The legislative framework for Increasing Choice in Home Care is now in place following the registration of the amendments to the Aged Care Principles and Determinations on 23 September 2016.
This document will be updated in the coming weeks with information regarding the final legislative arrangements.
Questions and Answers
Increasing Choice in Home Care – Stage 1
20 May 2016
OVERVIEW OF THE INCREASING CHOICE REFORMS
Q1. What are the home care reforms?
Q2. What is the Home Care Packages Programme?
Q3. What is Consumer Directed Care?
OVERVIEW OF FEBRUARY 2017 CHANGES
Q4. When do the changes commence?
Q5. What is the financial impact?
Q6. Will the number of home care packages continue to be capped?
Q7. Will there be amendments to the Aged Care legislative framework?
Q8. What is the Aged Care Legislation Amendment (Increasing Consumer Choice) Act 2016?
Q9. How will the reforms benefit consumers?
Q10. Will there be any changes to income testing or fee arrangements?
Q11. Will funding (home care subsidy) be paid directly to the consumer?
Q12. How will the reforms affect providers?
Q13. How will the changes reduce red tape for providers?
Q14. Is there a Regulation Impact Statement for these changes?
Q15. Will there be any impact on the Department of Veterans Affair’s aged care programmes?
Key themes of Stage 1
Assessment and Eligibility
Q16. What do the reforms mean for assessment and eligibility for home care?
Q17. What do the changes mean for people with an ACAT approval for home care who have not started receiving care at commencement?
Prioritisation and assignment of packages
Q18. Why is a national system being introduced to access subsidised home care?
Q19. How will the national prioritisation system work?
Q20. Will there be a limit on how long a consumer can take to start receiving services once they have been assigned a package?
Q21. What support will be available to consumers to access information and choose a provider?
Q22. How will the changes affect people from special needs groups?
Q23. What do the changes mean for consumers who are receiving subsidised care in a home care place at commencement?
Q24. What is being done to ensure My Aged Care has consolidated the July 2015 changes and will be ready to deliver the Stage 1 changes from February 2017?
Portability of home care packages and unspent funds
Q25. What are ‘unspent funds’ in a home care package?
Q26. How will ‘unspent funds’ be dealt with in the future?
Q27. How can a provider charge an exit fee if an exit fee is not currently included in a consumer’s home care agreement?
Q28. Why does the legislation talk about unspent funds going back to 1 July 2015? How will this provision apply?
Changes for Approved Providers
Q29. What are the changes to the approved provider application process?
Q30. What will happen to packages which are currently allocated to an approved provider?
Q31. What new quality arrangements will there be for home care?
Consultation, communication and transition activities
Q32. What consultation has there been?
Q33. What further consultation and communication activities are planned?
FURTHER REFORM
Q34. The Government announced its intention to undertake a second stage of reforms. What will Stage 2 of the home care reforms look like?
OVERVIEW OF THE INCREASING CHOICE REFORMS
Q1. What are the home care reforms?
Significant reforms to home care were announced in the 2015-16 Budget. The reforms will improve the way that home care services are delivered to older Australians.
Commencing on 27 February 2017, funding for a home care package will follow the consumer. This will enable a consumer to choose a provider that is suited to them and to direct the funding to that provider. The consumer will also be able to change their provider if they wish, including if they move to another area to live.
Q2. What is the Home Care Packages Programme?
The objectives of the Programme are:
•to assist people to remain living at home; and
•to enable consumers to have choice and flexibility in the way that the consumer’s aged care and support is provided at home.
Home care packages are available at four levels, with the majority of the packages funded at level 2 and level 4. There are around 73,000 operational home care packages across Australia.
Package level / Number and proportion of operational packages(at 30 June 2015)
Level 4 / 14,680(20.2%)
Level 3 / 3,815 (5.2%)
Level 2 / 51,956 (71.5%)
Level 1 / 2,251 (3.1%)
Total / 72,702 (100%)
(Source: 2014-15 Report on the Operation of the Aged Care Act 1997)
At present, packages (home care places) are allocated to providers through the Aged Care Approvals Round (ACAR). 6,445 new home care places were allocated through the 2015 ACAR. In response to stakeholder feedback, a large percentage of the packages allocated in the 2015 ACAR were at higher levels (i.e. level 3 and 4 packages). This will be the last ACAR in which home care packages are allocated directly to providers (i.e. before the February 2017 changes commence).
There will continue to be four levels of home care packages from February 2017.
