provider across all provider types (home care, residential care, and flexible care) to reflect updated suitability criteria for approving providers, providing a simple model for existing residential and flexible care providers to also provide home care, and removing the lapsing rule for approved provider status across all provider types (saving of approximately $2.63 million per annum).

 

These savings offset the estimated regulatory impact of new responsibilities for home care providers regarding the treatment of unspent funds (approximately $2.55 million per annum). Specifically, these responsibilities include reconciling the amount of unspent funds and transferring or returning amounts to another provider, the consumer or the Commonwealth. As explained earlier, providers will be allowed to cover some of these costs through an administrative charge when a consumer changes to another provider or no longer requires home care, provided the amount is disclosed to the consumer upfront.



 

 

Table 1. Regulatory burden and cost offset estimate table

 

Average annual regulatory costs (from business as usual)

Change in costs ($ million)

Business

Community organisations

Individuals

Total change in costs

Total, by sector

($1.14)

($3.37)

$0

($4.51)

 

Cost offset ($ million)

Business

Community organisations

Individuals

Total, by source

Agency

 

 

 

 

Are all new costs offset?

* Yes, costs are offset  * No, costs are not offset  x Deregulatory—no offsets required

Total (Change in costs - Cost offset) ($ million) = ($4.51)

 

Option B: Maintaining the status quo

As this option is to maintain the status quo, there would be no additional regulatory impact on individual, community organisations or businesses.

 

Future reductions in regulation and red tape for business, community organisations and individuals could be progressed through implementation of the Red Tape Reduction Action Plan, which has been developed in conjunction with the Aged Care Sector Committee.  Any regulatory savings would be considered separately from this RIS process.



 

5.     Who will be consulted and how will you consult with them?

 

The Government and the Department are strongly committed to a co-design and partnership approach with the aged care sector to inform programme design and implementation. The Department has consulted widely since the 2015-16 Budget and has worked closely with stakeholders in developing the proposed implementation arrangements for Stage 1. 

 

Consultation to date

Advice from stakeholders on specific issues

The Department sought early views from key stakeholders in July and August 2015 to shape the policy content of the public discussion paper.

 

The Department has also sought advice from stakeholders on specific policy and implementation issues.  For example, the Department convened workshops in October and December 2015 with representatives from Aged Care Assessment Teams and providers to discuss the implications of the proposed changes to assessment and prioritisation.

 

National Aged Care Alliance advisory group

A new Home Care Reforms Advisory Group has been established under NACA to provide ongoing advice to the Minister for Aged Care and the Department on a range of design, implementation and transition matters.

 

Membership of the advisory group comprises a mix of consumer and provider representatives, allied health profession representatives, union representatives and a state government representative. The advisory group has met three times to date through a teleconference on 27 October, and face-to-face workshops and meetings on 17 November and 17-18 December 2015.  These meetings and workshops have focused on a range of policy and implementation issues, including the implications for business design/IT changes, and the approach to the treatment of unspent funds.

 

Further meetings will be held throughout 2016, through which the advisory group will continue to provide advice on implementation, communication and monitoring issues for Stage 1.  The advisory group will also provide advice on options for programme design, funding models and implementation arrangements for Stage 2.

 

Public discussion paper

The Department released a policy discussion paper on 25 September 2015.  The Increasing Choice in Home Care - Stage 1 - Discussion Paper was available for public consultation on engage.dss.gov.au until late October 2015.

 

Feedback was sought from the aged care sector and other interested parties on the policy design including the national approach/system, prioritisation, interim packages, unspent funds, changes to approved provider arrangements, impacts on consumers and providers and future information and support needs. The Department received 101 submissions from a range of stakeholders.  Around half of the submissions were received from providers, with a further quarter submitted by peak bodies representing consumers and providers (see Table 2). Submissions from organisations based in New South Wales and Victoria represented around half of the total number of submissions (see Table 3).

 

The discussion paper was promoted through a range of communication channels, including through the Department’s website, webinars, newsletters (Information for Aged Care Providers) and messages to the sector (via MailChimp).

 

Table 2. Number of submissions by stakeholder type

Table 3. Number of submissions by stakeholder location

Stakeholder type

Number of submissions

Service provider

48

Consumer/carer

2

Peak body - Provider

8

Peak body - Consumer

16

Consumer advocacy organisation

5

Disability support organisation

2

Seniors membership organisation

3

Professional organisation

3

Aged care assessment service

2

State Government

5

Federal Government

1

Other

6

Total number of submissions

101

State/territory

Number of submissions

ACT

5

NSW

29

NT

0

QLD

12

SA

10

TAS

1

VIC

22

WA

5

National

17

Total number of submissions

101

 



 

Webinar

To support the discussion paper, the Department conducted a webinar on 19 October 2015 to explain the proposed changes and provide an opportunity for stakeholders to ask questions.  Around 700 sites participated.  A video of the webinar and transcript are available on the Department of Social Services website. [18]

 

Sector Conferences and Presentations

The Department has actively engaged with stakeholders since the Budget announcement in May 2015 through participation in a range of meetings, forums and conferences with the sector.  These include meetings of the Aged Care Sector Committee, NACA, various state forums or workshops conducted by Leading Age Services Australia (LASA), Aged and Community Services Australia (ACSA) and the COTA Criterion Conference.

 

Future consultation

The Department will continue to consult with stakeholders throughout 2016, with an increasing focus on communication and stakeholder engagement activities to support consumers, providers and other stakeholders (further detail is at Question 7).

 

Stakeholders will have an opportunity to comment on a concept of operations relating to proposed new functionality and changes to the My Aged Care system. This will allow validation and refinement of concepts before changes are made to the system.  The Department will brief the sector on the My Aged Care changes through sector briefings, written materials and webinars in 2016.



 

6.     What is the best option from those considered?

 

Option A is the preferred option as it directly addresses the weaknesses in the care at home system (identified in Question 1 - What is the policy problem? ), namely:

·          limited choice and flexibility for consumers in the current care at home arrangements, including a lack of portability;

·          a high regulatory burden for service providers in applying for new home care places through the ACAR and in being becoming an approved provider under the Aged Care Act 1997 ; and

·          lack of a consistent national approach to prioritising access to home care.

 

This option is consistent with the reform directions and principles set out by the Productivity Commission, NACA, the Aged Care Sector Statement of Principles and the Aged Care Roadmap.  Overall, most stakeholders are supportive of the policy objectives associated with Option A, although some providers are concerned about the impact of greater competition on their business.

 

The changes associated with Option A will also provide the foundation for further reform of the care at home system in Stage 2, as announced by the Government in the 2015-16 Budget. 

 

Option B would provide an opportunity to bed down previous and current reforms, including CDC in home care packages, the CHSP and My Aged Care.   However, it would provide little scope for the Government to address the policy problems identified at Question 1, and would further delay reforms that stakeholders have called for over a number of years. It would not reduce the regulatory burden for providers.

 

For these reasons, and as summarised in the table below, Option A will provide the greatest net benefit to the community. The benefits of increased choice and flexibility for consumers, whilst not quantified, are greater under Option A. This option also provides a considerable net reduction in regulatory burden for providers.

 

Policy Objectives

Option A

Option B

Increase choice, portability and flexibility for consumers

Yes

No

Minimise regulatory burden on providers

Yes

Small reductions may be possible, within existing business as usual requirements.

Ensure a nationally consistent approach to prioritising access to care

Yes

No

Net regulatory cost

Saving of $4.51 m p.a.

No change

 

 



 

7.     How will you implement and evaluate the chosen option?

 

Implementation

Overall implementation of Stage 1 of the reforms is the responsibility of the Department, although some aspects will require implementation by DHS.  An Aged Care Reform Taskforce has been established within the Department to oversee and manage the implementation.

 

The implementation and evaluation of this measure (both stages) are also subject to a Department of Finance Gateway Review which provides independent assurance and advice to the Department of Health to improve delivery and implementation of the policy.

 

In order to implement Stage 1, legislative changes will be required to the Aged Care Act 1997 and the Aged Care (Transitional Provisions) Act 1997 . The Bill to introduce these changes is being introduced in early 2016. Early passage of the legislation will provide the sector with certainty about the legal requirements so that providers can make the necessary changes to management, business and operational arrangements. 

 

Following the passage of the amendments to the primary legislation, changes will also be made to the sub-ordinate legislation, including a number of the Aged Care Principles, Aged Care (Transitional Provisions) Principles and aged care determinations.  Details of these changes are expected to be available in the first few months of 2016.

