Star Ratings under fire: Are they hiding the truth? 

A blistering report has put the Aged Care Star Ratings system on notice yet again after finding that the majority of aged care facilities with instances of non-compliance have still secured 3 or 4-star ratings.

The report penned by Adjunct Professor Rodney Jilek, “Groundhog Day” The Continuing Failure of the Aged Care Star Rating System, states that no progress has been made to improve the transparency, accuracy and ease of use of the Star Ratings System. 

In fact, he believes ratings are being inflated, particularly as residential care homes that have failed up to seven of the eight accreditation standards still earned 3-star or higher ratings. 

“The result of this, which can reasonably be considered a deliberate act, is to overinflate the overall Star Rating score and present the sector as performing far better than it actually is. The fact that anyone believes this is appropriate is absolutely mindboggling,” he emphasised. 

Dr Jilek also stated that the Aged Care Quality and Safety Commission is ‘woefully inadequate’ when managing non-compliance, while overall, My Aged Care and the reforms implemented have been an ‘unmitigated failure’.

Stumbling star ratings: How did we get here?

• The Star Ratings system was implemented in response to a key recommendation from the Royal Commission into Aged Care Quality and Safety, aiming to provide a simple way for families and individuals to make informed choices about care providers
• Star Ratings were officially launched in December 2022 by the Australian Government Department of Health and Aged Care. It was designed to distill complex performance data into a simple 1-to-5-star scale
• The system assesses all government-funded residential aged care homes across four key sub-categories: Residents’ Experience (33% weighting), Compliance (30%), Staffing (22%), and Quality Measures (15%). These sub-categories combine to produce an Overall Star Rating.

Just over a year ago, Dr Jilek released his first report as part of Aged Care Consulting & Advisory Services Australasia. In it, he found serious inaccuracies within the Aged Care Star Ratings system, highlighting the repeated red flags surrounding non-compliant providers that still secured three-star or higher ratings.

Soon after, Peter Edwards, Executive Director of Compliance Management Group (as part of the Aged Care Quality and Safety Commission) published the following statement,” 

“A finding of non-compliance in itself does not impact a service’s star rating; rather it is only where the Commission then uses its formal powers to require a service to take corrective action that a service’s star rating will be impacted,” Mr Edwards said.

“As a risk-based regulator, this approach is important because we want to create an environment where providers are incentivised to actively engage with us and demonstrate that they are willing to take necessary action to self-correct as soon as possible when things go wrong.

“That’s because it creates an incentive for providers to get ahead of the regulator and start to address non-compliance in advance of the Commission needing to intervene.”

This could see an aged care home hold a 3-star rating if all non-compliance has been resolved, which could mean no formal regulatory notices were in place for up to a year. A compliance notice should see a home drop to 2 stars for the relevant issue, while a Notice of Decision to Impose Sanction or an Issuance of Infringement Notice would result in a 1-star rating.

Star ratings at odds with non-compliance

Dr Jilek’s follow-up report found that half (50.6%) of the aged care homes listed on the Non-Compliance Register were awarded 4-star ratings while 34.8% held a 3-star rating.

In addition, four services received a perfect 5-star rating despite failing their accreditation. Less than 4% had a 1 or 2-star rating, and 8.2% had no rating.

As part of his assessment, Dr Jilek identified the ‘eight worst performing residential aged care services in the country’, according to the Aged Care Quality & Safety Commission. 

This included St Charbel’s Care Centre in NSW, Merrimac Park Private Care in QLD and Grace Villa Aged in Victoria. 

Yet despite all of the homes having non-compliant services in most Quality Standards, they were awarded a range of ratings between 1 and 5 stars. 

“If I was the owner of those who received 1 or 2 Stars, I would be asking some very pointed questions of the Minister and wondering who you annoyed at the regulator to get your Star Ratings when others with identical or very similar failures maintained their 4 Star Rating (and in some instances, ratings actually went up following non-compliance),” Dr Jilek added. 

