The current advice landscape for aged care
Aged care demand continues to grow. The recently released 2016-17 Report on the Operation of the Aged Care Act 1997 highlights that the ageing population and increasing number of people with dementia are two key factors driving this demand. The report also explores the current state of the three main types of care that the Government provides to assist older Australians.
Aged care demand
In the report the Minister for Aged Care, the Hon Ken Wyatt AM MP states “our aged population is growing at an unprecedented rate”.
As at 30 June 2017, there were 499,000 Australians aged 85 and over. In ten years’ time there are projected to be 672,000 aged 85 and over, an increase of 35 per cent. The number of people aged 65 and over is also expected to increase from 3.8 million to 5.2 million by 2027.
This projected growth in the ageing population suggests a substantial increase over the coming years to the 1.3 million current consumers of aged care services.
In 2017, there were an estimated 365,100 Australians with dementia, nearly half of whom were aged 85 years and over. The number of people with dementia is anticipated to grow to around 900,000 by 2050.
This increase in dementia cases is also adding to the growing demand for aged care. At 30 June 2017, half of all residential aged care residents with an Aged Care Funding Instrument (ACFI) assessment had a diagnosis of dementia.
In financial year 2016-17 the Australian Government spent $17.1 billion on aged care, of which 70 per cent of expenditure was for residential aged care.
But whilst the traditional image of aged care is often associated with residential care, Wyatt said that “today the focus is on supporting people to stay in their own homes for as long as possible. Consumers have made it clear that this is what they want, and it also makes good economic sense”.
The two main forms of Government subsidised home care are the Commonwealth Home Support Program (CHSP) and home care packages.
Commonwealth Home Support Program
Through financial year 2016-17, 722,838 people received services through the CHSP, and an additional 74,475 through the Western Australian Home and Community Care (HACC) program.
The CHSP is entry-level home support with a range of services to assist people aged 65 and over to live independently at home and in the community.
Types of services which are funded through the CHSP include:
- Meals and other food services
- Transport
- Personal care
- Home maintenance and modifications; and
- Nursing.
To access the CHSP clients must have an assessment by a Regional Assessment Service (RAS). Clients can contact My Aged Care to organise an assessment.
The My Aged Care staff will ask questions about the client’s current needs and circumstances to determine eligibility for the CHSP and organise an assessment if required.
For CHSP clients who need a greater level of care but still want to stay in their home, then a home care package may be the next appropriate step.
Home care packages
Home care packages are a more holistic form of care than the CHSP. They can be tailored to meet clients’ personal needs with the help of case management, known as Consumer Directed Care (CDC).
Services which can be chosen by the client include personal care, support services and clinical services.
Access to a home care package is by approval from an Aged Care Assessment Team (ACAT) assessment, or Aged Care Assessment Service (ACAS) in Victoria, which, like a RAS assessment, can be organised by contacting My Aged Care.
An ACAT/ACAS assessment can approve an individual for Level 1 (basic care needs) up to Level 4 (high-level care needs).
With the growth in aged care demand and the Government support for care at home, home care packages saw significant growth and change through 2016-17.
The number of home care consumers as at 30 June, 2017 was 71,423, an increase of 7,354 or 11.5 per cent from 30 June 2016, with the average age of entry being 80.2 years (unchanged from 2015-16).
As at 30 September, 2017 there were 101,508 ACAT/ACAS approved persons waiting in the queue for either their first home care package or on an interim package.
Whilst the statistics regarding the length of the queue are not available, Mr Wyatt commented in September 2017 that “across the nation it’s 12 months plus.”
Clients can check their My Aged Care portal or call My Aged Care to check their individual expected wait time.
The report confirms the current fees which a home care recipient may be required to pay:
- Basic daily fee – the maximum is 17.5 per cent of the single rate of the base Age Pension; and
- Income-tested care fee – paid by those assessed as having sufficient income to contribute to the cost of their care.
Strategies that reduce a client’s assessable income can help to reduce their income tested care fee and improve cash flow.
Permanent residential aged care
For clients who are unable to receive the level of care they need from a home care package, the Government subsidises permanent residential aged care.
This includes services such as personal-care services (help with daily activities such as dressing, eating and bathing), accommodation services and support services (cleaning, laundry and meals).
Access to permanent residential aged care, like for home care packages, is through approval from an ACAT/ACAS assessment.
At 30 June, 2017 there were 178,713 people receiving permanent residential aged care, an increase of 2,724 from 30 June, 2016, which is a significantly lower increase than the 11.5 per cent increase in home care package recipients.
The average resident is 82 years for men and 84.6 years for women and the average length of stay is aged care is 2.9 years, which may be useful when determining a planning timeframe for aged care clients. However, this is an average and previous statistics have shown that about one in five residents stay in permanent residential care for five years or more.
Additionally, the report confirms the Government’s current structure of fees which care recipients may be required to pay:
- Basic daily fee – all residents can be asked to pay this fee which is used to cover costs such as cleaning, maintenance and laundry
- Means-tested care fee – calculated based on an assessment of the resident’s income and assets
- Extra and additional service fees – an itemised account must be given to the client once the service has been provided:
- Extra – providers which have been approved to provide extra services can charge residents for higher than average services such as accommodation, food and recreational services
- Additional – fees charged for services which a resident has asked the provider to provide and must be agreed with the resident before services are delivered; and
- Accommodation payments – for the cost of accommodation which can be paid as a lump sum, a daily amount, or a combination of both.
On top of guiding clients through application and entry into permanent residential aged care, strategies to reduce a client’s assessable assets and assessable income can help to reduce their means-tested care fee, improve their cash flow and achieve estate planning outcomes.
Michael McLean is a technical services analyst at Challenger.
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