Sydney, New analysis has revealed that many Australian aged care residents are not receiving the levels of care they need and are entitled to.
The UTS Aging Research Collaborative, in which we are involved, recently released its 2023-24 mid-year report on Australia's aged care sector.
A particular focus of this edition was the level of direct care that nurses and personal care workers provide to residents in nursing homes. In sharing this analysis, we recognize that there is a well-documented shortage of workers across the economy, with the unemployment rate at an all-time low. And even given these work pressures, many senior care providers are providing very high levels of care. But a significant number are not. Nearly two-thirds of nursing homes do not meet mandated levels of direct care. And yet, taxpayers have paid millions of dollars to providers to provide that care. As a result, some suppliers are making large surpluses.
New standards for direct care
In response to the findings of the Royal Commission into the Quality and Safety of Aged Care, the federal government committed to setting minimum standards for the level of direct care time residents should receive. In 2022, all providers were given one year to increase their staffing levels to meet these standards and received funding to do so. These standards require an industry-wide average of 200 minutes of direct care per person per day (per of registered and licensed nurses and personal care workers). And 40 minutes of this care must be provided by a registered nurse. The minimum level that each resident should receive varies above or below those 200 minutes depending on her assessed needs.
These standards became mandatory on October 1, 2023. During the first three months after the goals were required, only half of all providers met or exceeded any of their care goals (the total minutes of direct care or the goal of registered nursing). Only 36% fulfilled both.
This was a small increase from the previous quarter, but some providers still fell short of funding the costs of care.
Residential aged care is funded for three main activities:
Direct care, such as nursing and personal care, including bathing, dressing, toileting, and grooming (funded almost entirely by taxpayers). Daily living services, such as food, laundry, and housekeeping (paid primarily by residents and with a limit of 85% of the single age pension).
accommodation (paid for by the government for those with limited means and self-funded for those with greater income and wealth).
Following advice from the Independent Healthcare and Aged Care Pricing Authority, the government has increased direct care funding for every resident living in a care home. The home is assumed to spend that money on hiring enough staff to meet its level of care goals. The report shows the difference between each nursing home's average funding for direct care and its spending on that activity. Comparing the mid-year results of the last three years, in 2021 and 2022 households produced, on average, a small surplus where income was slightly higher than salaries and other expenses. This situation, where financing is just above costs, is the intended result of the new pricing reforms.
But things have changed in the most recent period. The government has significantly increased funding to cover staffing costs to achieve mandated levels of care. Funding has also increased in light of pay increases for direct care staff, mainly nurses and personal care workers, which was decided by the Fair Work Commission.
This taxpayer funding has been provided to each home regardless of whether they employ the required number of staff. Due to the failure of some providers to meet their mandatory targets through December 2023, the sector, on average, generated a significant direct care surplus from more than 13 Australian dollars per resident per day. Some providers have been using the money to subsidize the losses they incur for their daily living and accommodation services.
Which homes are not meeting their objectives?
We found that households that did not provide their mandated care minutes derived, on average, significant financial benefits from their direct care activities. Homes that had staff care levels well above the required number were suffering losses from their direct care. Additionally, homes that were not delivering their mandated care minutes were more often found in larger metropolitan and regional centers. They were also more likely to be operated by for-profit providers.
In essence, while we recognize the tightness of the labor market and the effort many homes are making to meet or exceed their mandatory requirements, a large number of residents are not receiving the care they need. This also means that taxpayers are funding direct care that is not provided.
With the industry's minimum average level of direct care increasing to 215 minutes per resident per day on October 1 of this year (and registered nursing care increasing to 44 minutes), this situation may get even worse. (The conversation) AMS
The UTS Aging Research Collaborative, in which we are involved, recently released its 2023-24 mid-year report on Australia's aged care sector.
A particular focus of this edition was the level of direct care that nurses and personal care workers provide to residents in nursing homes. In sharing this analysis, we recognize that there is a well-documented shortage of workers across the economy, with the unemployment rate at an all-time low. And even given these work pressures, many senior care providers are providing very high levels of care. But a significant number are not. Nearly two-thirds of nursing homes do not meet mandated levels of direct care. And yet, taxpayers have paid millions of dollars to providers to provide that care. As a result, some suppliers are making large surpluses.
New standards for direct care
In response to the findings of the Royal Commission into the Quality and Safety of Aged Care, the federal government committed to setting minimum standards for the level of direct care time residents should receive. In 2022, all providers were given one year to increase their staffing levels to meet these standards and received funding to do so. These standards require an industry-wide average of 200 minutes of direct care per person per day (per of registered and licensed nurses and personal care workers). And 40 minutes of this care must be provided by a registered nurse. The minimum level that each resident should receive varies above or below those 200 minutes depending on her assessed needs.
These standards became mandatory on October 1, 2023. During the first three months after the goals were required, only half of all providers met or exceeded any of their care goals (the total minutes of direct care or the goal of registered nursing). Only 36% fulfilled both.
This was a small increase from the previous quarter, but some providers still fell short of funding the costs of care.
Residential aged care is funded for three main activities:
Direct care, such as nursing and personal care, including bathing, dressing, toileting, and grooming (funded almost entirely by taxpayers). Daily living services, such as food, laundry, and housekeeping (paid primarily by residents and with a limit of 85% of the single age pension).
accommodation (paid for by the government for those with limited means and self-funded for those with greater income and wealth).
Following advice from the Independent Healthcare and Aged Care Pricing Authority, the government has increased direct care funding for every resident living in a care home. The home is assumed to spend that money on hiring enough staff to meet its level of care goals. The report shows the difference between each nursing home's average funding for direct care and its spending on that activity. Comparing the mid-year results of the last three years, in 2021 and 2022 households produced, on average, a small surplus where income was slightly higher than salaries and other expenses. This situation, where financing is just above costs, is the intended result of the new pricing reforms.
But things have changed in the most recent period. The government has significantly increased funding to cover staffing costs to achieve mandated levels of care. Funding has also increased in light of pay increases for direct care staff, mainly nurses and personal care workers, which was decided by the Fair Work Commission.
This taxpayer funding has been provided to each home regardless of whether they employ the required number of staff. Due to the failure of some providers to meet their mandatory targets through December 2023, the sector, on average, generated a significant direct care surplus from more than 13 Australian dollars per resident per day. Some providers have been using the money to subsidize the losses they incur for their daily living and accommodation services.
Which homes are not meeting their objectives?
We found that households that did not provide their mandated care minutes derived, on average, significant financial benefits from their direct care activities. Homes that had staff care levels well above the required number were suffering losses from their direct care. Additionally, homes that were not delivering their mandated care minutes were more often found in larger metropolitan and regional centers. They were also more likely to be operated by for-profit providers.
In essence, while we recognize the tightness of the labor market and the effort many homes are making to meet or exceed their mandatory requirements, a large number of residents are not receiving the care they need. This also means that taxpayers are funding direct care that is not provided.
With the industry's minimum average level of direct care increasing to 215 minutes per resident per day on October 1 of this year (and registered nursing care increasing to 44 minutes), this situation may get even worse. (The conversation) AMS
