Margaret May (McPherson, Liberal Party, Shadow Minister for Ageing) Share this | Hansard source

I rise today to speak on the Aged Care Amendment (2008 Measures No. 2) Bill 2008. At the outset, let me say that the opposition has a number of reservations about certain aspects of the bill. I shall elaborate on those reservations further in my speech. That being said, the bill is largely uncontroversial. It seeks to ensure that provisions of the Aged Care Act accord with changes in the aged-care industry and addresses gaps in the aged-care framework. Caring for older Australians is a huge challenge. It requires careful planning, appropriate funding and dedicated staff. It requires acknowledgement that the ageing of our population is undoubtedly the biggest social issue that Australia and indeed the developed world faces. The challenges are enormous, but even more challenging, I would argue, is the planning that must begin now in response to our rapidly ageing population.

In September, the Productivity Commission released a research paper titled Trends in aged care services: some implications. It paints an alarming picture of the future of aged care in Australia. According to the paper, there will be a significant increase in demand for aged-care services over the next 40 years. The number of people aged over 85 is expected to increase fourfold by 2047. Today, approximately one in seven Australians is aged 65 years or older. That is 2.8 million people, or 13.4 per cent of our population. By 2050, the percentage of people over the age of 65 is expected to rise to one in four. The impact this will have on the aged-care sector over the coming years should not be underestimated.

We live in a society that demands, and rightly so, that we take care of our older citizens and give them every opportunity and support to live with dignity and with respect. In order to achieve that, we as legislators must provide policies and legislation that give all Australians confidence that our aged-care sector is delivering the optimum level of care for all senior Australians who require it. That optimum level of care will need to become more diverse and deliver a more flexible service that will respond to the changing health needs of the aged.

The former coalition government placed significant emphasis on wide-ranging reforms to deliver a high-quality, affordable and accessible aged-care system that met the needs and preferences of older Australians under the act. In her second reading speech, the Minister for Ageing correctly asserted that the aged-care industry has matured significantly since the Aged Care Act 1997 was first introduced under the former coalition government. With that maturity over the past decade, the sector has evolved from one where the owner of an aged-care facility also provided the day-to-day operation of the facility to one where increasing levels of investment in the sector are coming from larger corporate entities.

There is no doubt that a consistent and modern regulatory framework must support this evolution in the industry. One does not need to be a particularly gifted prophet to predict that the aged-care sector in a decade from now will look vastly different to the aged-care sector delivering services today—and, of course, today’s aged-cared sector looks vastly different to a decade ago when the Aged Care Act was first introduced by the former coalition government.

This bill before the House today will bring about greater consistency between the regulatory framework and contemporary business practices, recognising the change in business models over the last 10 years. The opposition supports the measures in the bill for clarifying and identifying key personnel and the role they perform within an organisation. This measure is about transparency and accountability of those delivering aged-care services to older Australians.

Another measure that the opposition supports is the further protection of accommodation bonds. In recent years, there has been significant growth in the value of accommodation bonds held by aged-care providers. In fact, more than $6 billion is currently held by approved providers in accommodation bonds. I am sure members on this side of the chamber need no reminding that it was the Howard government who introduced the Accommodation Bond Guarantee Scheme in 2006, which guaranteed the repayment of bonds if a provider were to enter into insolvency or become bankrupt.

The introduction of the guarantee scheme was a good thing, both for providers and for residents. Without a doubt it brought about greater confidence in the industry. The measures in this bill will further strengthen the protection of accommodation bonds by extending the scheme to include lump sum payments which are paid by residents to enter a facility that, at the time the payment is made, is not an approved provider but subsequently becomes an approved provider. Under the measures introduced in this bill, should that provider enter into liquidation, residents’ lump sum payments will be guaranteed through the scheme. This is an excellent measure and brings about more confidence for those paying those bonds.

