Where do we stand with the new Aged Care Act?

After much deliberation behind closed doors, the new Aged Care Act is set to be revealed in its final form with wealthier people to pay more for their aged care and no criminal penalties for “dodgy” providers. 

Key points

• The Federal Labor Government has been in negotiation with the Coalition over the finer details of the new Aged Care Act with the opposition unhappy to support an Act with criminal penalties and major changes to lifetime contributions caps
• With time running out, the Act needs to be presented shortly so it can be legislated to remain on track for a July 2025 commencement date
• The Australian Financial Review believes the Act could be presented as soon as Wednesday, while Sky News says it could be “guillotined” through Parliament on Thursday

When the exposure draft of the new Aged Care Act was released in late 2023, there were hopes it would be passed into legislation by mid-2024. However, with no details on aged care funding in the exposure draft and a set of recommendations from the Aged Care Taskforce yet to be acknowledged, it was delayed in April.

Few argued against the delay, praising the decision to take more time for planning and preparation.

Some within the industry were worried it would mean aged care recipients would not see the benefits of a rights-based Act. And as the months dragged on with no updates or clear-cut insight into how aged care would be funded, those views had firm ground to stand on.

The Government confirmed the Act would be in effect from July 2025 when it released the 2024 Federal Budget, although few other details were included. 

And now, after several months of indirect back-and-forth with members of the opposition urging for increased transparency over the Aged Care Act, it looks like we’re about to see the Act in full. 

A series of meetings in Canberra last week were rippling with anticipation as rumours of the Act’s imminent release spread. This week, major news outlets and social media alike are confident of its arrival. We even know what the changes should be.

The Government will lower its proposed lifetime caps on how much people can spend on their aged care. The Coalition argued against the abolishment of home care caps and lifting the residential care cap from $76,096 to $190,000.

After significantly winding back the new lifetime cap, the Coalition’s support grew. 

They have also secured a major win with the removal of criminal penalties for aged care directors found guilty of severe wrongdoing. This was an area of concern for many aged care leaders, with concerns it would deter people from entering the sector. 

“Our position on criminal penalties has always been clear. This was not a recommendation of the royal commission. Instead, it was an ill-considered and unconsulted election promise from Labor that would have dangerous consequences,” Shadow Minister for Health and Aged Care Anne Ruston told AFR. 

“Following significant consultation with the aged care sector, it is clear to the Coalition that this measure would force the exit of highly capable staff from the sector in fear of being criminally punished at a level not seen in any other industry.

“In the middle of a severe workforce crisis, this measure poses an unacceptable risk.”

The user pays system or accommodation, food and other services that likely fall under the ‘additional services’ category are also likely to be included in the Act. This was a key recommendation of the Aged Care Taskforce and was mentioned by the Minister for Health and Aged Care Anika Wells during a parliamentary sitting this week.

She also touched on the new Support at Home program, although it’s unclear whether all additional information will be included in the bill or separately. 

The updated Aged Care Act will be welcomed by all, that’s a given. However, if there are still issues, is there enough time to resolve them before the Act is legislated? That’s the next big question.