In addition to having an allocated place, to receive home care subsidy a provider must also be approved by the Department of Health under the Aged Care Act 1997, i.e. be an ‘approved provider’. The subsidy is paid to the approved provider for a home care place occupied by a care recipient (consumer). Providers are required to comply with a range of responsibilities under the Act relating to factors such as quality of care, user rights and accountability requirements.
Currently, to access a home care package, a consumer has to be assessed and approved as eligible for home care by an Aged Care Assessment Team (ACAT) and offered a package by an approved provider. A package may include a range of co-ordinated personal care, support services, clinical care and other services tailored to meet the assessed needs of the consumer, including people with dementia and other special needs.
Q3. What is Consumer Directed Care?
Consumer Directed Care (CDC) gives consumers greater flexibility in determining what level of involvement they would like to have in managing their own home care package. Consumers and providers work in partnership to identify the consumer’s goals and needs, which form the basis of a care plan.
CDC also provides consumers with clear information about what funding is available for their care and services and how those funds are spent through an individualised budget and monthly income and expenditure statements. These tools ensure that providers and consumers have a shared understanding of available resources and how those resources are being expended to meet the consumer’s needs.
While the total amount of care and services will be limited by the level of the package and the funding available, approved providers are encouraged to sub-contract or broker services from other service providers in order to deliver the range of care and services agreed between the approved provider and the consumer.
All home care packages are now required to be delivered on a CDC basis.
Through the introduction of CDC, many consumers now have more choice as to how their care is delivered, with increased transparency over what budget is available and how funds are spent. However, under the current arrangements, it is difficult for consumers to change to another provider or move to another location. There is also variable use of sub-contracting arrangements by providers.
OVERVIEW OF FEBRUARY 2017 CHANGES
Q4. When do the changes commence?
27 February 2017.
It is proposed that some approved provider obligations relating to the inclusion of exit fees in home care agreements prior to 27 February 2017 will commence earlier (see Question 28).
Q5. What is the financial impact?
Over four years, from 2015-16, $73.7 million has been committed to implement the home care reforms. This includes funding for significant systems changes and new functions for My Aged Care.
Q6. Will the number of home care packages continue to be capped?
Yes. The total number of packages will continue to be capped nationally to ensure that expenditure is controlled in line with the forward estimates. Packages will be released throughout the year within the total number of packages and funding available for distribution.
In determining the number of packages to release, the Department will continue to work within the policy parameters of the aged care planning ratio and the forward estimates. The current planning target is 45 home care places per 1,000 people aged 70 years and over by 2021-22.
Q7. Will there be amendments to the Aged Care legislative framework?
Implementation of the reforms requires amendments to both primary and delegated aged care legislation. Amendments to the Aged Care Act are now in place and will come into effect on 27 February 2017, with the commencement of theAged Care Legislation Amendment (Increasing Consumer Choice) Act 2016(see Question 8).
Amendments are also required to delegated legislation (Aged Care Principles and Determinations) made under the Aged Care Act. On 11 May 2016, the Department released a consultation paper and an exposure draft of the proposed amendments to the delegated legislation. The consultation paper provides further detail and explanation of the proposed amendments to the delegated legislation and seeks feedback from aged care providers, consumers, carers and other interested parties.
The consultation documents are available on the Consultation Hub. Written submissions to the consultation paper will close at 5pm, 9 June 2016.
As the Government has entered a caretaker period, policy decisions that bind a future Government will not be made during this period. However, the Department is proceeding to consult during this period so that we will be ready to brief the incoming Government on stakeholders’ views regarding the proposed changes to the Principles and Determinations.
Q8. What is the Aged Care Legislation Amendment (Increasing Consumer Choice) Act 2016?
The Aged Care Legislation Amendment (Increasing Consumer Choice) Act 2016 (the Amendment Act) gives effect to reforms to the home care program(see Question 1). The Amendment Act will commence on 27 February 2017.
The Amendment Act was introduced into Parliament on 11 February 2016 and was passed by the House of Representatives on 2 March and the Senate on 3 March. It received Royal Assent on 18 March 2016.
On commencement, the Amendment Act will amend the Aged Care Act 1997 and the Aged Care (Transitional Provisions) Act 1997 in three main areas.
•Funding for a home care package will follow the consumer, replacing the current system where home care places are allocated to individual approved providers to deliver service in a particular location or region. This will provide more choice for the consumer in selecting their provider and flexibility to change their provider if they wish, including if they move to another area to live. Providers will no longer have to apply for new home care places through the Aged Care Approvals Round, significantly reducing red tape and regulation for businesses.
•There will be a consistent national approach to prioritising access to home care packages through My Aged Care (the entry point to the aged care system).
