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Lack of financial resources could lead to a ‘perfect storm’ in aged care

Older Australians may be unable to access the support they need in aged care due to lack of financial resources available to providers to meet the demands of quality service provision.

UnitingCare Australia believes a ‘perfect storm’ is brewing for elderly people attempting to access care services they need. [Source: Shutterstock]

UnitingCare Australia believes this is creating the ‘perfect storm’ with numerous reports revealing the unsustainable financial performance of aged care providers across in-home and residential aged care settings.

National Director of UnitingCare Australia, Claerwen Little, says the perfect storm forming is a direct result of increasing pressure on providers to deliver services in an unsustainable funding environment.

“Our ability to meet the needs of older Australians and provide support to all who require it will continue to be compromised without a commitment to adequately funding our sector,” Ms Little says.

“Our aged care system is currently under incredible strain, and the needs of our older people, and particularly those most vulnerable, will continue to go unmet without immediate investment to ensure quality service provision and access.”

Recently, the Aged Care Financing Authority (ACFA) announced that residential aged care providers are experiencing a 5.3 percent increase in expenses each year, compared to their income, which only increases by 1.7 percent annually.

A similar case with in-home care providers, with expenses for every client increasing by 7 percent each year outweighing the drop in income received, which decreased in the 2017-2018 financial year. 

In June, aged care industry analysis firm, StuartBrown, released figures that shows the current aged care funding model was putting significant financial stress on providers, with over 45 percent of residential aged care facilities operating at a loss.

The figures highlight a stark problem in regional, rural and remote areas, where over 67 percent of providers operate at a loss.

The Government also announced a minor indexation increase in June of 1.4 percent for residential aged care, to contribute to help provide viability.

The Government have not set any commitments to ensure the delivery of quality services is sustainable.

Ms Little says, “While we acknowledge and welcome the ongoing work of the Royal Commission into Aged Care Quality and Safety, the responses to-date from successive Australian Government’s to address the funding issues in Australia’s aged care system have proven inadequate to prevent the looming perfect storm.

“It’s imperative that the Government act immediately to address this clear and present issue so that older people can access the supports and services they need, when they need them, regardless of their circumstances.”


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