Australian Government
Aged Care Financing Authority
2013-14 Operations Report of the Aged Care Financing Authority
2013-14 Operations Report of the Aged Care Financing Authority 1
Introduction
This is the second annual report to the Assistant Minister for Social Services, SenatortheHonMitchFifield on the operations of the Aged Care Financing Authority (the Authority). The report covers the period 1July2013 to 30June2014.
The annual operations report has been prepared pursuant to the Committee Principles 2014 issued under the Aged Care Act 1997. Section 8 of the Committee Principles 2014 requires that:
(1) The Authority must, as soon as practicable after the end of each financial year, prepare and give to the Minister a report on the operations of the Authority during that year.
(2) As soon as practicable after giving the report to the Minister, the Authority must publish a copy of the report on the Authority’s website.
ESTABLISHMENT OF THE AUTHORITY
Background
The Authority was established on 1August2012. Its role is to provide independent, transparent and evidence based advice to the Government on funding, pricing and financing issues in the aged care sector, informed by consultation with consumers, and the aged care and finance sectors. Secretariat support is provided by the Ageing and Aged Care Stream of the Department of Social Services.
Authority Membership
The members of the Authority during the reporting period were:
Ms Lynda O’Grady / Chairman /Professor Graeme Hugo / Deputy Chair
Mr Ian Yates / Member
Mr Nicolas Mersiades / Member
Ms Sally Evans / Member
Mr Graham Hodges / Member
Mr Gary Barnier / Member
Ms Leanne Thomas / Member
Ms Mary Patetsos / Member
There are three non-voting Government representatives on the Authority.
Ms Carolyn Smith / A/g Deputy Secretary of the Ageing and Aged Care Stream,Department of Social Services /
Ms Kim Cull / Aged Care Pricing Commissioner
Mr Robert Montefiore-Gardner / A Senior Adviser from the
Department of Treasury
The Authority met 11 times during the reporting period.
Authority Operations
The Operating Framework outlines the Authority’s responsibilities in performing its functions. This includes the Authority’s ability to request research when formulating advice to the Minister, and the requirement that the Authority’s research and advice is published.
Key activities during the year
The Authority progressed work on a range of activities during the reporting period.
Task / Progress/Key Dates /Improving the Collection of Financial Data from Aged Care Providers / The Authority provided interim advice to Government on 31July2013
Significant work took place in developing the final report submitted to Government on 30September 2014
The Supported Resident Data Book. An interim deliverable in relation to the review of the mechanisms to ensure supported residents access to aged care / Supported Resident Data Book provided to Government on 29April 2014
The final report is due to Government on 31December2015
Annual Report on the Funding and Financing of the Aged Care Industry / Significant work on the Report was undertaken and the Report submitted to Government on 1 August 2014
Development of Reform Monitoring and Methodology Project / Monitoring commenced on 1 July 2014
Significant work in developing survey methodology and monitoring was undertaken during the year
Communication and Engagement with the Aged Care Sector
The following communication and engagement activities were undertaken by the Authority during the reporting period.
During the year, the Authority held meetings and forums with representatives from the investment and financing industries, providers and consumers. These meetings and forums have been critical to the Authority’s understanding of the key issues, developments and challenges facing the industry. The Authority will continue with its engagement strategy over the next 12 months, with a particular focus on the impact of the 1 July 2014 reforms on all stakeholders.
Investors
In December 2013, the Authority held Investment and Financing Roundtables in Sydney and Melbourne to obtain feedback from debt and equity financiers on their views of the aged care industry. Between the two Roundtables, over 40 interested parties participated.
These Roundtables were very successful and are likely to be held again in the future.
Providers
During the first half of 2014, the Authority met with Chief Executive Officers and board members of the Leading Aged Services Australia (LASA), the Aged and Community Services Australia (ACSA), Catholic Health Australia (CHA), the Aged Care Guild and Uniting Care to discuss the industry’s financing.
The provider peaks assisted the Authority in developing mechanisms for providers to supply the Authority with information on post 1 July 2014 Refundable Accommodation Deposit (RAD) movements to inform the Authority’s implementation monitoring reports.
The Authority and provider peaks will continue to meet on a regular basis.
Consumers
The Authority also met with the National Aged Care Alliance’s Consumer Organisations Forum. This meeting was productive for all involved and like the meetings with the provider peaks, future meetings will take place on a regular basis.
Aged Care Workforce
The Authority intends to formally engage with aged care workforce stakeholders during the year ahead to seek their feedback on the industry.
Other Stakeholders
The Authority also met with the Financial Planning Association of Australia (FPA). This meeting was similarly productive as the FPA’s members will be a vital source of information and advice to prospective aged care residents.
The Authority also met with the full membership of the National Aged Care Alliance.
Contractors and Consultants
The following firms were engaged to provide services for the Authority.
Contractor / Description /RSM Bird Cameron / Consultancy services on Improving the Collection of Appropriate Financial Data
Forms Administration Pty Ltd / Impacts of Aged Care Reforms on the Sector
RSM Bird Cameron and PricewaterhouseCoopers / Detailed Study into Factors that are Influencing the Financial Performance of Residential Aged Care Providers
Future Work Programme
The Authority’s forward work programme is as follows.
Task / Key Date /Annual Report on the funding and financing of the aged care sector / Submitted 1 August 2014
Advice on the impacts of aged care reforms on the sector, including the impact of accommodation payment arrangements, choice of payments, means testing, transitional business advisory services, and in particular the impact on rural, regional and remote providers / From 1 July 2014:
· Monthly reports until 31December2014;
· Quarterly reports from then until 31December2015;
· Ongoing advice in its annual report
Options for improving the collection of appropriate financial data from aged care providers, including options to rationalise financial reporting arrangements / Submitted 30 September 2014
Advice on the key factors influencing financial performance of providers and what could be done to improve performance, including consideration of issues affecting rural, regional and remote providers / 31 March 2015 (initial report)
Annual Report on the funding and financing of the aged care sector / 30 June 2015
Advice on cost neutral mechanisms to ensure access to care for supported residents, including reviewing the supported resident ratio / 31 December 2015 (with data book on current access trends to be delivered by 30April 2015)
Advice to inform the five year review of the aged care reforms, with particular regards to funding, financing and pricing issues affecting the matters specified for review in section 4 of the Aged Care (Living Longer Living Better) Act 2013. In particular, this advice would focus on such issues as they relate to means testing, fees, accommodation prices, access and workforce. In relation to advice on workforce issues, ACFA’s advice should focus on identification of issues affecting the long term demand, supply and quality of the aged care workforce, with an emphasis on the impact of financial and funding considerations on demand, supply and quality and advice on options to support a stable and skilled workforce to meet the growing demand for aged care services / 30 June 2016