Apr 06, 2022

More aged care homes at risk of closing if providers forced to pay higher wages

Treasurer Josh Frydenberg dodged questions on the weekend about whether the government would fully fund pay rises for aged care workers.

“When it comes to government provision of residential care we take responsibility for that,” he said on the ABC’s Insiders program.

“There’s an independent pricing authority that determines, based on all the input costs, what that increase in subsidy will be,” he said, but failed to be drawn further on the topic.

With nearly 60% of all aged care facilities already operating at a loss, the treasurer’s comments have raised concerns nursing homes will be forced to close if operators have to chip in for the widely expected pay rise.

The Fair Work Commission is expected to finalise an increase for aged care workers soon, after unions lodged claims for a 25% pay rise.

The Opposition party has pledged to fully fund the increase.

The latest report from aged care accountancy expert StewartBrown revealed that in the September 2021 quarter, the average operating results for residential aged care homes across Australia was an operating loss of $7.30 per bed per day, despite the additional Basic Daily Fee supplement of $10 per bed day.

More than half (56%) of homes made an operating loss. 

Leading Age Services Australia chief executive Sean Rooney told the Herald Sun that at least half-a-dozen facilities had already closed this year due to “chronic underfunding”.

“The ability to consistently meet the needs of people in care has been compromised.”

Mr Rooney said the treasurer was “confused”.

Of the new funding model, he said, “It’s still allocating a pie and if the pie is not big enough, it doesn’t matter how you slice it.”

The Independent Hospital and Aged Care Pricing Authority (IHACPA) will only inform government decisions on funding increases in residential aged care from 1 July 2023 for the 2023-24 year.  

StewartBrown senior partner Grant Corderoy told the Herald Sun it would be a “disaster” if providers had to chip in to cover higher wages for staff. He expected “more homes to close” if they did have to pay higher wages.

Opposition aged care services spokeswoman Clare O’Neil told Herald Sun that Frydenberg’s comments were a “desperate diversionary” move.

She said “many aged care homes will close” if the government doesn’t fund the cost of wage rises later this year.

The situation risks escalating into a “national catastrophe” if it fails to do so, she added.

Leave a Reply

Your email address will not be published. Required fields are marked *

Advertisement
Advertisement
Advertisement

“What does your aged care facility supply in its staff room?”

“It’s not hard and it doesn’t have to be expensive”: When an aged care worker shared details of his well-stocked staffroom, others working in the sector said they’d like to work there, too. Aged care employers that show they care for staff are likely to be recruiters of choice. Read More

New aged care regulation: Why falls and medication management must be reported from July 1

From July 1, aged care providers will have to report on falls and medication management for the first time, adding to reporting on pressure injuries, use of physical restraint and unplanned weight loss, as part of the government’s compulsory quality indicator program. Read More

Childhood Dementia Initiative set up to to create awareness and uncover the shocking impacts of childhood dementia

With more than 70 disorders causing Childhood Dementia, an estimated that 1 in 2,800 children are born with a disorder that, if untreated, leads to childhood dementia. Read More
Advertisement
Exit mobile version