Government announces extra aged care funding, home care rollout delays

The Federal Government has made two major announcements regarding the aged care sector with a $2 billion boost to further support the aged care pay rise revealed days after they revealed changes to the new Support at Home Program. 

It’s another partial delay to the Government-funded home care system that has already been pushed back by two years, although the latest announcement focuses on a two-stage process designed to minimise disruption.

Aged care funding increases

• When the Federal Government released the May Budget it committed $11.3 billion to fully fund the 15% aged care pay rise
• This would be made available through the Australian National Aged Care Classification (AN-ACC) price which increased to $243.10 from July 1, 2023
• In addition, the Fair Work Commission had announced aged care award minimum wages would increase by 5.75% in its Annual Wage Review Decision
• At the time the Government had not invested any funds to cover the additional award minimum wage increase

Now, the Government has revealed it will provide an additional $2.194 billion to fund the 5.75% award wage increase for aged care workers. This also means the AN-ACC price rises to $253.82 as of December 1 and it will be back paid for the July 1 – November 30 period to cover all wages.

This will benefit direct care staff such as Registered Nurses (RNs), Enrolled Nurses (ENs), Assistants in Nursing (AINs), personal care workers and recreational activities/lifestyle officers.

The decision was welcomed by the Aged and Community Care Providers Association (ACCPA) CEO, Tom Symondson, who said the investment is a key driver of successful aged care reform. 

“We are delighted the government agrees with ACCPA that increased funding is required now and welcome Minister Anika Wells’ commitment to ensuring providers can continue to operate, for the benefit of older Australians, in these very challenging times,” said Mr Symondson

“It’s very clear from the Government’s own data, that the sector’s financial sustainability is at risk. Without support to fund the 5.75% increase, which providers passed on in full to their hard-working staff members back in July, many providers would struggle to make ends meet.” 

Meanwhile, $21.5 million will also go towards the 24/7 RN supplement funding which helps providers employ additional RNs to meet their 24/7 RN requirements. 

The next AN-ACC price will be announced in August 2024, coming into effect on October 1.

“This decision is vital to residential aged care providers, because it offers greater certainty in the government funding they will receive each year, and will resolve the current issue where budgets are set before wage increases are announced, meaning they often do not match,” added Mr Symondson.

Home care delay allows for adjustments

• The Support At Home Program, which will replace the Home Care Packages (HCPs) Program and Commonwealth Home Support Programme (CHSP) will now be rolled out in two stages
• Originally due to launch in July 2023, the first stage of the launch is slated for July 2025 and it will replace HCPS and the Short-Term Restorative Care (STRC) Programme
• Stage two has been pushed back until at least July 2027 to give providers time to adjust, and this will be when CHSPs are replaced

The Government said the staged approach will give CHSP providers more time to change their business systems and adjust to new payment arrangements.

“We will continue to work with in-home aged care providers to deliver a Support at Home program that will simplify and improve access to services for older people. I have listened to CHSP providers who have advocated for more time to prepare for reforms to ensure they can transition their operations and clients smoothly,” said the Minister for Aged Care, Anika Wells.

These changes may have been influenced by feedback from the Aged Care Taskforce who have offered their advice and feedback on design details, while the rollout may also be waiting for additional pricing information from the Independent Health and Aged Care Pricing Authority (IHACPA).

More information is available at a webinar on December 14 and a pair of Q&A sessions