Another excellent measure in this bill is the aim to reduce the number of unnecessary assessments by aged-care assessment teams. There are some assessments, it is fair to say, that are either unnecessary or that are being reviewed too frequently. This includes the need for an annual assessment for residential respite care and approvals for high-level residential care. Given ongoing approvals are generally granted at the time of reassessment, it is unlikely that the person being assessed will no longer require these services. This measure is in fact aimed at streamlining assessments, reducing red tape and, hopefully, reducing waiting times for assessment of older Australians. This can only be a good thing, particularly as I know that in many areas waiting times for ACAT assessments can be weeks and sometimes even months. The minister has indicated in her second reading speech that following these amendments to the ACAT assessment process negotiations will commence with the states and territories to ensure that the greater efficiencies provided for in the bill will result in shorter timeframes for ACAT assessments. I hope the minister will report back to the House on these negotiations, as I can advise the chamber today that lengthy waiting times for ACAT assessments are causing unnecessary stress on our elderly residents.

As I indicated at the beginning of my speech, I do have a number of reservations with regard to this bill, which I would like to outline to the chamber. These reservations and concerns have in fact been raised with me by the aged-care industry. I think that it is important to advise the minister of the issues and encourage her to work with the aged-care industry to seek some positive outcomes to these concerns. There is no doubt that the aged-care industry is at crisis point, and providers around Australia are experiencing low and deteriorating financial returns.

Given the funding constraints that providers are experiencing, it is extremely disappointing that section 22 is not being amended to address inequities in the system where a resident is assessed as being low care when in fact the resident is high care. Stakeholders involved in the consultation process of this bill were led to believe that these inequities would be addressed. Under the new aged-care funding instrument, aged-care providers are frequently finding that an aged-care assessment team’s assessment of a resident’s care needs do not reflect their true care needs—that is, many residents are being assessed as low care when in fact they require high care. The difficulty lies in the delay that a reassessment of a resident’s care needs takes. This reassessment by an aged-care assessment team—an ACAT team—can take a number of months. Hopefully that will be streamlined, but there are cases known to us where it can take weeks and even months for that reassessment to occur. During that time, however, the facility is only being paid a low-care subsidy, even if the resident is found to be high care. Upon reassessment, payment of the subsidy is not retrospective. What this means, in essence, is that providers in many cases are taking care of high-care residents but are only receiving a low-care subsidy until a reassessment has been undertaken. This non-retrospectivity of the level of subsidy paid is having a big impact on the bottom line of providers and needs to be addressed immediately.

Another area which I have real concerns about is items that come under section 65 of the act. The clause introduces an unreasonable degree of subjectivity that I believe undermines the integrity of the act. Clause 65-2(c) widens the power of the department to enable it to impose sanctions on behalf of future aged-care residents. The department already has wide powers to impose sanctions where breaches have been found to have occurred. I am therefore at a loss as to why the bill seeks to insert a new clause which deals with future care recipients. Further, clause 65-2(da) of the bill introduces a new concept, which is the ability of the department to impose sanctions to act as a deterrent against future noncompliance. Again, this is of concern to me, as the amendment widens the secretary’s power to make a judgement about the use of sanctions as a deterrent to future noncompliance. Noncompliance occurs at a point in time. The power to impose sanctions as a deterrent against future noncompliance introduces ambiguity and complexity into the legislation.

The subjectivity of the above two provisions introduces an amount of uncertainty that does nothing to strengthen the act in any way. I respectfully suggest—I ask—that the minister look at these areas of concern and engage in discussion with the aged-care industry to address these issues. Each of these issues has been raised by the aged-care industry itself, and they are issues, I believe, that should be considered as part of the inquiry by the Senate committee to which the bill has been referred.

The safety and protection of elderly residents is of paramount concern to both providers and families of residents. The minister, in her second reading speech, alluded to changes to the aged-care principles under the Aged Care Act which directly address the safety of residents, and this is a measure the opposition supports. In fact, this measure strengthens the principles which were introduced under the former, coalition government. The detail of what is intended has not been provided, but I understand from the minister that these amended principles will be introduced on 30 November. Of course, the safety of residents should never, ever be compromised, and these principles will ensure that unsuitable people are not working with frail older Australians.