 

Significant changes will be required to the IT systems and operational processes supporting My Aged Care.  It is not expected that significant changes to the DHS system will be required, with current processes for providers to claim subsidy and client income testing expected to remain unchanged.  Some minor changes to DHS processes will be necessary to recognise the assessment approval of a consumer at a specific package level (rather than a ‘broadbanded’ approval for high or low level packages) and to manage the return of the Commonwealth’s component of unspent funds when a consumer no longer requires home care.

 

Once the policy and legislative framework is settled, there will be an increased focus on communication and sector engagement activities to explain the changes and to support consumers and providers in moving to the new arrangements.  Feedback in response to the discussion paper identified a number of communication channels and formats that are preferred by consumers and providers, including face-to-face information and education sessions and a combination of web-based and print-based materials.

 

Stakeholders emphasised that the Government needs to communicate directly with consumers and their representatives, not just through providers.  Feedback indicated a variety of consumer and carer information will be needed, including targeted and accessible information and support for special needs groups.  The needs of people from culturally and linguistically diverse (CALD) backgrounds and consumers with vision impairment were particularly highlighted.

 

It was highlighted that general practitioners and other health professionals are a key information and referral source for prospective consumers and carers.  Therefore, consumer friendly information needs to be widely available to carers, providers, the assessment workforce, general practitioners and other health professionals, in addition to My Aged Care.  My Aged Care will be a key first point of information, but not the only point, for consumers and carers.

 

The recent expansion of CDC to all home care packages has demonstrated that consumers and providers require a significant amount of support in transitioning to new arrangements. The management of ‘change or reform fatigue’ will be essential.  The Department is developing a comprehensive stakeholder communication and engagement strategy based on the stakeholder feedback, and will work closely with the NACA Home Care Reforms Advisory Group on communication and transition matters.  In addition, there will continue to be opportunities for further consultation as part of the co-design process, as outlined in Question 5.

 

Evaluation

The Department will closely monitor the impact of the home care reforms following the commencement of Stage 1 in February 2017, with regular reporting to stakeholders and the public. This will include working closely with peak groups, ACFA and the NACA Home Care Reforms Advisory Group to monitor the impact of the changes on consumers and providers (both for profit businesses and not for profit organisations). 

 

The Department will particularly monitor the distribution of home care packages and waiting times to ensure that there is equitable access to care, including in rural and remote areas and for people with special needs. 

 

Existing quality assurance mechanisms, such as the Aged Care Complaints Scheme and the Australian Aged Care Quality Agency, will help to monitor the impact of the changes from a complaints and compliance perspective.

 

The Department is also developing a Benefits Realisation Plan as part of the evaluation of the measure.  The plan will build on the existing Aged Care Reform Benefits Framework and will assess the realisation of benefits for clients, aged care providers, consumers and the Commonwealth.  The independent Department of Finance Gateway Review will help to oversee that the evaluation framework is appropriate.

 

 



STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

 

Prepared in accordance with Part 3 of the

Human Rights (Parliamentary Scrutiny) Act 2011

AGED CARE LEGISLATION AMENDMENT

(INCREASING CONSUMER CHOICE) BILL 2016

 

This Bill is 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 Bill

In the 2015-16 Budget, the Government announced significant reforms to home care through the ‘Increasing Choice in Home Care’ measure.  The reforms will be implemented in two stages.

 

In the first stage, commencing February 2017, funding for a home care package will follow the consumer.  This will enable a consumer to choose a provider that is suited to them and to direct the funding to that provider.  The consumer will also be able to change their provider if they wish, including if they move to another area to live.  This Bill gives effect to the first stage of the reforms.

 

In the second stage, from July 2018, the Government intends to combine two existing programmes, the Home Care Packages Programme and the Commonwealth Home Support Programme, into an integrated care at home programme from July 2018.  This will further simplify the aged care system for consumers.

 

The changes in this Bill are an important step in moving towards an aged care system that is more consumer-driven, market-based and less regulated.

 

Human rights implications

The Bill engages the following human rights:

·          the right to an adequate standard of living;

  • the right to the enjoyment of the highest attainable standard of physical and mental health;
  • the rights of equality and non-discrimination; and
  • the right to choice for persons with disabilities.

 

The Bill promotes the right to an adequate standard of living and the right of everyone to the enjoyment of the highest attainable standard of physical and mental health as set out in Articles 11 and 12 of the International Covenant on Economic, Social and Cultural Rights.  This Bill will enable home care packages to be assigned to consumers of home care, who will be able to direct government funding to a provider of their choice.  These changes will strengthen the Home Care Packages Programme which aims to assist older people to remain living at home, and to enable consumers to have choice and flexibility in the way that their aged care and support services are provided in their home.  A home care package may include a range of co-ordinated personal care, support services, clinical care and other services tailored to meet the assessed needs of the consumer.  The Bill will also increase competition within the home care sector, leading to increased quality and innovation in the delivery of care.

 

The Bill promotes the right to equality and freedom from discrimination for older persons.  For the first time, there will be a nationally consistent approach to prioritising access to home care. This will allow a more equitable distribution of packages to consumers based on their individual needs and circumstances, regardless of where they live.  Home care packages will be portable, which will enable consumers to continue to receive care if they move to another location.

 

The Bill also promotes the rights of persons with disabilities, particularly in regard to choice and independence, as contained in Article 3(a) of the Convention on the Rights of Persons with Disabilities (CRPD). The Bill will provide older persons with disabilities with greater choice and flexibility in deciding who provides their care to meet the consumer’s needs.  For example, consumers and carers will be able to choose a service that specialises in care for people with specific needs, such as dementia care or other special needs. 

 

Conclusion

The Bill is compatible with human rights as it promotes the human rights to an adequate standard of living, the highest attainable standard of physical and mental health, the right to equality and freedom from discrimination, and the right to choice for persons with disabilities.

 

 

 

 

[The Minister for Aged Care, the Hon Sussan Ley MP]

 



AGED CARE LEGISLATION AMENDMENT (INCREASING CONSUMER CHOICE) BILL 2016

 

NOTES ON CLAUSES

 

Abbreviations used in this explanatory memorandum

 

  • The Act means the Aged Care Act 1997
  • The Transitional Provisions Act means the Aged Care (Transitional Provisions) Act 1997
  • The Red Tape Reduction in Places Management Act means the Aged Care Amendment (Red Tape Reduction in Places Management) Act 2016

 

Clause 1 sets out how the new Act is to be cited - that is, as the Aged Care Legislation Amendment (Increasing Consumer Choice) Act 2016.

 

Clause 2 provides for the whole of the new Act to commence on 27 February 2017.  However, the clause also specifies that if the Red Tape Reduction Places Management Act comes into effect before the new Act, Schedule 1, Part 2, Division 1 of the new Act will not commence at all.   Further, Schedule 1, Part 2, Division 2 will only commence if the Red Tape Reduction in Places Management Act comes into effect before the new Act commences on 27 February 2017.

 

Clause 3 provides that legislation specified in a Schedule to the Act is amended or repealed as set out in that Schedule.

 



 

SCHEDULE 1 - AMENDMENTS

 

 

Summary

 

This Schedule makes amendments to the Act and the Transitional Provisions Act to enable funding for a home care package to ‘follow’ the care recipient.  The care recipient will be able to direct the home care funding to a provider of their choice.  Home care places will no longer be allocated to an approved provider in respect of a particular location or region.

 

The amendments will create a consistent national process for prioritising access to subsidised home care.  The prioritisation process will take into account the relative needs and circumstances of care recipients, determined through the comprehensive assessment under Part 2.3 of the Act, and the time that a person has been waiting for care.

 

The amendments will simplify the approval process for approved providers.  The legislative criteria used to assess the suitability of a person to become an approved provider will be streamlined. This will also provide for a simplified process for residential care and flexible care providers to become approved providers of home care.  An organisation’s approval to provide home care will commence as soon as the approval is granted and will not lapse.  Currently, approved provider status lapses after two years if the provider does not hold an allocation of places.  The lapsing provision will be removed across all care types - home care, residential care and flexible care.

 

This Schedule also makes minor changes to the eligibility of care recipients for aged care services, and varies the Secretary’s delegation powers under the Act and the Transitional Provisions Act.

 

There are transitional and application provisions to ensure continuity of services for existing care recipients of home care and the effective administration of the reforms.

