House debates

Wednesday, 21 October 2020


Aged Care Amendment (Aged Care Recipient Classification) Bill 2020; Second Reading

9:32 am

Photo of Dan TehanDan Tehan (Wannon, Liberal Party, Minister for Education) Share this | | Hansard source

I move:

That this bill be now read a second time.

This bill amends the Aged Care Act 1997 to enable a new procedure to classify recipients of residential aged care and some kinds of flexible care from 1 March 2021.

The bill introduces the option to independently assess the relative care needs of individuals in residential aged care by empowering the Secretary of the Department of Health to assess care recipients using a new assessment tool and assign new classification levels. The bill also includes consequential amendments to other parts of the act to enable exercise of the new powers, including that any assessors acting as delegates of the secretary must hold professional qualifications and complete role-specific training detailed in a legislative instrument under the act.

A sustainable aged care system needs a reformed funding model. There is broad support—including through the royal commission—for a modern case-mix based funding model for residential aged care to replace the outdated Aged Care Funding Instrument.

Currently clinical workers in residential aged care are required to spend their time using the Aged Care Funding Instrument to assess residents, reducing their availability to deliver care.

Reports produced by both independent researchers and the statutory Aged Care Financing Authority have found the Aged Care Funding Instrument provides strong incentives for providers to deliver outdated methods of care—whether or not care recipients may benefit—to produce higher subsidy payments.

The Aged Care Funding Instrument has been found to no longer be fit for purpose and its use has been found to lead to perverse actions by aged-care providers, causing perverse outcomes for aged-care recipients.

Since the 2016 budget, the government has committed to developing and testing a lasting alternative to the Aged Care Funding Instrument.

Between 2017 and 2019 the government funded the University of Wollongong to perform a research project, the resource utilisation and classification study. With the involvement of almost 200 residential aged-care services, the study empirically measured drivers of the costs of delivering care, and recommended a new resident classification model called the Australian National Aged Care Classification.

Under this new model, it is proposed that assessors acting as delegates of the secretary perform resident assessments using a new assessment tool, leading to the secretary assigning new, simpler classification levels that consistently group care recipients with like care needs and like care costs.

All assessors acting as delegates of the secretary must meet strict professional qualification and additional training criteria, to be detailed in subordinate legislation.

This bill builds on the successful Australian National Aged Care Classification trial—conducted in 2019 and early 2020—and will allow a new classification using the Australian National Aged Care Classification tool to be determined for the entire residential aged-care population without affecting how subsidy for providers is calculated. This is an essential step in preparing to respond to the findings of the Royal Commission into Aged Care Quality and Safety in a timely manner.

Classification data obtained from these assessments will ensure that individuals, care workers, providers and the government all have the information they need to fully understand the new funding model.

During the information-gathering period the bill allows, providers will continue to use the existing Aged Care Funding Instrument to assess their residents in parallel with the new procedure established by the bill.

This bill enables the next phase of residential aged-care funding reform. A phase of preparation that will enable the government, in the context of a response to the findings of the Royal Commission into Aged Care Quality and Safety, to quickly and seamlessly transition funding from the outdated ACFI. It sets the stage for a more contemporary, efficient, effective and stable funding approach, one that will promote investment in residential aged-care refurbishment and expansion, and that will support providers to better deliver the individualised care that each resident needs.

Debate adjourned.