AN-ACC funding model: hidden challenges that you may have overlooked

SPONSORED – When news first broke of the overhauling of the Aged Care Funding Instrument (ACFI), reports that the new funding model would place the responsibility of assessment in the hands of the Federal Government was a welcome relief to providers and staff overburdened with administrative requirements.

However, since coming into effect on October 1, 2022, the new Australian National Aged Care Classification (AN-ACC) funding model has brought with it a number of new challenges for providers to contend with.

And according to experts, a large percentage are still feeling unprepared. 

As a former ACFI Specialist and the current Funding Service Manager for acclaimed aged care consulting practice Health Generation, Ken Ly has assisted many providers in navigating the criteria required to generate funding.

According to Mr Ly, the first step to AN-ACC preparedness is understanding that providers must remain proactive in their approach to identifying changes in the care needs of residents.

“Initially, a lot of providers may have felt that no longer having to do assessments due to the change to AN-ACC was a chance to relax, but in reality, AN-ACC still requires diligence to generate the right outcomes,” said Mr Ly. 

Unlike previous ACFI protocols that required providers to submit their own assessments, assessors from either an Aged Care Assessment Team (ACAT) or from an Assessment Management Organisation (AMO) now determine the level of funding that providers receive for each resident.

Despite this seeming administrative reprieve, Mr Ly reveals that external assessments still require detailed internal documentation.

“When the assessor or the AMOs come to a facility to assess the resident for funding, they still rely on clinical data that the provider has to produce,” said Mr Ly. 

“The three main methods that assessors employ are reviewing clinical care documentation produced by staff, interviewing members of staff and then assessing the resident’s themselves.”

Growing pains 

While the AN-ACC places less burden on provider resources than the previous ACFI model of funding from an administrative point of view, the new system is actually more complex. 

The AN-ACC model takes into account an individual’s care needs and calculates funding based on the level of care required. However, the algorithms which calculate the funding classification are not fully transparent. 

As a result, it is not easy to forecast AN-ACC funding for financial planning purposes.This increased complexity means that providers may need to invest more resources into training their staff to effectively navigate the new system.

One of the most significant challenges aged care providers encounter under the AN-ACC model is the need to manage funding relative to their staffing and rostering capacity.

The model places a greater emphasis on the utilisation of funding for the provision of direct care to the care consumers.

The provider’s level of AN-ACC funding in each quarter will dictate a minimum direct care minute target that they need to provide in the next quarter. Provider must comply with this target to remain compliant and achieve an optimal star rating, which is also a part of the broader funding reform.

It may also require providers to focus more on continuous improvement, with a greater emphasis on monitoring and reviewing their performance.

Although AN-ACC has removed some of the administrative responsibility from providers, the need to effectively manage staffing resources may actually be even more crucial than before due to the emphasis on providing care that is tailored to the individual needs of each resident.

As a result, providers are seeing an increased need for costly allied health services such as physiotherapy and occupational therapy which are stretching budgets. This need for additional highly-trained staff also places a renewed focus on staff retention and the costs associated with upskilling the existing workforce.

Changing needs

In addition to some of the new potential costs associated with AN-ACC, some providers have expressed concerns that the funding allocated under the new system is insufficient to meet the individual needs of their residents.

Mr Ly said ensuring that residents are re-classified as their care needs change is integral to providers avoiding a funding shortfall.

But doing so will require providers to take initiative.

“Currently, classification of funding will follow a resident until they are discharged from a facility – which generally means until they die or move away,” said Mr Ly.

“However, a resident’s care needs change throughout their care journey, and they need to be reassigned to a different classification to ensure that funding can cater to their needs. But, this process is voluntary and quite complicated.”

After 13 years and the distinction of being Australia’s longest-tenured funding model, most providers had a solid understanding of ACFI and an appropriate management system in place to meet its requirements.

Having worked closely with a number of providers in their transition from ACFI to AN-ACC, Mr Ly and the funding specialists at Health Generation utilise field tested knowledge and a suite of tools to diagnose funding misalignments and put in place a management system that is tailor-made to optimise AN-ACC funding. 

“There has been so much change across the sector recently, and, understandably, many providers have been caught off guard by the new funding requirements,” he said.

“Here at Health Generation, we assist providers in identifying changes that have occurred in their residents and we then help them with the process of applying for re-classification.

“People’s needs can change very quickly during their care journey. Providers that secure the funding that they are eligible for are better equipped to meet the needs of those in their care.”

To find out how Health Generation can help you with your Compliance, AN-ACC Funding, Clinical Services, and knowledge journey – Get in touch here.