 

 

 

 

 

 



 

Explanation of the changes

 

 

Part 1 - Amendments

 

Amendments to the Aged Care Act 1997

 

Item 1: Paragraph 3-2(b)

Section 3-2 outlines the approvals or decisions that may need to have been made under Chapter 2 of the Act before the Commonwealth can pay subsidy to an approved provider.  This item amends paragraph 3-2(b) to clarify that only residential care services and flexible care services are required to have places allocated as a condition of eligibility for subsidy.  

           

Item 2: Section 5-1

Section 5-1 explains what Chapter 2 of the Act is about and also outlines a number of approvals and decisions that may need to have been made before the Commonwealth can pay subsidy to an approved provider.  This item amends section 5-1 to clarify that places will now only be allocated in respect of residential care and flexible care services.  The item also clarifies that for home care, care recipients must be prioritised to receive home care under the proposed Part 2.3A of the Act.

 

Item 3: Section 5-2 (table item 2, column headed “Home Care Subsidy”)

Section 5-2 sets out the approvals that are required under the Act before a person can receive subsidy for a type of aged care.  This item amends table item 2 to clarify that an allocation of places is not required in order to receive a home care subsidy under Chapter 3 of the Act or Chapter 3 of the Transitional Provisions Act.  An allocation of places will continue to be a requirement in order to receive residential care subsidy or flexible care subsidy.

 

Item 4: Section 5-2 (after table item 3)

This item also amends section 5-2 to insert table item 3A into the table.  Table item 3A clarifies that the prioritisation of home care recipients is now required before an approved provider is eligible to receive subsidy for the provision of home care.

 

Item 5 and 6: Paragraph 8-1(2)(b)

This item amends paragraph 8-1(2)(b), which provides that an approval as a provider of care is in respect of each service that has an allocation of a place, or a provisionally allocated place.  The changes in this item clarify that this paragraph only applies to residential and flexible care services as there will no longer be an allocation of places or provisionally allocated places in respect of home care services.

 

This item also makes changes to clarify that subparagraphs 8-1(2)(b)(i) and (ii) only apply to residential care and flexible care services.

 

Item 7: At the end of subsection 8-1(2)

This item inserts a new paragraph (c) into subsection 8-1(2) to provide that approval of a provider of home care is in respect of each home care service the approved provider notifies the Secretary of under section 9-1A.  The intent of this paragraph is to limit the provider’s approval to those home care services that have or will be notified to the Secretary by the provider.

 

This item will operate in a similar way to current paragraph 8-1(2)(b), which limits a provider’s approval to services that have an allocation (or provisional allocation) of places. As discussed under items 5 and 6, paragraph 8-1(2)(b) will continue to operate in relation to providers approved for residential care and flexible care.

 

Item 8: Subsections 8-1(3) and 8-1(4)

This item repeals subsections 8-1(3) and (4).  Subsection (3) currently provides that an approval for an aged care service will only come into force once an allocation of a place or a provisional allocation of a place is made.  Subsection (4) further clarifies when an approval will come into force under subsection (3).

 

Instead, a new subsection 8-1(3) will provide that an approval begins to be in force on the day of the Secretary’s decision to approve the provider under subsection 8-1(1). The date of the decision will be notified to the provider under paragraph 8-5(1)(aa). 

 

This item applies to the approval of providers across all types of care (residential care, flexible care and home care).

 

Item 9: Subsection 8-3(1)

Subsection 8-3(1) sets out the matters the Secretary must consider when deciding if an applicant is suitable to be approved as a provider of aged care.  

 

This item simplifies the criteria used by the Secretary to assess an organisation’s suitability to become an approved provider for all types of care.  These criteria will have a greater focus on the capacity of the organisation as a whole to deliver the type of care for which approval is sought and less focus on key personnel, who may change over time.

                                                          

The revised matters the Secretary must take into consideration are:

  • the applicant’s experience in providing aged care or other relevant forms of care; and
  • whether the applicant has demonstrated understanding of its responsibilities for the type of care being applied for; and
  • systems the applicant has, or proposes to have to meet its responsibilities as a provider of the type of care for which approval is sought; and
  • the applicant’s record of financial management, as well as the applicant’s methods, or proposed methods, to ensure sound financial management; and
  • the applicant’s conduct as an approved provider, and its compliance with its any obligations that have arisen from the receipt of any payment from the Commonwealth for providing aged care; and
  • any matters specified in the Approved Provider Principles.

 

The Secretary will retain the power to consider the organisation’s key personnel in relation to the matters specified in subsection 8-1(2), where considered relevant.

 

By simplifying the matters the Secretary must consider when approving an entity as an approved provider, this item will streamline the process through which an entity may apply for approval as a provider of aged care. Current administrative processes, including the application form to become an approved provider, will also be reviewed and streamlined.

 

The application process for existing residential care and flexible care providers to be approved as home care providers will also be streamlined, significantly reducing red tape for these providers.  This recognises that these providers have already been tested against the standards required to become an approved provider of aged care.  Providers applying through this process will be required to demonstrate their ability to meet the criteria as they specifically relate to home care.

 

All approved providers must continue to meet relevant quality and accreditation standards.

 

Item 10: Subsection 8-3(2)

Subsection 8-3(2) specifies that, in considering the suitability of an applicant under subsection 8-3(1), the Secretary may also consider a number of matters in relation to the applicant’s key personnel.

 

This item makes consequential changes to subsection 8-3(2) to reflect the changes made by item 9.

 

Item 11: Subsection 8-3(5)

Subsection 8-3(5) provides that the Approved Provider Principles may specify matters that the Secretary must have regard to when considering the matters under subsection 8-3(1).

 

This item makes consequential changes to subsection 8-3(5) to reflect the changes made by item 9.

 

Item 12: Subsection 8-3(6)

This item makes consequential changes to subsection 8-3(1) to reflect the changes made by item 9.

 

Item 13: Subsection 8-3(6A)

Subsection 8-3(6A) clarifies the concept of relevant key personnel in common, as referred to paragraph in 8-3(1)(ga).  This item repeals subsection 8-3(6A), which is no longer required as paragraph 8-3(1)(ga) will be removed by item 9.

 

Item 14: Before paragraph 8-5(2)(a)

Subsection 8-5(2) sets out the matters that a notice made under subsection 8-5(1) must include.  This item inserts a new paragraph 8-5(2)(aa), which requires a notice made under subsection 8-5(1) to include the day the applicant was approved as a provider of aged care.  This amendment is needed due to changes made by item 8, which provides that an approval as a provider of aged care will begin on the day the approval is given.

 

Item 15: Paragraph 8-5(2)(b) 

This item makes consequential changes to paragraph 8-5(2)(b) which are required as a result of changes made by item 14.

 

Item 16: Paragraph 8-5(2)(d)

Subsection 8-5(2) sets out the matters a notification of approval to provide aged care must include.  Paragraph 8-5(2)(d) requires that a notification must include the places that have been allocated, or provisionally allocated.  This item amends paragraph 8-5(2)(d) to clarify that this requirement does not apply to home care services.

 



 

Item 17: Subparagraphs 8-5(2)(d)(i) and 8-5(2)(d)(ii)

Subparagraphs 8-5(2)(d)(i) and 8-5(2)(d)(ii) provide that a notification made under subsection 8-5(1) must include a statement regarding the allocation of places or provisional places the approval is in respect of.  This item makes amendments to subparagraphs 8-5(2)(d)(i) and 8-5(2)(d)(ii) to clarify these obligations only apply in relation to a notification relating to residential care or flexible care.

 

Item 18: Paragraph 8-5(2)(da)

This item repeals paragraph 8-5(2)(da), which provides that a notification made under section 8-5 must state that an approval will not come into force unless an allocation or provisional allocation is made in respect of the aged care service in question.  This is because the approval will come into force on the date of approval under subsection 8-1(3) - explained under item 8.

 

A new paragraph, paragraph 8-5(2)(da) will be inserted to provide that, for an approval in respect of home care, a notification under subsection 8-5(1) must provide that an approval is in respect of each home care service which the person notifies the Secretary of, in accordance with section 9-1A.  This amendment is needed due to item 7, which provides that an approval under section 8-1 for a home care provider is in respect of each home care service notified under section 9-1A.

 

This item is not intended to limit the approval of a provider to the home care services that have been notified at the time that the approval is given.  An approved provider of home care can notify the Secretary of any new or varied services at a later date.  

 

Item 19: Paragraphs 8-5(2)(e) and 8-6(2)(a)

This item repeals paragraph 8-5(2)(e), which provides that a notification made under section 8-5 must specify the circumstances in which an approval will lapse under section 10-2.  As part of these reforms, approvals will no longer lapse. 