For the record, I read a recent report from Aged and Community Care Victoria regarding the current system of police checks. A number of concerns were raised in the article about the current arrangement and the fact that it does not provide for continuous tracking of offences and that police checks only reveal a snapshot of the criminal history and do not give an ongoing, up-to-date record. There were also concerns raised about the variations in spent conviction schemes from state to state and varied definitions in categories of crimes and offences. I would ask the minister to consider the proposal from Aged and Community Care Victoria about whether or not a national system could be administered by one federal government department or agency to replace the current system of police checks.

For the most part this bill is supported by the aged-care industry, but it would be remiss of me today not to highlight some of the concerns we in the coalition hold for the future of the industry and, indeed, concerns the industry itself has for its future. Despite the positive attempts at reform contained within this bill, I still believe there is a long way to go in reforming the aged-care sector to reflect the needs of our ageing population. The industry needs a bipartisan approach to deal with the range of challenges currently on the radar. I do not exaggerate when I say the aged-care industry is in crisis. Without the right approach to policy and legislation, without the right approach to addressing the needs of Australia’s ageing population over the coming years, the viability of the industry will be in extreme jeopardy. Many providers are operating in the red due to funding constraints. Only last month, Grant Thornton’s interim survey was released, and it showed that the return on investment of a high-care bed was 1.1 per cent and, because of the non-viability of the sector, industry is finding it difficult to attract capital.

With regard to this bill, I believe there will be additional financial burdens on approved providers in complying with their new and amended obligations. This will act as a further deterrent of investor confidence in the industry. This is a very real concern, because we need to encourage providers to take up more bed licences, but the opposite is happening. Providers are walking away from the industry. They are returning bed licences and making decisions at a board level not to apply for further licences. There is in fact an undersubscription of those bed licences, and we saw that in the last funding round in Western Australia and Tasmania.

A division having been called in the House of Representatives—

In continuing my remarks on this aged-care legislation, a further factor in the decision is the volume of red tape, paperwork and compliance requirement which is taking the focus away from the care of Australians. I therefore urge the parliament to consider the extent to which the additional and amended obligations proposed in the bill will affect the ability of industry to provide the high level of care that older Australians expect. The Australian community take the care of our most elderly and frail very seriously. We expect older Australians to have access to high-quality and affordable aged-care services, but as staff are weighed down by paperwork the focus is taken away from care. In the coming years, the aged-care industry will need to respond to the changing health needs and longevity of Australians. As a country we will need to respond to the increasing number of Australians suffering from dementia. There will be a growing prevalence of comorbidity—people living with two or more diseases at the same time. The changing patterns of disease will create the need for greater diversity in the care needs of older Australians. But diminishing returns on investment may in fact see providers exit the industry and the needs of caring for older Australians will certainly suffer. Baby boomers will want more choice in the type of facility in which they want to invest or indeed spend the remaining years of their lives.

As I said, the viability of the aged-care industry in this country is under threat. It is under threat at a time when the ageing of our population is growing at an alarming rate. The industry is facing numerous challenges to deliver first class aged care to older Australians. To meet those challenges, the industry needs confidence and assurance from this government that it is listening and will address the funding needs of the aged-care industry. At the end of the day, it is the frail, older Australians who are going to be affected.

In closing, I do commend the minister today for strengthening the Aged Care Act 1997, but I urge her to work cooperatively with industry and indeed the opposition to develop policy that will sustain a healthy, vibrant industry that will meet the needs of our ageing population. It is imperative that a review of our aged-care regulatory and funding arrangements is undertaken as a matter of urgency. The opposition is not opposed to this bill. However, we reserve our opinions on a number of matters pending receipt of further information from the Senate inquiry.

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