Julie Collins (Franklin, Australian Labor Party, Shadow Minister for Ageing and Seniors) Share this | Hansard source

As we heard from the Minister for Defence Personnel and Minister for Veterans' Affairs, the purpose of the Aged Care Legislation Amendment (Improved Home Care Payment Administration No. 1) Bill 2020 is to change home-care subsidies that are paid to providers from being paid in advance to being paid in arrears. In the lead-up to introducing this legislation I understand that the Minister for Aged Care and Senior Australians sought the advice of the Aged Care Financing Authority in relation to this legislation.

According to the Aged Care Financing Authority report presented to the government, this marks the beginning of three phases of reform to home-care payment arrangements. Essentially, we're moving from paying home-care providers in advance to ending up with a system like the NDIS, where home-care providers are paid a fee for service for the older Australians that they are caring for. I understand the first phase is set to commence in June 2020 and will trigger a change to the way providers are paid.

The second stage will involve legislation that will enable the government to deal with the unspent home-care package funds, which are currently very substantial. The second phase would commence in April 2021, and providers would only be paid the subsidy for the goods and services they actually provide to the consumer rather than receiving the full monthly subsidy amount for the recipient. Any unspent package funds would then be held by the department, not by the service provider, as is currently the case. The third phase would also commence in April 2021, and subsidy payments to providers for a consumer would be reduced by a proportion of the unspent package funds held by the provider for that recipient. I understand that this proportion is yet to be determined.

Labor do not want to hold up this bill, but we do have some concerns about the bill. We do want it to go through the parliament. I want to take this opportunity to put some of our concerns on the record around these changes. I hope and trust that the government has done its due diligence in relation to the concerns that I will raise. I do not want to see any adverse impact on providers. I do not want to see any impact on services that older Australians receive in their homes. I do not want to see any increase in home-care fees and charges to older Australians because of these changes.

Indeed, as acknowledged in the Aged Care Financing Authority report and the explanatory memorandum, some of the submissions suggested the new payment arrangements would be a risk to the viability of some providers. Many submissions referenced small providers and those particularly operating in rural and remote locations, suggesting that the risk to ongoing viability of these providers would be heightened as a result of the change in payment arrangements. Submissions from smaller providers asked that they be given special consideration and receive support to ameliorate the costs to them of the change in payment arrangements. The change from advance to arrears payments is set to commence from June 2020. Some of the service providers said this was an extremely tight turnaround for them. There is an increase in financial risk for some of the smaller service providers, who might not have adequate cash flow to deal with the payment changes. As is suggested in the Aged Care Financing Authority report, some service providers might have to revert to finding other financing arrangements, including loans or equity injections. Those home-care providers currently losing money will face significant difficulties changing over to an arrears payment arrangement. Some service providers have said that, as a result of cash flow pressures from these changes, they might be reluctant to take on new consumers during the transition phase. Service providers are also concerned that if the new payment arrangement increases administration costs then these costs will be passed on to consumers, which would in turn reduce the level of services that they are able to receive under a package.

The government has not yet detailed the savings associated with the change in these payment arrangements, which are expected to be somewhere in the vicinity of $250 million to $350 million, or what the funds will be used for. With the Royal Commission into Aged Care Quality and Safety to hand down its final report in November, there will be an immense amount of change before the aged-care sector. I would expect that the royal commission might also make a range of recommendations around the Home Care Packages Program that might include ideas about what to do with the unspent funds that have become part of the evidence presented in the hearings. As I indicated, the amount of unspent funds has increased substantially. In fact, it was $539 million as at June 2018 to a current pool of unspent funds of, I understand, around $750 million currently held by providers. ACFA states that this is an increase of approximately $200 million in the last 12 months. According to aged-care accountants StewartBrown, the average unspent funds per client is currently estimated to be $7,000. Given the evidence provided in the Aged Care Financing Authority report, some have put forward their concerns about the increased risk to the financial viability of service providers. As I said, the savings element of the reform is still not clear.

There are questions about why this legislative change is being made now when the royal commission isn't handing down its final report until November 2020. Of course, we have seen this government go off and say, 'We can't do this because of the royal commission and we can't do this because of the royal commission, but we are going to do this one thing and we're going to do this one thing.' It seems to be a very piecemeal approach to reform: every now and then we get some legislation or some sort of announcement to make it look like something is happening. This bill essentially just changes the home-care payment arrangement from advanced to arrears. It is the further changes down the track and, as I said, the possible impact on regional and rural providers that are our concern. The last bill the government introduced was the new commissioner functions bill. I stood in this place at the time and said that I thought it was a missed opportunity and that the government could have and should have strengthened the Aged Care Quality and Safety Commission. It could have been given some powers to arbitrate or to make some more decisive decisions, but of course the government has not yet decided to do that.