 

This item also repeals paragraph 8-6(2)(a), which provides that an approval made under section 8-6 will no longer be in force if it lapses under section 10-2.

 

Item 20: New section 9-1A: Notification of home care services

New section 9-1A will require an approved provider of home care to notify the Secretary of each home care service through which it proposes to provide home care.  Subsection (1) requires the approved provider to notify the Secretary of:

  • the name and address of the service; and
  • any other information that may be specified in the Approved Provider Principles.

 

The kind of additional information that may be specified in the Approved Provider Principles includes an email address and telephone number for the service and other operational information required for the Secretary to effectively administer the Act and the Transitional Provisions Act. 

 

Providers currently provide information about home care services to the Secretary when applying for home care places through the Aged Care Approvals Round.  The  new section 9-1A will enable the same type of information to be provided to the Secretary in the future. 

 

Subsection (2) provides that the notification must be made before the approved provider provides home care through the home care service.  The notification of the service under this section is also a requirement for the eligibility for home care subsidy under paragraph 46-1(1)(c).

 

Subsection (3) provides that the notification must be made in a form approved by the Secretary.  Subsection (4) states that if there is a change in any of the information notified in subsection (1), the approved provider must notify the Secretary of that change within 28 days.

 

It is intended that there will be a simple administrative mechanism for providers to provide and update this information to the Secretary, for example, through a provider portal in the My Aged Care system.

 

Failure to comply with the requirements of section 9-1A will be a breach of the approved provider’s responsibilities under Chapter 4 of the Act. 

 

There are transitional provisions under item 72 that provide for an approved provider operating a home care service before commencement of this Schedule to be taken to have discharged its obligations to notify the Secretary under section 9-1A. 

 

Item 21: Subsection 9-1(3B) and 9-2(2A)

Subsection 9-1(3B) provides that an approved provider has an obligation to notify the Secretary of changes listed in subsection 9-1(1) even if an approval is not yet in force because a place has not been allocated or provisionally allocated.  This item repeals subsection 9-1(3B), which is no longer needed because approvals will now come into force for all types of care once approved by the Secretary, regardless of whether a place has been allocated.

 

Item 21 also repeals subsection 9-2(2A).  Subsection 9-2(2A) specifies that an approved provider has an obligation to provide the Secretary with certain information relating to the approved provider’s suitability to provide aged care under subsection 9-2(1), even if an approval is not yet in force because a place has not yet been allocated, or provisionally allocated.  This subsection is no longer required as approvals will now come into force regardless of whether a place has been allocated.

 

Item 22: Paragraph 10-1(1)(a)

Paragraph 10-1(1)(a) provides that an approval of a provider to provide aged care ceases to have effect if it lapses under section 10-2.  This item repeals paragraph 10-1(1)(a) as a consequence of section 10-2 being repealed.

 

Item 23: Section 10-2

Section 10-2 sets out the circumstances in which an approval of a person as a provider of aged care will lapse.  This item repeals section 10-2, as approvals will no longer lapse if there is no allocation of places. 

 

Currently, approved provider status will lapse after two years if the provider does not have an allocation of places within that period.  Removing the concept of allocated home care places will mean that the lapsing provision will no longer be relevant to home care. 

 

To provide consistency and simplify the regulatory arrangements, this change (removing the lapsing provision) will apply to all types of care - i.e. residential care, flexible care and home care.  Feedback from stakeholders during the consultations on the home care reforms supported this change.

 

All approved providers must continue to meet relevant quality and accreditation standards.

 

Item 24: Section 11-1

Section 11-1 explains what Part 2.2 of the Act is about.  The amendment in this item explains that the requirement for an approved provider to have an allocation of places in order to receive subsidy will only apply to residential care and flexible care.

 

Items 25, 26, 27, 28, 29, 30, 31 and 32: Sections 11-4, 12-1, 12-3, 12-4, 12-5, 12-6, 14-1, 16-2 and 18-5  

Various provisions in Part 2.2 of the Act refer to home care.  These provisions have been amended to make clear that the allocation process will only apply to residential care and flexible care.  In particular, amendments have been made to the following provisions of the Act:

  • section 11-4;
  • subsection 12-1(1);
  • subsection 12-3(1);
  • subsection 12-4(1);
  • subsection 12-4(3);
  • subsection 12-5(1);
  • subsection 12-6(1)
  • subsection 12-6(2);
  • subsection 14-1(1);
  • paragraphs 16-2(4)(a); and
  • paragraph 18-5(1)(b).

 

Item 33: Section 21-1

Section 21-1 explains that a person is eligible to be approved as a care recipient if that person is eligible to receive residential care, home care or flexible care.  This item amends section 21-1 to allow the Secretary to approve a person as eligible for approval for more than one type of care.

 

In practice, a person seeking aged care services may be assessed by an Aged Care Assessment Team (ACAT) for various types of care.  This amendment will allow the Secretary to approve a person as eligible for more than one type of care, reducing the need for additional assessments and approvals for the care recipient.

 

Item 34: Paragraphs 21-1(a) and 21-1(b)

This item amends paragraphs 21-1(a) and 21-1(b) to further clarify that a person is eligible for approval for more than one type of care.

 

Item 35: Paragraph 21-2(b)

Paragraph 21-2(b) provides that a condition of eligibility to receive residential care is that a person has needs that cannot be met more appropriately through non-residential care services. 

 

This item varies paragraph 21-2(b) to clarify that a person is eligible to receive residential care if that person has needs which can be met appropriately through residential care services.  As such, the amendment makes clear that a person who is eligible for residential care may also be eligible for other types of care.

 

Item 36: Paragraph 21-3(a)

Paragraph 21-3(a) lists the various types of needs a person must have to be eligible for home care.  This item amends paragraph 21-4(a) to clarify that a person may be eligible for home care if that person has medical needs.

 

Item 37: Paragraph 21-3(b)

Paragraph 21-3(b) provides that a person may be eligible for home care if that person has needs (as specified in paragraph 21-3(a)) that can be met appropriately through non-residential care services.  This item amends paragraph 21-3(b) to provide that a condition of eligibility for home care is that the needs specified in paragraph 21-3(a) can be met appropriately through home care services. 

 

Item 38: Paragraph 21-4(a)

Paragraph 21-4(a) lists the various types of  needs a person must have to be eligible for flexible care.  This item amends paragraph 21-4(a) to clarify that a person may be eligible for flexible care if that person has medical needs.

 

Item 39: New Section 22-2A

New section 22-2A provides for a person to be given a ‘priority for home care services’ by the Secretary. This will form part of the person’s assessment of care needs under section 22-4.

 

A person’s priority for home care services will be largely based on information obtained through the comprehensive assessment undertaken by an ACAT in accordance with a clinical framework.  Once determined, a person’s priority for home care services will be one of the matters considered in the operation of the national prioritisation process (as set out in the new Part 2.3A of the Act, in particular, paragraphs 23B-1(4)(b) and 23B-2(4)(b)).

 

Subsection (1) provides that if a person is approved as a recipient of home care, the Secretary must determine the person’s priority for home care services.

 

Subsection (2) allows the Secretary to vary a determination made under subsection (1).

 

Subsection (3) provides that any determination made under subsection (1) or (2) must be consistent with a person’s care needs, as determined under section 22-4. 

 

Determinations made under subsection (1) and (2) will be reviewable under section 85-1 of the Act - see item 51. 

 

Item 40: Subsection 22-4(2)

Subsection 22-4(2) provides that when assessing a person’s care needs, the Secretary may limit the assessment to specific levels or types of care.  This item amends subsection 22-4(2) to provide that when limiting a person’s care needs under subsection 22-4(2), the Secretary must have regard to subsection (2A) (as added by item 41).

 

Item 41: After subsection 22-4(2)

This item inserts a new subsection (2A) into section 22-4.  New subsection (2A) provides that any assessment of a person’s care needs must include an assessment of the person’s priority for home care services (made under section 22-2A). 

 

Item 42: After paragraph 22-6(2)(c)

The Secretary is required by subsection 22-6(1) to notify a person of whether they have been approved as a care recipient.  Subsection 22-6(2) sets out the statements the notice made under subsection 22-6(1) must include.  This item inserts paragraph 22-6(2)(ca) which requires that, if the person is approved for home care, the notice must include a person’s priority for home care services.    

 

Item 43: At the end of subsection 22-6(3)

Subsection 22-6(3) provides that the Secretary must notify an approved care recipient of changes made to the care recipient’s approval.  This item inserts paragraph 22-6(3)(c) which requires the Secretary to notify the approved care recipient if the Secretary varies the care recipient’s priority for home care services under subsection 22-2A(2).

