No more waiting: Aged Care Act introduced to Parliament

After the Coalition party set up some unexpected hurdles for the Federal Government, Prime Minister Anthony Albanese and Aged Care Minister Anika Wells have introduced the new Aged Care Act to Parliament today.

Prime Minister Albanese said the Act is the greatest improvement in aged care for 30 years.

At the heart of our Government’s aged care reforms are a simple set of principles: providing dignity, choice, respect and quality of care to older Australians. This is about caring for the generation that cared for us,” he shared.

“Reforms like this don’t happen every day. They are once in a generation and this is very significant.”

The Prime Minister thanked the Coalition for their constructive engagement, as well as Minister Wells for spearheading the reform with the support of Health Minister Mark Butler, Treasurer Jim Chalmers and Finance Minister Katy Gallagher.

He also highlighted several key funding elements, including:

• $5.6 billion for the overall aged care reform package
• $4.3 billion for Support at Home

Other major points include existing aged care participants and those approved for home care packages, but still waiting to access one, will not be asked to contribute more to the cost of their aged care services. This is called a ‘No worse off’ principle.

The ABC has broken down the following changes for future participants only:

In residential care:

• The means-tested daily fee will increase twice a year in line with inflation.
• The maximum amount providers can charge for a room will increase from $550,000 to $750,000.
• When residents pay that charge as a deposit, providers will be able to keep 2% of the deposit every year for two years

In home care:

• There will be three categories of support: clinical care, independence (e.g. showering) and everyday living (e.g. shopping)
• Fees will be means tested. The government will pay for all of clinical care, but self-funded retirees will pay 80%of every day living costs and 50% of independence costs

The legislation includes civil penalties for those who breach standards, highlighting a big win for the Coalition after the exposure draft featured criminal penalties.

Minister Wells called it a historic moment for older Australians, sharing that she does not want anyone to be scared about the care they’ll receive later in life.

“Today we announce a needs based arrangement that makes financial sense. A system that helps more homes have more services for older Australians,” she said.

“Our reforms will create better and safer care, help reduce the fear of a system that has been neglected for far too long.

“I’ve always been ambitious for aged care. And today, with the support of so many, we amplify our ambition with these measures, representing the greatest reforms to aged care in 30 years.”

Minister Wells said the Act and Support at Home will still come into effect from July 1 2025, and there is a target to have home care wait times reduced to three months by July 2027.

The Government will also fully fund clinical care costs, and for every $1 residential care recipients pay, they will pay $3.30. For home care clients, it will be $7.80 for every $1 paid.

Older people will contribute to the “kinds of costs they would typically pay throughout their lives”.

“Many things will change but some important things won’t. The family home won’t be treated any different than it is now. There will not be a levy. Government investment in aged care will rise year on year,” she continued.

Changes will include enough home care support for 300,000 more participants over the next decade, shorter average wait times, eight classifications of up to $78,000 per year, potential access to $15,000 for home modifications and faster access to assistive technology.

Overall, the net impact of the changes is a $930 million spend over four years and a $12.6 billion save over the next 11 years.

“It’s not about new taxes and it’s not about changing the treatment of the family home. This is about better care for more people in a more sustainable way,” Treasurer Jim Chalmers said.

After being introduced to Parliament, the Aged Care Bill will be go to a Senate inquiry next month.