•There will be a streamlined process for organisations seeking to become approved providers under the Aged Care Act 1997. This will encourage new providers to enter the home care market, supporting greater choice for consumers, but all providers will still need to demonstrate their suitability to become an approved provider and meet quality standards.
The Amendment Act and an Explanatory Memorandum outlining these amendments can be viewed on the Federal Register of Legislation website at:
Q9. How will the reforms benefit consumers?
These changes will provide consumers with more choice and control over their home care package.
Funding for a home care package will follow the consumer, replacing the current system where home care places are allocated to individual approved providers. This will provide more choice for the consumer to select a provider that is suited to them. For example, a consumer may seek a home care service that specialises in providing care to people from culturally and linguistically diverse backgrounds.
Once the changes take effect, all consumers (new and existing) will benefit from these changes. A home care package will be portable for the consumer, if they wish to move location or change to another provider. The package, including any unspent funds, will move with the consumer to their new provider.
Q10. Will there be any changes to income testing or fee arrangements?
No. There are no changes to the current incoming testing or fee arrangements in February 2017.
Q11. Will funding (home care subsidy) be paid directly to the consumer?
No. From February 2017, funding (home care subsidy and supplements) will continue to be paid to a single approved provider, but consumers will be able to direct Government funding to the provider of their choice.
Where an approved provider is unable to provide all of the care and services included in the consumer’s care plan, the approved provider will still be able to subcontract or broker services from another service provider.
Q12. How will the reforms affect providers?
These changes will enable the sector to transition to a more competitive market-driven environment. This will provide opportunities for consumer focused and innovative providers to expand their businesses to meet local demand and consumer expectations, including the needs of consumers with dementia and other special needs. Providers will no longer be limited by the number of home care places they have been allocated by the Government.
Providers will no longer need to apply for new home care places through the Aged Care Approvals Round (ACAR). The removal of the ACAR for home care places has been widely supported by the sector, as the ACAR application process is resource intensive for providers and has been criticised for the regulatory burden it places on business and community organisations.
While welcoming the reduction in red tape, some existing providers have expressed concerns about the impact of increased competition and the loss of certainty of business income once home care places are no longer allocated to providers. The financial impact of the changes on providers will be closely monitored by the Aged Care Financing Authority. The monitoring will particularly examine the impact on service delivery in regional and rural areas.
The total number of home care packages is continuing to increase each year, so there is an opportunity for all providers to continue to operate in the market. The challenge is for all providers to understand their consumer’s needs and deliver services which meet those needs.
Changes are also proposed to streamline and simplify the process for becoming an approved provider of subsidised home care (see Question 31).
Q13. How will the changes reduce red tape for providers?
Overall, the February 2017 changes present a net reduction in red tape for providers. The reduction in red tape is comprised of the following elements:
•providers no longer being required to apply for home care places through the Aged Care Approvals Round;
•removal of the existing arrangements that govern the management of allocated home care places, e.g. transfer of places, variation to conditions of allocation; and
•streamlining of the approved provider application process.
These savings offset the estimated regulatory impact of new responsibilities for home care providers regarding the treatment of unspent funds. These responsibilities include reconciling the amount of unspent funds and transferring amounts when a consumer changes home care provider or leaves home care.
Q14. Is there a Regulation Impact Statement for these changes?
Yes. There is a Regulation Impact Statement (RIS) for the February 2017 changes to home care. The RIS is part of the Explanatory Memorandum. A copy of the RIS is published on the Office of Best Practice Regulation (OBPR) website.
Q15. Will there be any impact on the Department of Veterans Affair’s aged care programmes?
There will be no impact on the Department of Veterans Affairs (DVA) programmes in February 2017. DVA clients can continue to access mainstream programmes and DVA programmes, so long as services are not duplicated.
Key themes of Stage 1
Assessment and Eligibility
Q16. What do the reforms mean for assessment and eligibilityfor home care?
Aged Care Assessment Teams (ACAT)undertake comprehensive, holistic, multi-disciplinary assessments to determine a person’s eligibility to access Commonwealth-subsidised aged care.From February 2017, the role of assessing eligibility for home care will continue to be undertaken by ACATs.
Currently, the assessment approval relates to a broadbanded level (i.e. level 1/2 or level3/4).From 27 February 2017, the assessment approval will indicate a specific package level (i.e. level 1, 2, 3 or 4).
All consumers who have been assessed by an ACAT and approved as eligible for a package will be placed on the national prioritisation systemin order to access subsidised home care(see Question 20).