 

Item 44: New Part 2.3A

New Part 2.3A sets out the process for the prioritisation of home care recipients.  This is a new process being introduced as part of the first stage of the home care reforms. 

 

The introduction of a consistent national system for prioritising access to subsidised home care will allow for a more equitable and flexible distribution of home care packages to care recipients based on individual needs and circumstances, regardless of where they live.

 

It will also enable the Secretary to control the number of care recipients that are prioritised for home care and the level of home care, within the decision-making framework set out in the Act.  This is important because the number of home care packages at different levels will continue to be capped or limited.

 

In determining the number of care recipients who can be prioritised for packages, the Secretary will continue to work within the Government’s policy parameters of the aged care planning ratio and the forward estimates.  The current planning target is 45 home care places (packages) per 1,000 people aged 70 years and over by 2021-22.

 

The Secretary will give a written notice to a prioritised home care recipient (under subsection 23B-1(1)).  A provider will only be eligible to claim home care subsidy if the care recipient is a prioritised home care recipient (under paragraph 46-1(1)(d)) and the other conditions specified in section 46-1 are satisfied.

 

New section 23A-1 gives an overview of Part 2.3A.  Section 23A-1 explains that a person must be determined to be a prioritised home care recipient before an approved provider can be paid home care subsidy for providing care to that person.

 

New section 23B-1 provides that the Secretary may, by written notice, determine that a person is a prioritised home care recipient.  Specifically, subsection (1) allows the Secretary to determine:

  • that the person is a prioritised home care recipient; and
  • the person’s level of care as a prioritised home care recipient.

 

Subsection (2) provides that the level of care a person the Secretary has determined a person may receive under subsection (1) may differ from, but cannot be higher than, the level of home care a person has been approved to receive under subsection 22-2(3). 

 

This will enable a care recipient to receive subsidised home care at a lower level, as an interim arrangement, while waiting for a higher level package to become available.  A person who has been prioritised for home care at a lower level will remain on the prioritisation queue (national waiting list) until a higher level package is available.

 

Subsection (3) provides that a determination made under subsection (1) takes effect on the day that it is made.

 

Subsection (4) specifies the criteria the Secretary must take into account when deciding whether to make a determination under subsection (1).  The Secretary must consider the following:

  • the period of time the person has been waiting to receive home care.  This  period of time will be measured from the day the person was approved under Part 2.3 of the Act, or otherwise specified in the Prioritised Home Care Recipient Principles;
  • the person’s priority for home care services as determined under section 22-2A; and
  • any other matters specified in the Prioritised Home Care Recipient Principles.

 

Paragraph 23B-1(4)(a) requires the Secretary to consider the period of time that the person has been waiting to receive home care.  In most cases, this will be from the date that the person has been approved as eligible for home care (i.e. following assessment by an ACAT).  It is intended that the Prioritised Home Care Recipient Principles will also specify a later day to provide flexibility for an approved care recipient who is not actively seeking care at the time of the assessment approval.  For example, a person may not wish to have their name placed on the national waiting list immediately, but they will be able to advise the Secretary at a later date that they wish to join the waiting list.

 

Paragraph 23B-1(4)(c) will enable other matters that the Secretary must consider in making a determination under subsection (1) to be specified in the Prioritised Home Care Recipient Principles, should there be a need to address additional or unforeseen matters in the prioritisation process.  If any other matters are specified in the future, the matters would relate to objective factors, rather than factors that involve subjective discretion.

 

Subsection (5) allows the Secretary to make a determination under subsection (1) with reference to exceptional circumstances in addition to the criteria provided in subsection (4).

 

The kinds of exceptional circumstances envisaged under subsection (5) include emergency care situations or instances of market failure (e.g. where individuals or groups of people are not able to access care in an appropriate and timely manner).  It is intended that decision-making under subsection (5) would only be used in limited circumstances.  Decisions would be made by the Secretary, or a delegate at the SES officer level within the Department.

 

Subsection (6) is included to clarify that a determination made under subsection (1) is not a legislative instrument within the meaning of section 5 of the Legislative Instruments Act 2003 , and is merely declaratory of the law.  A determination under subsection (1) is not legislative in nature.

 

A decision made by the Secretary under subsection (1) is not a reviewable decision under section 85-1, meaning this decision is not subject to merits review.  This is appropriate in light of the factors the Secretary must take into account under the proposed subsection (4) when making a determination.  In particular:

·          in deciding whether a person is a prioritised home care recipient under section 23B-1, the Secretary must consider the priority for home care services assigned to the person under section 22-2A.  Decisions relating to the priority for home care services made under section 22-2A are reviewable under section 85-1;

·          the other key factor the Secretary must consider is the time a person has waited to receive subsidised home care.  Merits review is not appropriate in this case, as waiting time is objectively determined and does not require the exercise of discretion by the Secretary; and

·          the decision to prioritise a care recipient is a decision to allocate a finite resource (home care packages) between competing applicants (eligible care recipients) for which merits review is generally considered inappropriate.  Given the limited number of home care packages available, the overturning of a decision not to prioritise an individual on merits review would naturally affected the rights of a person in respect of whom a determination has been made under Division 23B.

 

New section 23B-2 allows the Secretary to vary the level of care in relation to which a person has been assigned as a prioritised care recipient.  It will operate in a similar manner to section 23B-1 which allows the Secretary to provide the notice to a prioritised home care recipient.

 

Subsection (1) provides that the Secretary, by written notice, may vary a determination to increase the person’s level of care as a prioritised care recipient.  As a result, a determination under subsection 23B-1(1) as to a person’s level of care as a prioritised home care recipient cannot be varied to decrease the level of care.

 

Similar to subsection 23B-1(2), subsection 23B-2(2) provides that the level of care the Secretary has determined a person may receive under subsection (1) may differ from, but cannot be higher than, the level of home care a person has been approved to receive under subsection 22-2(3). 

 

This will enable a care recipient to receive subsidised home care at a lower level, as an interim arrangement, while waiting for a higher level package to become available.  A person who has been prioritised for home care at a lower level will remain on the prioritisation queue (national waiting list) until a high level package is available.

 

Subsection (3) provides that the variation takes effect on the day the variation is made.

 

Subsection (4) sets out the criteria the Secretary must consider before making a variation under subsection (1).  These criteria are:

  • the period of time the person has been waiting to receive home care.  This  period of time will be measured from the day the person was approved under Part 2.3 of the Act, or otherwise specified in the Prioritised Home Care Recipient Principles;
  • the person’s priority for home care services as determined under section 22-2A; and
  • any other matters specified in the Prioritised Home Care Recipient Principles.

 

Subsection (5) allows the Secretary to make a determination under subsection (1) with reference to exceptional circumstances in addition to the criteria in subsection (4).

 

Subsections 23B-2(4) and (5) will operate in a similar manner to subsections 23B-1(4) and (5) - as explained above.

 

A notice made under this section is not a legislative instrument because it amends an instrument made under section 23B-1, which itself is not a legislative instrument.

 

New section 23B-3 outlines the circumstances in which a determination made under subsection 23B-1(1) that a person is a prioritised home care recipient will cease to have effect.  These circumstances are if:

  • the person dies; or
  • the person’s approval as a recipient of home care ceases to have effect; or
  • the person is not provided with home care for an amount of time specified in the Prioritised Home Care Recipients Principles; or
  • the person ceases to be provided with home care.  The circumstances in which a person will have been taken to have ceased being provided with care may be outlined in the Prioritised Home Care Recipients Principles.

 

Paragraph 23B-3(c) will allow for a reasonable period of time for a person (who has been notified as a prioritised home care recipient) to commence in a home care package.  The period of time and the circumstances in which it may be extended will be specified in the Prioritised Home Care Recipients Principles.  The intention is to provide a person with sufficient time to choose their provider without being rushed, but if the person does not take up care after a period of time despite having reasonable opportunity to do so, the notification under subsection 23B-1(1) would cease. In practice, My Aged Care would seek to contact and understand why the person has not taken up care before the notice ceases.

 

The type of circumstances that may be outlined in the Prioritised Home Care Recipients Principles under paragraph 23B-3(d) include where the care recipient has permanently entered residential care, or where the care recipient has notified the Secretary that they have ceased home care.

 

New section 23B-4 deals with the situation where the Secretary arranges for a computer program to generate a decision for the purposes of making or varying a decision under Division 23B.  It is expected that the written notice, advising that a person is a prioritised home care recipient or varying an existing notice, will be generated by the My Aged Care system.  

