Jul 27, 2017

Aged Care Spot Checks: Who Should Pay?

It was recently announced that Australian Aged Care Quality Agency are planning to charge operators to conduct annual unannounced spot checks on them.

Approximately every three years aged care facilities are audited to ensure that they have met the accreditation standards set by government agency.

In addition to these audits, every year there is at least one “unannounced spot check”.

To ensure the best quality care is given and that aged care facilities are offering the adequate level of service all year round, it is believed to be essential that these random spot checks are done.

In light of this new announcement, questions has been raised; should aged care operators have to foot the bill or is it a cost that the Government should incur to protect our elderly?  

Australian Aged Care Quality Agency outlined in the Cost Recovery Implementation Statement (CRIS) 2018-19 that “the cost of the annual unannounced site visit conducted by the Australian Aged Care Quality Agency will be payable by approved providers of residential aged care services”.

Wayne Belcher, CEO of Aged care operator Braemar, says the proposed changes will place a burden on already stretched Aged Care providers.

“The proposal suggests that providers pay for both the existing accreditation process, as well as pay AAQCA to do one of their mandated Unannounced Visits. This is a cost of between $2,700 to $5,880 – per facility, per annum.”

“It could add, as I understand it, between 50% to 90% of the accreditation cost to providers. This change is to cover the cost of the AAQCA – not the cost of care and is too high to be afforded by the providers of our aged care services for an industry specific quality assurance system.”

The proposed changes, which are set to begin from July 1st next year, means aged care organisation will take a hit in terms of funding.  

Aged care providers view this “cost recovery” as an indirect $10 million per year reduction in subsidies by Government – meaning that part of the federal funding they receive will go back to the Government to pay for these unannounced spot checks.

There is also the risk that, in order to cover the cost of the spot checks, aged care organisations will be forced to increase the rates residents and their families have to pay for aged care services.  

ACOL 1

Industry peak bodies representing private and not-for-profit aged care operators have all spoken against the new “Cost Recovery Implementation Statement”.

Cameron O’Reilly, CEO of the Aged Care Guild, told HelloCare that “our view is that the proposed charging for unannounced visits is another hit to the funding of the industry and on top of ACFI cuts is taking money from the core business of care”.

“It is not a service to the industry and not good practice to have providers funding a core regulatory responsibility of the Agency.”

“It is also occurring at a time where there are two major reviews into quality in the industry (Senate and Carnell) which could lead to further changes to the regulatory framework and potentially increase unannounced visits and therefore the costs to the industry.”

“We have urged the Quality Agency to review the need for, and appropriateness of this measure.”

Pat Sparrow, CEO of Aged & Community Services Australia says that, “ACSA strenuously objects to the proposed new levy for unannounced site visits on the grounds that it is both inappropriate and not lawful.”

ACSA noted that under the current Australian Aged Care Quality Act 2013, the Australian Aged Care Quality Agency has no authority to impose the new “levy”.

“Our view is that these visits are not a ‘service’ to the provide – as it relates to s15 of the Australian Aged Care Quality Agency Act 2013 – but, rather, part of routine compliance management. As such, it is our view that any cost should be borne by the Australian Aged Care Quality Agency rather than the provider.”

“The proposed levy imposes another significant cost burden on Aged Care providers – at a time when the costs of compliance and accreditation have already increased significantly. This levy represents an unnecessary cost for Aged Care providers at a time of significant financial strain.”

“ACSA is concerned that the introduction of a levy for ‘one unannounced site visit per annum’ may be the first step towards the eventual introduction of a levy for all unannounced site visits.”

Leading Age Services Australia CEO, Sean Rooney, is also in agreeance expressing its members “strongest protest against the Australian Aged Care Quality Agency’s (AACQA) plan”.

“LASA is strongly of the view that charges for unannounced visits should not proceed.  It places unreasonable and additional financial burden on providers and potentially, it undermines the perceived independence of the accreditation process.”

“LASA Members have strongly expressed their frustration at continuous reductions in Government subsidies for the care and services they provide. Providers are still dealing with changes to ACFI scoring, the one-year freeze on indexation of ACFI subsidies in 2017-18 and the removal of the payroll tax supplement, among other recent measures.”  

Aged Care Guild, Leading Age Services Australia and Aged & Community Services Australia are united in their stand, “our industry is as one in rejecting the AACQA’s plan to charge for unannounced visits”.

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  1. I would be interested to learn about more insights from these leaders on how we could better structure revenue for care providers such that consumers set the quality standard rather than revenue being mostly provided by government on lowest common denominator basis…. economic incentive after all drives behaviour. great to see this critical topic being openly debated here. More pls!

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