The pitfalls and opportunities of change and pricing autonomy

It is generally true to say that change is less welcome than not. Change tends to disrupt the status quo, brings uncertainty, add workload as well as pressure. Overall, change is not embraced by most.

That is entirely true of the current government change from Home Care Package (HCP) and eventually Commonwealth Home Support Programme (CHSP), to Support at Home (SAH). A clever idea, possibly, as it reflects the changing needs of the community and its continuing desire to receive more complex services in the home.

It has its challenges and issues, but those are unfortunately numerous. Too little time to change in a controlled manner, too little information to allow the required preparation, too little understanding by the “change agents” of the real impact on those who have to implement the change and also those who support the industry, such as software developers, consultants, training staff and support staff.

Communication is only one part of the equation, followed by education, assimilation, implementation and finally operation. 

In this case, I am not sure which wizard came up with the idea that this significant change to the current community care programme could be fully implemented on 1 July 2025.

System transitions require data transfer and staff to be familiar with the new rules, new software, and a detailed change process by which a seamless transfer can occur.

This takes time. Software needs to be upgraded or rewritten, training materials developed, training staff and support staff familiarised with the changes and then implementation and system “bedding down”, to ensure that it functions correctly, in what will be an even more complicated system than before.

All facets of the change need to be ready if providers are to provide uninterrupted quality services to existing and any new recipients in the community.

A tall task clearly, but achievable, albeit in a high-pressure situation, if all elements fall into place as planned. Yet, the big question remains – was it necessary to do it in one day rather than phase it in over 6-9 months?

The net result would have been the same, but the ability of all stakeholders to deliver the best outcome for community recipients would have been greatly enhanced. Unfortunately, not to be!

From a software provider’s viewpoint there are additional constraints that need to be met, such as:

• Being fully functional well ahead of the 1 July 2025 commencement date.
• ISO 27001:2022 certification for cyber security protection (not mandatory but necessary for data security in the current climate).
• Software penetration testing to ensure software reflects enhanced cyber security.
• Compliance with Department requirements to gain access to B2G (Business to Government) portals for automatic data transfer and metrics.
• New requirements to be met for early claiming and reporting.
• Software is fully tested and operational.
• Training and operational manuals prepared.

In addition to the above, providers will be aware that for the first year of the new SAH arrangements the Department will not be prescribing rates for services. This issue is probably the most vital confronting providers as it has longer term consequences. Therefore, the question is “What rates should be charged and how do you calculate them?”.

From industry experience, I am aware that there are various methods providers employ for calculating a service pricing model:

• Continue with the existing home pricing [where applicable], often without checking to see if it continues to meet the organisation’s current financial goals and objectives.
• Copy the pricing of another provider where that information becomes available.
• Guess, and for those who are more astute;
• Use a scientific approach for service cost calculation, by adopting a formal costing approach.

We recognise that calculating the price for delivery of services to the community is difficult, but the pricing data in the first 12 months of the SAH operation will significantly influence future pricing. The Department will collect and use the pricing data over the first 12 months to decide on pricing going forward.

The industry will wear the outcome of poor pricing decisions resulting from the initial 12 months of self-pricing, if it is not done correctly.

It behoves the industry to get this right or suffer the consequences of a future pricing regime that does not provide sufficient funds to meet a viable, quality service.

One which, in addition to supporting a quality service, generates sufficient surplus that allows for reinvestment, capital upgrade of plant and equipment, as well as a return to its investors.

To assist with pricing, e-Tools Software is currently in the process of developing a Pricing Model for providers, to help them establish a realistic price for each of the services they offer.

This pricing outcome will then form an integral part of the new e-Tools SAH software application [eSAH], developed to meet the following outcomes:

• Meet all the compliance requirements detailed by the Department.
• Have a data importer to allow easy transmission of historical data.
• Provide structured operational workflow for processing.
• Meet the Department’s requirements for B2G and cyber secure portal access.
• Be robust, yet easy to use.
• Be a value for money product.

e-Tools has over 150 home care software users who will be making the transition on 1 July 2025, and a further 80 home support users who will follow suit in 2027. Clients will be introduced to the new eSAH software in early May, to ensure they will be operationally ready to commence from 1 July 2025. 

Ensure you have a reliable software provider with proven experience to provide IT leadership. Please contact e-Tools Software to enquire about the Pricing Model and essential guidelines to transition to Support at Home on time. Visit e-tools.com.au for details. 

This article was written by David Powis MBA, Managing Director of e-Tools Software Pty Ltd.