 

Where this happens, the computer decision is taken to be a decision of the Secretary.  This section will ensure the Secretary is accountable for any computer-generated decisions made under Division 23B.

 

Subsection 23B-4(3) allows the Secretary to substitute a decision made by the operation of a computer program (in this case, the My Aged Care system) if the Secretary is satisfied that the initial decision was incorrect.  There will be quality assurance processes to ensure that systems are operating correctly.  If any decisions are made in error, they will be identified and substituted quickly.

 

As explained above, decisions involving exceptional circumstances made under subsections 23B-1(5) or 23B-2(5) will be made by the Secretary or a delegate at the SES officer level within the Department.

 

Item 45: Section 40-1

Section 40-1 explains what Chapter 3 is about and outlines the subsidies payable under that Chapter.  This item amends section 40-1 to clarify that while residential care and flexible care providers are required to receive an allocation of places before receiving subsidy for the provision of care, home care providers are no longer required to receive an allocation of places before receiving subsidy.

 

Item 46: At the end of section 45-1

Section 45-1 explains that Part 3.2 is about the payment of home care subsidy.  This item amends section 45-1 to clarify that any unspent home care amount, which may include unspent home care subsidy, must be dealt with by an approved provider in accordance with the User Rights Principles.

 

Item 47: Section 46-1

Section 46-1 sets out the eligibility criteria that an approved provider must meet to receive home care subsidy in respect of a day.  This item amends section 46-1 as a result of the removal of allocated places for home care (which was previously a condition of eligibility for home care subsidy) and the new portability requirements.

 

Subsection (1) sets out the new criteria the Secretary must be satisfied have been met for every day that the approved provider claims home care subsidy.  The criteria are as follows:

  • the approved provider is approved to provide home care under Part 2.1 of the Act; and
  • there is in force a home care agreement under which a care recipient approved under Part 2.3 of the Act is to be provided home care by the approved provider through a home care service; and
  • the home care service providing the care is a notified home care service; and
  • the care recipient has been notified that they are a prioritised care recipient under Part 2.3A of the Act; and
  • the care recipient is provided with care in accordance with the home care agreement; and
  • the approved provider has agreed to deal with the care recipient’s unspent home care amount in accordance with the User Rights Principles. 

 

Subsection (2) clarifies that a notified home care service, as referred to in subsection (1), is a service which an approved provider has notified the Secretary of under the proposed section 9-1A.

 

Item 48: Section 46-3

Subsection 46-3(1) provides that home care provided to a care recipient is excluded from eligibility for subsidy if the number of recipients receiving care exceeds the number of places for which the approved provider has an allocation of places.  Subsection 46-3(2) sets out the matters that the Secretary must consider in deciding which home care agreement is to be excluded.  This item repeals section 46-3, which is no longer required as there will no longer be any allocation of places in relation to home care.

 

Item 49: Paragraph 56-2(f)

Paragraph 56-2(f) requires an approved provider of home care to provide such security of tenure for the care recipient’s place in the service, as is specified in the User Rights Principles.  As the concept of places will no longer apply to home care, this item varies paragraph 56-2(f) to clarify that an approved provider is still required to provide security of tenure for the care recipient to receive home care through the service in accordance with the User Rights Principles.

 

Item 50: Paragraph 63-1(1)(c)

Paragraph 63-1(1)(c) requires an approved provider to notify the Secretary of certain changes relating to approved provider status.  This item varies paragraph 63-1(1)(c) to require an approved provider to comply with its obligations in Division 9 in relation to notifying and providing information.  This amendment ensures that the approved provider’s obligation to notify the Secretary of all new services created under section 9-1A will be a responsibility under Chapter 4 of the Act.

 

Section 51: Section 85-1 (after table item 25)

Section 85-1 provides that specified decisions under the Act are reviewable decisions (subject to internal reconsideration and to review by the Administrative Appeals Tribunal).  The reviewable decisions are itemised in a table which includes a description of the relevant decision and indicates the provision of the Act under which the decision is made.

 

This item amends section 85-1 to provide that a decision under subsection 22-2A(1) to determine a person’s priority for home care services, and a decision under subsection 22-2A(2) to vary a person’s priority for home care services are both reviewable decisions.

 

Item 52: Paragraph 86-9(1)(b)

Paragraph 86-9(1)(b) allows the Secretary to publish the number of places in an aged care service.  This item amends paragraph 86-9(1)(b) to reflect that places will no longer be allocated for home care.

 

Item 53: Paragraph 86-9(1)(ba)

This item amends subsection 86-9(1) by inserting paragraph 86-9(1)(ba).  Paragraph 86-9(1)(ba) will allow the Secretary to publish the number of care recipients being provided with care through a home care service. 

 

Item 54: Section 95-1

Section 95-1 provides that a ‘recoverable amount’ is any part of an amount paid to a person way of subsidy under Chapter 3 that is an overpayment, or an amount paid to a person by way of a grant under Chapter 5 where a condition to which the grant is subject is not met.

 

This item adds a new subsection (3) which provides that an unspent home care amount is a recoverable amount where:

  • it relates to an amount (home care subsidy and/or fees) paid to the approved provider;
  • after the commencement of this Schedule, the approved provider has been paid home care subsidy in respect of the care recipient (regardless of whether the unspent home care amount relates to that subsidy payment); and
  • the Commonwealth portion is not otherwise payable to another home care provider under the User Rights Principles. 

 

This will provide a mechanism for the Commonwealth’s portion of the unspent funds in a home care package to be returned to the Commonwealth when a home care recipient permanently leaves home care.  This subsection should be read in conjunction with paragraph 46-1(1)(f) of the Act and the Transitional Provisions Act and item 79.

 

As explained in item 59, the details of the arrangements relating to unspent home care amounts will be further set out in the User Rights Principles.

 

Item 55: Section 96-1 (table item 5)

Section 96-1 describes the Aged Care Principles that may be made by the Minister.  The Principles are legislative instruments within the meaning of section 5 of the Legislative Instruments Act 2003 .

 

This item amends table item 5 of section 96-1, which will allow the Minister to make Principles in respect of the matters outlined in Part 2.3A, to be known as the Prioritised Home Care Recipient Principles.

 

Item 56: Subsection 96-2(1)

Section 96-2 sets out the various functions and powers the Secretary may delegate in order to facilitate the administration of the Act.  Subsection 96-2(1) provides that the Secretary can delegate in writing to officers of the Department any or all of the powers the Secretary has under the Act.  This item broadens subsection 96-2(1) so the Secretary may delegate to a person engaged by:

  • an Agency (within the meaning of the Public Service Act 1999 ); or
  • an authority of the Commonwealth.

 

There are similar provisions in the Social Security (Administration) Act 1999 and the Paid Parental Leave Act 2010 to allow for the efficient administration of Government funded support programmes.  As in those cases, and given the increased volume of decisions made under the Act as a result of these amendments, it may not always be viable to limit the delegations to Departmental officers.  As such, this provision will allow for efficient administration of the Act, particularly during peak periods of work where contractors may be required. 

 

Item 57: Clause 1 of Schedule 1

This item amends the Dictionary of the Act to provide that the term Commonwealth portion of a care recipient’s unspent home care amount has the meaning given by the User Rights Principles.

 

Item 58: Clause 1 of Schedule 1 (definition of place)

Place is currently defined in the Dictionary to the Act as applying to home care.  This item varies the definition of place to ensure that it does not apply to home care.

 

Item 59: Clause 1 of Schedule 1

This item adds a definition of the term prioritised home care recipient to the Act.  A prioritised home care recipient is defined as a person in relation to whom a determination under section 23B-1 has been made.  This definition is needed because as part of the changes, subsidy for the provision of home care can only be provided to a prioritised care recipient.

 

This item also adds a definition of the term unspent home care amount of a care recipient. It will have the meaning given by the User Rights Principles. 

 

As explained in the overview to this explanatory memorandum, once these changes take effect, funding for a home care package will ‘follow the consumer’ (care recipient). Portability of funding is a key element in ensuring that a consumer is able to change their provider if they wish to do so.  This is consistent with the policy intent of the home care reforms that the package ‘belongs to the consumer’ and will minimise financial disincentives to a consumer changing providers.

