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Reform for the future at the heart of aged care funding review

Conversations and concerns around the financial future and sustainability of the growing aged care sector have once again been raised following the release of a new report into aged care funding.

he Review of Aged Care Funding Instrument (ACFI) report has been released (Source: Shutterstock)
he Review of Aged Care Funding Instrument (ACFI) report has been released (Source: Shutterstock)

The Review of Aged Care Funding Instrument (ACFI) report, released by Minister for Aged Care Ken Wyatt, and prepared by Applied Aged Care Solutions, highlights a range of options to modify Australia’s residential aged care funding instrument.

Undertaking a ‘comprehensive review’ of ACFI, the report focuses on ways to improve the current tool, including adapting it for external assessments of funding needs and updating it to bring it into line with current practices.

The ACFI review follows on from a Government-commissioned study by the University of Wollongong, which was released in April this year, and outlines a variety of potential new funding models and tools for the aged care sector.

Minister Wyatt says no decision has been made following the study.

“We welcome the new report on residential aged care funding reform,” Minister Wyatt says.

“We are determined to put residential care funding on a more consistent, sustainable and equitable footing.”

Key recommendations among those put forward in the ACFI report include:

  • Adapting the ACFI tool to be suitable for an external model
  • Reducing subjectivity in relevant needs assessment questions; and
  • Bringing the ACFI tool in line with contemporary care practices

The next step in the long-term reform process is a Resource Utilisation and Classification Study, which is now underway at the University of Wollongong’s Australian Health Services Research Institute.

While aged care peak bodies Aged and Community Services Australia (ACSA) and Leading Aged Services Australia (LASA) welcome the report, their respective Chief Executive Officers (CEO’s) have also taken the opportunity to push the need for a broader conversation around funding to ensure the long-term sustainability of the sector.

“While this report adds to the dialogue around the allocation of subsidies for residential aged care in the short term, it does not deal with the broader issues regarding system resourcing identified by David Tune in his recent review of the Living Longer Living Better Reforms,” LASA CEO Sean Rooney says.

Mr Rooney further reflected on Mr Tune’s recent findings that show projected demand for aged care will need additional investment by government beyond what is currently planned.

The Commonwealth currently contributes $18.6 billion per year to aged care with Minister Wyatt stating that this figure is expected to reach more than $22 billion with the sectors anticipated growth.

He adds that the Government is ‘committed to a system centred on safe, quality care for our older Australians, while ensuring expenditure is affordable for consumers and sustainable for taxpayers.’

ACSA CEO Pat Sparrow says the ACFI report, in conjunction with the study currently underway at Wollongong University, will contribute to an informed assessment of the funding needs of providers as they ‘strive to deliver the best services they can for older Australians’.

“Government, and the community as a whole, needs to be asking tough questions about how we get the aged care sector on a more sustainable footing to ensure providers are equipped to deliver the care older Australians expect into the future,” she says.

“With a rapidly ageing population, that conversation is vital and urgent.”

She adds that providers want funding that is underpinned by a strong set of principles that reflect the importance of equitable access to high quality care for all older Australians requiring residential aged care.

“Ultimately, the contents of this report should help inform funding decisions that build an inclusive, sustainable model of aged care service delivery and funding that can adapt to the changing needs of Australia’s rapidly ageing population,” Ms Sparrow says.

“Reports like the review of the Aged Care Funding Instrument represent a valuable opportunity for government, the community and the industry to pause, reflect and get this vital issue of funding right.”

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