Apr 29, 2021

Why do aged care residents receive one-quarter of the funding of NDIS recipients?

The report shows that the average annual NDIS support package is about $52,000, while the average annualised aged care support package is approximately only $17,000, though direct comparisons between the two systems are complex.

“The estimated participant equivalent allocation of total Government funding for the aged care program is suggested through this analysis to be near one-quarter of that allocated through the NDIS. Research on older people in the NDIS further confirms this disparity,” the report states.

While NDIS participants receive whatever support is considered “reasonable and necessary”, and there is no cap, aged care residents are classified into bands with capped funding.

“There is a substantial difference in support between aged care and NDIS programs,” the report states. 

“This appears to reflect differences in the hours of care available, though differences also exist in the level of support for reablement, social engagement, behaviour support, care management and assistive technology.”

The Royal Commission into Aged Care Quality and Safety described Australia’s aged care system as “unacceptable” and “unsustainable”, and raised the issue of the NDIS receiving higher funding per recipients than aged care residents. The commissioners recommended increased funding to the sector “based on need” and “not rationed”. 

NDIS maximum almost $500,000

As of September 2020, NDIS participants with high needs (41% of recipients), have average annual support of about $200,000. Those with the highest impairments average a package of $493,170.

For those with moderate needs (42%), annual support was $61,000. The average package for those with low needs (16%) was $22,000.

Aged care maximum $139,000

In aged care, about 67% of participants received basic home support through the Commonwealth Home Support Program, which is about $3,000, on average, annually. 

LASA CEO, Sean Rooney, said, “Given CHSP clients account for two-thirds of all aged care recipients, this amounts to a substantially lower level of overall funding being made available.”

Funding putting a “halt” on aged care

Clayton Hutchinson, whose family has owned Canberra Aged Care home for more than 30 years, told HelloCare the aged care sector has been underfunded for more than 12 years.

Since some ACFI supplements were pulled from residential aged care, there has been a “halt” in the industry, and about 150 providers have exited the sector.

“Not many want to invest in an industry that’s running backwards,” Hutchinson said.

With smaller providers falling by the wayside, the industry is heading towards a “Coles and Woolworths”-type situation with a small number of large operators. “Nobody wants that,” Hutchinson said.

Without enough funding in aged care, providers won’t hire that extra staff member, or they’ll begin purchasing substandard products because they’re cheaper, “just to keep the doors open”.

Hutchinson said the NDIS is paying inflated prices because of “open cheque book” policies.

Less funding means fewer hours of care

“Overall we see less funding per aged care recipient and this results in fewer available hours of care when compared with NDIS participants, plus there are limits placed on funding in aged care for reablement, social engagement, behaviour support, care management and assistive technology,” said Rooney.

“This often leaves aged care recipients, particularly in home care, contending with unmet needs.”

Rooney told HelloCare, “We support NDIS recipients receiving their funding and care. 

“However, aged care is capped within set bands and we believe older Australians should receive funding based on their need.

“We support the development and implementation by July 2024 of a new uncapped and better integrated aged care program comprising respite, social supports, assistive technology and home modifications, and care at home, with funding based on a mix of block and activity-based funding and personal budgets, and maximum funding amounts for care at home linked to care funding in residential care.”

Inadequate funding impacts older people, staff, providers

“Without aged care recipients having access to adequate levels of funding support … the level, quality and outcomes of the care and support they receive may suffer,” said Rooney.

“This ultimately increases pressures on older people, the aged care workforce and providers of services.

“System settings need to be focused on the respect and essential human rights of our elders, so they can access reasonable and necessary supports matched to assessed needs.”

You can read the report in full here – Comparing aged care and NDIS support: A funding analysis

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  1. You cannot compare the two systems. The NDIS is a system based upon the individual which is enabling and promotes independence. It is based upon “support”. Funding is often based on staffing ratios that are much higher than even the very best aged care staffing levels.

    Residential aged care on the other hand is based on an economies of scale mentality – providing care to large numbers of people with the smallest amount of resources, including staff. It focuses on providing “care” based on dependency and encourages dependence. We routinely see staff ratios of 1:10, 1:20, 1:50 with a major focus on groups not individuals. The individual is constantly compromised to fit the needs of others.

    Aged care needs a complete paradigm shift and change of focus if it wants better funding – not just more money to do the same old thing.


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