Interestingly, the government often says that it can't do things because of the royal commission. Essentially, it hides behind the royal commission. It says: 'No, we're not doing anything until the report'. But, extraordinarily, we did see, just before Christmas, the government make a decision to privatise the aged-care assessment teams. The government made the decision two days before Christmas and popped it up on its website. Then, after two months of everybody saying, 'This is not a good idea; why don't you wait for the royal commission report, as you keep using it as an excuse for everything,' we finally saw the government backflip on it just last week. On Thursday evening the minister said in estimates that he signed a briefing note to change his decision—'the previous minister's decision' was what he actually said—to privatise the aged-care assessment teams because of pressure from the state and territory governments.

Unfortunately, today we saw more confusion between the state and territory governments in relation to the aged-care facility in New South Wales that has been confirmed to have COVID-19 and currently has residents in isolation and staff who have been quarantined. It is very concerning that we still have some disagreements between the states and the territories in relation to how we're managing COVID-19. I look forward to getting a briefing from the government sometime later today about exactly how this is being handled.

Last month marked the third anniversary of the government's Home Care Packages Program coming to a national priority queue. We saw the priority queue grow from the very first announcement, from 88,000 older Australians waiting for home care to now, where we have around 120,000 older Australians waiting for home care. We've seen from the government various announcements—and I will give them some credit here—to try to do something about that. But, as I've said repeatedly and particularly when the Royal Commission handed down its interim report, to do 5,000 packages when you've got 120,000 older Australians waiting for home care is a mere drop in the ocean. This is crying out for very serious major reform. My big concern is the fact that the government keeps putting everything off to the royal commission and does this ad hoc, piecemeal, higgledy-piggledy reform—do this little bit here and this little bit there, say they can't do this for the royal commission but will wait for that for the royal commission.

There doesn't seem to be a clear strategy for aged-care reform. That is the problem. I sincerely hope that, when the government finally gets the recommendations from the aged-care royal commission, which is due in November of this year, they actually have a strategy on how to deal with the reforms, that they actually have a planned agenda on what reform they're going to do in what order and how they're going to do it. We cannot afford, when the aged care system is in such crisis, when we're having serious issues where we now have COVID-19 in one of the facilities, to keep doing this piecemeal, ad hoc reform. Government needs to do better.

I know they're very good at marketing over there and we've got Prime Minister Scotty, who thinks he's very clever about all this, but this is actually about old people getting services. This is people in their 90s, people's parents, aunts, uncles, relatives, brothers and sisters who are crying out for help and this government doesn't appear to be listening. This government appears to think that a bit of smoke and mirrors from time to time, a little bit of assisting 5,000 when you've got 120,000 people waiting, is good enough. It's not good enough, and I will continue to stand up in this place and hold the government accountable when it's not good enough.

We've also seen some issues with the Productivity Commission report this year about the waiting times. Because there are 120,000 people waiting on this list, we of course had the government's own Productivity Commission say that the waiting time for the high level home care packages is almost three years. Once you're approved by the Aged Care Assessment Team, you get told you need services immediately, and there is a three-year wait for this high-level care package. The report, interestingly, also revealed that older Australians are waiting longer to get into residential aged care.

We have seen the government do some things in regards to transparency on some of the home care fees; however, we're still getting reports from people all over the country about rising costs. People are concerned about administration fees, about exit fees and about other fees that they're being charged, and that is limiting the hours and the amount of care that people are able to receive. Former minister Wyatt said he would have a look at this and that he was going to do something about this, but again there doesn't appear to be any action from the government on that. We do need to hear from the government about whether or not it is going to do something about these fees and the concerns that I'm sure they are getting. If we're getting them from all over the country, they must be.

It is incredible to think that the government can do things like change the payment system, make a decision to privatise assessments but make a decision again not to privatise them, but there is no plan for reform. We still don't have mapped out 'This is what an aged-care system in Australia should look like, this is how we're going to get there and we're going to do it over this time period.' Where is the government on this? What we've seen instead over seven years is four ministers. We have seen billions of dollars ripped out of the system. We've seen a little bit of money put back in but nowhere near enough when you're talking about 120,000 people still waiting for home care. We don't have a clear plan from this government. They need to do better.

Our second reading amendment I am going to move reflects our concern about the government's inaction over the past few years. Therefore, I move:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House notes the Government's piecemeal approach to aged care reform".

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