“Given the breadth of non-compliance, every single one of them should have received a 1 Star rating and the fact they didn’t exemplifies the failure of the system.

“If 4 Stars is meant to equal better than most but that also equates to systemic accreditation standards failure, we would hate to see how 2 and 3 star services are performing.”

In the case of Merrimac Park Private Care — which was deemed to have appropriate 1 or 2-star ratings — Dr Jilek went on to highlight ongoing Standards failures over the course of 14 months that never resulted in sanctions until December 2024. 

In fact, it saw its accreditation renewed until March 4, 2027, after it was found non-compliant with six standards throughout 2023 and 2024. The home’s intent to resolve the issues was noted in several instances, although the several appeared to go beyond surface-level solutions. Detailed audit reports are located here.

Ultimately, the Commission determined not to revoke and to vary its accreditation, with the accreditation period set to expire on December 17, 2025.

Mutkin Residential Aged Care was found non-compliant in three Quality Standards yet it held 4 or 5-star ratings. 

The home, which offers culturally appropriate care for Aboriginal and Torres Strait Islander people, was found to have a workforce that was not fully trained and equipped in key areas such as the use of restrictive practices. According to My Aged Care, 92% of residents were subject to restrictive practices. 

Organisational governance also fell short in terms of financial management and care management. 

Despite the issues — which are not as widespread as other organisations listed in the report — Mutkin Residential Aged Care saw its overall Star Rating improve to 5 stars after the October 2024 audit. 

Can the public trust the data?

The main intention of the Star Ratings is to give the public an easy way to compare and analyse providers, yet the issues plaguing the system give no certainty on compliance or quality.

“It remains impossible for the general public to obtain a clear, accurate and concise picture of sector performance due to the cumbersome and disjointed way data is stored and presented across multiple websites and given the timeframe since this was first highlighted, it would appear that this is deliberately done to mislead,” Dr Jilek said. 

Elsewhere, Bolton Clarke Executive General Manager Policy and Advocacy, says the limitations of the Quality Indicators calls into question their suitability as a tool for differentiating homes based on quality.

He says the clinical indicators typically have quarter to quarter variations that are unlikely to indicate meaningful changes in care quality, with ‘random’ elements such as unplanned weight loss likely to have unobserved characteristics that could add necessary context. 

Other Quality Indicators such as falls could also mean residents are supported to be more active, meaning there is heightened risk of falls rather than falls occurring in an unsafe environment.

“The resident experience score carries the most weight. But the relative ranking of aged care homes is mostly noise,” he added.

“I base this statement on the fact that there is only a small correlation between the scores that homes get from one year to the next…. A home’s score from the previous year only explains about 10% of the variation in scores. 

“Some homes get better and others get worse. But such a weak relationship says to me that most of the variation is just random – driven by who gets selected for the interviews and who happens to be living in the home at the time.”

Is anyone listening? 

Fifteen months after Dr Jilek released his first report into the Aged Care Star Ratings system, is anyone listening to the feedback? According to him, no. 

“Despite a plethora of negative commentary since our initial paper was published in January 2024, the Aged Care Minister has resisted calls to make wholesale changes to the scheme claiming the Aged Care Star Rating System is working as it was designed,” he said.

“This is despite scathing reports from the Inspector General of Aged Care and the Commonwealth Ombudsman and clear sentiment from advocacy groups and the sector more broadly that it is not fit for purpose.”

An independent evaluation of the Star Ratings is underway, although no information has been shared. Commonwealth Ombudsman Iain Anderson said he would have conducted his own investigation had the Department of Health and Aged Care not started its own. 

The Australian Government, if re-elected in the May 3 election, has committed to investing $3.6 million to support an evaluation and stakeholder engagement in a review of the Aged Care Quality Standards. 

This could have been a great opportunity to allocate additional funds to public evaluation of the Star Ratings system. Unfortunately, Dr Jilek believes this could be a can that’s ‘kicked down the road’ to become someone else’s problem.