 

It is intended that when a home care recipient moves between approved providers of home care, the unspent home care amount (subsidy and/or fees paid by care recipient less any administrative charges) will move with the care recipient to the new home care provider.  Where a care recipient permanently leaves home care, provision will also be made for unspent funds to be returned to the care recipient (or their estate) and the Commonwealth according to respective contributions made by each party.  The proposed implementation arrangements have been discussed with stakeholders, including representatives of consumers and providers, as part of a co-design approach.  

 

There is considerable complexity in defining unspent home care amounts and how these amounts will be treated under different scenarios.  Given this, the details of the approach to dealing with unspent funds will be set out in the User Rights Principles. 

 

In order to be eligible for home care subsidy, under new paragraph 46-1(f), an approved provider must agree to deal with unspent home care amounts in accordance with the User Rights Principles. 

 

The amendments to the User Rights Principles would be subject to full Parliamentary scrutiny according to the usual legislative requirements.

 

Aged Care (Transitional Provisions) Act 1997

 

Item 60: Paragraph 3-2(b)

Section 3-2 outlines the approvals or decisions that may need to have been made under Chapter 2 of the Act before the Commonwealth can pay subsidy to an approved provider for the provision of care.  This item amends paragraph 3-2(b) to clarify that only residential care services and flexible care services are required to have places allocated to be eligible for subsidy.

 

Item 61: Section 40-1

Section 40-1 explains what Chapter 3 is about and outlines the subsidies payable under that Chapter.  This item amends section 40-1 to clarify that while residential care and flexible care providers are required to receive an allocation of places before receiving subsidy for the provision of care, home care providers are no longer required to receive an allocation of places before receiving subsidy.

Item 62: Section 45-1

Section 45-1 explains that Part 3.2 is about the payment of home care subsidy.  This item amends section 45-1 to clarify that any unspent home care amount, which may include unspent home care subsidy, must be dealt with by an approved provider in accordance with the User Rights Principles.

 

Item 63: Section 46-1

Section 46-1 sets out the eligibility criteria that an approved provider must meet to receive home care subsidy in respect of a day.  This item amends section 46-1 to take into account the removal of allocated places for home care from the Act (which was previously a condition of eligibility for home care subsidy) and the new portability requirements.

 

Subsection (1) sets out the new criteria the Secretary must be satisfied have been met for every day that the approved provider claims home care subsidy.  The criteria are as follows:

  • the approved provider is approved to provide home care under Part 2.1 of the Act; and
  • there is in force a home care agreement under which a care recipient approved under Part 2.3 of the Act is to be provided home care by the approved provider through a home care service; and
  • the home care service providing the care is a notified home care service; and
  • the care recipient has been notified that they are a prioritised care recipient under Part 2.3A of the Act; and
  • the care recipient is provided with care in accordance with the home care agreement; and
  • the approved provider has agreed to deal with the care recipient’s unspent home care amount in accordance with the User Rights Principles. 

 

Subsection (2) clarifies that a notified home care service, as referred to in subsection (1), is a service which an approved provider has notified the Secretary of under the proposed section 9-1A of the Act.

 

Item 64: Section 46-3

Subsection 46-3(1) provides that home care provided to a care recipient is excluded from eligibility for subsidy if the number of recipients receiving care exceeds the number of places for which the approved provided has an allocation of places.  Subsection 46-3(2) sets out the matters that the Secretary must consider in deciding which home care agreement is to be excluded.  This item repeals section 46-3, which is no longer required as there will no longer be any allocation of places in relation to home care.

 

Item 65: Subsection 96-2(1)

Section 96-2 sets out the various functions and powers that the Secretary may delegate in order to facilitate the administration of the Transitional Provisions Act.  Subsection 96-2(1) provides that the Secretary can delegate in writing to officers of the Department any or all of the powers the Secretary has under the Transitional Provisions Act.  This item broadens subsection 96-2(1) so the Secretary may delegate to a person engaged by:

  • an Agency (within the meaning of the Public Service Act 1999 ); or
  • an authority of the Commonwealth.

 

There are similar provisions in the Social Security (Administration) Act 1999 and the Paid Parental Leave Act 2010 to allow for the efficient administration of Government funded support programmes.  As in those cases, and given the increased volume of decisions made under the Transitional Provisions Act as a result of these amendments, it may not always be viable to limit the delegations to Departmental officers.  As such, this provision will allow for efficient administration of the Transitional Provisions Act, particularly during peak periods of work where contractors may be required.

 

Item 66: Clause 1 of Schedule 1 (definition of place)

Place is currently defined in the Dictionary to the Transitional Provisions Act as applying to home care.  This item varies the definition of place to ensure that it does not apply to home care.

 

Item 67: Clause 1 of Schedule 1

This item adds two new definitions, to mirror definitions added in to the Act.  These definitions are:

  • prioritised home care recipient which as the same meaning as in the Act; and
  • unspent home care amount of a care recipient has the meaning as given by the User Rights Principles.

 

As explained in the overview to this explanatory memorandum and discussed under item 59, once these changes take effect, funding for a home care package will ‘follow the consumer’ (care recipient).  Portability of funding is a key element in ensuring that a consumer is able to change their provider if they wish to do so.  This is consistent with the policy intent of the home care reforms that the package ‘belongs to the consumer’ and will minimise financial disincentives to a consumer changing providers.

 

It is intended that when a home care recipient moves between approved providers of home care, the unspent home care amount (subsidy and/or fees paid by care recipient less any administrative charges) will move with the care recipient to the new home care provider.  Where a care recipient permanently leaves home care, provision will also be made for unspent funds to be returned to the care recipient (or their estate) and the Commonwealth according to respective contributions made by each party.  The proposed implementation arrangements have been discussed with stakeholders, including representatives of consumers and providers, as part of a co-design approach.  

 

There is considerable complexity in defining unspent home care amounts and how these amounts will be treated under different scenarios.  Given this, the details of the approach to dealing with unspent funds will be set out in the User Rights Principles. 

 

In order to be eligible for home care subsidy, under new paragraph 46-1(f), an approved provider must agree to deal with unspent home care amounts in accordance with the User Rights Principles. 

 

The amendments to the User Rights Principles would be subject to full Parliamentary scrutiny according to the usual legislative requirements.

 

 

Part 2 - Contingent amendments

 

Division 1- Amendments if Part 1 of this Schedule commences before the Aged Care Amendment (Red Tape Reduction in Places Management) Act 2016

 

Item 68: Paragraph 16-14(4)(a)

This item varies paragraph 16-14(4)(a) if this Schedule commences before the Red Tape Reduction in Places Management Act 2016 .  If the Schedule commences after the Red Tape Reduction in Places Management Act this item will not be needed as the Red Tape Reduction in Places Management Act will make the change outlined below.

 

This item removes the stipulation in paragraph 16-14(4)(a) that an application for the transfer of provisionally allocated places can be made even if an approval as an approved provider has not yet come into force.  This amendment will be necessary as approvals will now come into force as soon as an entity is notified of its approved provider status.

 

Division 2 - Amendments contingent on the Aged Care Amendment (Red Tape Reduction in Places Management) Act 2016

 

Item 69: Paragraph 16-13(4)(a)

This item varies paragraph 16-13(4)(a) as inserted by the Red Tape Reduction in Places Management Act 201 6, so only comes into effect if this Schedule commences after the Red Tape Reduction in Places Management Act

 

Paragraph 16-13(4)(a) provides a timeframe in which an approved provider must give the Secretary a specific notice, and qualifies that an approved provider must provide the notice within 60 days, regardless of whether the approval has come into force.  This qualification will not be necessary, as approvals will now come into force as soon as an entity is notified of its approved provider status.

 

Part 3 - Application and transitional provisions

 

Item 70: Definitions

This item defines specific terms that are used in Part 3.  In particular:

  • commencement time means the time when Part 3 commences;
  • new law means the Act as in force immediately after the commencement time; and
  • old law means the Act as in force immediately before the commencement time.

 

Item 71: Amendments relating to approval of providers

This item sets out transitional arrangements relating to approval of providers. 

 

Subsection (1) provides that amendments made to section 8-1 and section 8-5 apply to any applications that have been made, but not determined, before the commencement of these provisions, as well as any applications made after the commencement of this Schedule.

 

Subsection (2) provides that the proposed amendments to section 8-3 apply in relation to:

·          any application to be approved as a provider of aged care made after the commencement time; and

·          any change of circumstances materially affecting the approved provider’s status, as referred to in paragraph 9-1(1)(a) which occur after the commencement time; and

·          any request the Secretary makes to an approved provider requesting information under subsection 9-2(1) or paragraph 9-3B(2)(a) after the commencement time; and

·          any approval revoked under paragraph 10-3(1)(b) after the commencement time.

