Aug 28, 2017

$17.5 Billion of Taxpayer’s Money Spent on Aged Care Services: Money Well Spent?

Aged care is becoming more of an inevitable future for many Australians. We’re living longer and developing more complex health conditions needing extra assistance at home and in aged care.

But are you aware of how much of the tax payers money is spent on aged care?  or exactly how many aged care workers are in the current workforce?

The Aged Care Financing Authority have recently released a report revealing these numbers, as well as funding and finances, behind Australia’s aged care sector.

The aged care sector provides care to 1.3 million Australians and generates around $21.5 billion in revenue every year.

The sector also makes a significant contribution to the Australian economy, representing almost 1 per cent of Gross Domestic Product.

The Australian Government spending on aged care in 2015-16 was $16.2 billion, which is an increase from the previous year – $15.2 billion in 2014-15.

Government spending on aged care looks like this:

  • $2.2 billion for home support
  • $1.5 billion for home care
  • $11.4 billion for residential care

It’s been estimated that the Government expenditure is approximately $17.5 billion in 2016-17. This is expected to increase to $20.8 billion by 2019-20.

But exactly how much did consumers contribute to their own care? According to the report, consumer expenditure on aged care was $4.7 billion in 2015-16.


Accessing Aged Care Services

Older Australians are a growing populations, and because of that aged care will see a growing demand. Today, people who are over 85 are estimated to be 2 per cent of the total population, however that demographic of of people is estimated to grow to nearly 5 per cent of the population by 2055.

The use of aged care services increases with age – statistics show that the older you are, the more services you require, which is understandable as people may become more dependent as they get older.

Thirty-nine per cent of people aged 70 and over access some form of subsidised aged care. And this number leaps to to 81 per cent for people aged over 85.

In 2015-16, 234,931 older people received services through permanent residential care and 56,852 received residential respite care.

Before the introduction of Consumer Directed Care in February this year, 88,875 older Australians received services through a home care package.

Over 640,000 consumers received services through the Commonwealth Home Support Programme (CHSP) and 285,432 received services through Victorian and Western Australian Home and Community Care (HACC).

Admissions to both home care and residential care have been stable. In 2015-16, the proportion of admissions to residential respite care continued to increase faster when compared with permanent care.

Though the average residential care occupancy has continued to be relatively stable, at 92.4 per cent, in the past few years.

In 2016 Aged Care Approvals Round (ACAR) allocated 9,911 new residential care places.

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The Aged Care Workforce

The 2016 National Aged Care Workforce Census and Survey reported that there are over 366,000 paid workers in aged care along with 68,000 volunteers.

Of theses hundreds of thousands of workers and volunteers, more than half of them work in residential care.

In 2015-16, there were 949 residential care providers who operated 195,825 places.

When compared to the 2012 census, it was revealed that personal carers, in both residential and home care, are more qualified today than four years ago.

People working in aged care tend to work in the sector for a long time, making the workforce relatively stable. Approximately 25 per cent of aged care staff having been working in aged care for over 14 years.

The reason many staff are so committed appears to be because of the high levels of job satisfaction, however there are concerns about wages, time available to provide care and a perception that aged care is not valued highly by the general community.

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