The Australian aged care system provides subsidised care and support, through a range of services, to people who can no longer live without assistance.
Consistent with the recommendations of the Royal Commission into Aged Care Quality and Safety (the Royal Commission), the Commonwealth Government (the Government) has commenced funding reform of residential aged care, transitioning to the Independent Health and Aged Care Pricing Authority’s (IHACPA) system of activity based funding (ABF). This will draw on concepts from the implementation of ABF in Australian public hospitals but will need to be designed specifically for the aged care system. The new funding approach will account for, and reflect, the dynamic nature of the sector.
Under ABF, providers will be funded based on the number of residents and the type of care they require. This aims to provide a transparent, fair, equitable and predictable approach to funding that is informed by the cost of care delivery.
Several government agencies, departments and stakeholders are responsible for the delivery of safe, quality and efficient care within the sector. The aged care sector is primarily segmented into three areas of care delivery:
- Home Care including the Commonwealth Home Support Programme and Home Care Packages
- Short Term Care including Short-term Restorative Care, Transition Care and Respite
- Residential Care.
Commonwealth Home Support Programme
The Commonwealth Home Support Programme (CHSP) provides basic services to help older people to live independently at home. The CHSP is intended to provide entry-level and relatively low-intensity support for older people who require minimal assistance to continue living in their home and participating in the community. CHSP providers receive Commonwealth Government funding through grant agreements to provide subsidised services to older people. People receiving care under CHSP are expected to contribute to the cost of their care if they can afford to, with the cost depending on the type of support required and the CHSP provider.
Home Care Packages
Home Care Packages (HCP) provide support to older people assessed as having more complex needs to help them stay at home, going beyond supports provided through the CHSP. Approved aged care service providers work with people receiving care to plan, organise and deliver HCP. There are four levels of HCP to provide support from basic to high care needs.
HCP funding is comprised of Government subsidy and any applicable supplements, as well as basic daily fees (BDF), income-tested care fees and amounts for additional care and services paid by the person receiving care.
Reforms to home care
The final report of the Royal Commission into Aged Care Quality and Safety (the Royal Commission) recommended a new aged care program to assist older Australians with staying in their homes for longer. The Government is currently developing reforms to home care that are expected to consolidate a number of existing programs under a single assessment and funding model.