 

As such, subsection (2) ensures that the changes to section 8-3 apply to applications and requests made under Part 2.1 apply after the commencement of the Schedule.

 

This means that the old law in relation to section 8-3 will be applied in the consideration of these matters that are on foot at the commencement of the Schedule.

 

Subsection (3) provides that if a person is approved to be an approved provider under section 8-1 of the Act, but the approval has not yet commenced (for example, because the provider does not hold an allocation of places or a provisional allocation of places), then the approval will take effect upon commencement of this provision.

 

Subsection (4) clarifies that subsection (3) will take effect despite subsection 8-1(3) of the new law.

 

Item 72: Obligation to notify Secretary about home care services etc.

This item provides that an approved provider that is operating a home care service before this provision commences is taken to have discharged its obligations to notify the Secretary under section 9-1A. 

 

Item 73: Approvals to no longer lapse

This item specifies that the repeal of section 10-2 applies in relation to approvals that are active at the time the Schedule commences.  As a result, all approvals in force at the time this Schedule commences will not lapse.

 

Item 74: Applications relating to allocations of home care places

This item provides that any applications in relation to the allocation of places for home care (including transfers or variations) under sections 13-1, 16-2, 16-7, 17-2 or 17-7 that are on foot at the commencement of this Schedule are taken never to have been made.  As the concept of allocated places for home care will be extinguished upon commencement of this Schedule, these applications will be of no effect.

 

Item 75: Planning the allocation of places

This item specifies that amendments relating to the cessation of the allocation of places for home care (i.e. the planning undertaken under Division 12) will apply in relation to the financial year beginning on 1 July 2016, and for every subsequent year.  As such, the 2015 Aged Care Approvals Round is expected to be the last round in which home care places are allocated to providers.

 

Item 76: Cessation of places for home care subsidy

This item makes clear that all home care places allocated to approved providers cease to have effect on commencement of the Schedule. 

 

Item 77: Priority for home care services

This item provides transitional provisions for the application of section 22-2A of the new law.  Section 22-2A relates to the determination of a person’s priority for home care services.

 

Subsection (1) provides that subsection 22-2A(1) applies upon commencement of this Schedule.

 

Subsection (2) allows the Secretary to determine a person’s priority for home care services if they were approved as a care recipient under Part 2.3 of the Act before the commencement of this Schedule.

 

Subsection (3) provides that any determination made by the Secretary made under subsection (2) must be consistent with the needs of the person.

 

Subsection (4) states that a determination made under subsection (2) is taken to be a determination of the person’s priority for home care services under subsection 22-2A(1) of the new law.  The effect of this subsection is that a determination under subsection (2) is a reviewable decision under section 85-1, and will be able to be varied under subsection 22-2A(2).

 

Subsection (5) provides that any determination made under subsection (2) must be made in writing.

 

Item 78: Prioritised home care recipients

This item provides transitional provisions for home care recipients who are receiving Commonwealth subsidised home care upon the commencement of this Schedule.

 

Subsection (1) provides that an approved provider will continue to receive home care subsidy for provision of care to a care recipient upon commencement of the new law if:

·          the approved provider holds an allocation of places that is in force under Part 2.2; and

·          there is in force a home care agreement under which a care recipient is to be provided with home care in respect of the place by the approved provider.

 

Subsection (2) provides that on commencement of the Schedule, the Secretary is deemed by written notice, to have made a determination under section 23B-1 that applies to all care recipients who were in receipt of subsidised home care immediately prior to the reforms, and applies in relation to the level of care being provided to the care recipient immediately before the commencement time.  This item will operate to ensure continuity of care for home care recipients and continued eligibility for subsidy for providers, provided that the other requirements of subsection 46-1(1) are met. 

 

Subsection (3) allows the Secretary to vary or cease a determination made under subsection (2) in accordance with Division 23B.

 

Item 79: Unspent home care amount

This item provides transitional provisions in relation to unspent home care amount. 

 

Subsection (1) provides that paragraph 46-1(1)(f) of the Act and paragraph 46-1(1)(f) of the Transitional Provisions Act only applies to home care subsidy and home care fees that were paid from 1 July 2015.  All home care packages have been required to be delivered on a ‘consumer directed care’ basis since that date, including the requirement for providers to supply home care recipients with monthly invoices accounting for any unspent amounts associated with their package.  Approved providers will not be required to transfer or return unspent home care subsidy and home care fees that were paid before 1 July 2015.

 

Subsection (2) provides that subsection 95-1(3), which allows the Commonwealth to recover unspent home care subsidy from approved providers, will only apply to home care subsidy paid from 1 July 2015.

 

Item 80: Responsibilities of approved providers

This item clarifies that all responsibilities approved providers have under paragraph 63-1(1)(e) remain once the Schedule commences, despite any of the proposed amendments.  This means that any records or copies of records required to be transferred under paragraph 63-1(1)(e), as a result of a transfer of places to another person prior to commencement, are still required to be transferred.

 

Item 81: Information about number of places included in homecare services before commencement

This item allows the Secretary to publish the number of places that were included in a home care service immediately before this Schedule commences.  This information may be included in future reports prepared by the Secretary, such as the Report on the Operation of the Aged Care Act 1997 .

 

Item 82: Delegations

This item provides that all delegations in force before the commencement of the new law will continue to operate once the new law comes into force.  This ensures seamless continuity of the administration of the Act, despite the changes made to the delegations power in subsection 96-2(1).

 

Item 83: Transitional rules

This item gives the Minister the ability to make rules prescribing matters of a transitional nature relating to the operation of this Act.  Subsection (1) specifies that the rules will be a legislative instrument for the purposes of section 5 of the Legislative Instruments Act 2003 , and may relate to amendments or repeals made by the new law.

 

Subsection (2) clarifies the scope of the Minister’s power to make the rules, and specifies that the rules cannot:

  • create an offence or civil penalty;
  • provide powers of arrest, detention, entry, search or seizure;
  • impose a tax;
  • set an amount to be appropriated from the Consolidated Revenue Fund under an appropriation of this Act; or
  • directly amend the text of this Act.

 

Subsection 3 clarifies that the Act, does not limit the rules that may be made for the purposes of subsection (1).

 

It is appropriate to include provision for delegated legislation to address transitional matters that may arise in the administration of these reforms.  Given the complexity of the reforms being legislated, the rules may be required to address minor administrative matters that may arise and that might not otherwise be able to be addressed swiftly.

 

The transitional rules would be subject to full Parliamentary scrutiny according to the usual legislative requirements.




[1] The term ‘consumer’ is used in a policy context, rather than ‘care recipient’ which is used in the legislation.

[2] Commonwealth of Australia, 2015 Intergenerational Report , p. 12.

[3] Department of Health, 2014-15 Report on the Operation of the Aged Care Act , p. 7.

[4] www.myagedcare.gov.au/

[5] KPMG, Evaluation of the consumer-directed care initiative - Final Report , 2012, pp. 67-68

[6] Productivity Commission Inquiry Report, Caring for Older Australians , 2011

[7] Hugo, G. The Demographic Facts of Ageing in Australia - July 2014, p 17.

[8] COTA. Conversations on Ageing sessions - August 2011 to February 2012.

[9] Australian Government Productivity Commission, Caring for Older Australians: Productivity Commission Inquiry Report Vol. 1, No. 53, 2011, p. xxviii.

[10] National Aged Care Alliance website. http://www.naca.asn.au

[11] National Aged Care Alliance, Blueprint for Aged Care Reform, February 2012, p. 4.

[12] National Aged Care Alliance, Enhancing the quality of life of older people through better support and care, NACA Blueprint Series, June 2015.

[13] https://www.dss.gov.au/our-responsibilities/ageing-and-aged-care/aged-care-reform/aged-care-sector-committee/red-tape-reduction-action-plan

[14] Aged Care (Living Longer Living Better) Act 2013 (Cth) s 4(4).

[15] Based on an internal review of the 2014 ACAR application process for home care.

[16] In the 2015 ACAR, providers applied for 126,826 home care places in respect of the 6,045 places available.  In the 2014 ACAR, providers applied for 108,281 home care places in respect of the 6,653 places available.  In the 2012-13 ACAR, providers applied for 106,503 home care places in respect of the 5,835 places available.

[17] Aged Care Financing Authority, Call for submissions, Issues affecting the financial performance of rural and remote providers, across residential, home and flexible care, August 2015.

[18] http://livestream.ssc.gov.au/dss/19october2015/