Bills Digest No. 135 2004–05
Aged Care Amendment (Transition Care and Assets Testing) Bill 2005
WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced
and does not canvass subsequent amendments. This Digest does not have
any official legal status. Other sources should be consulted to determine
the subsequent official status of the Bill.
CONTENTS
Passage History
Purpose
Background
Main Provisions
Endnotes
Contact Officer & Copyright Details
Passage History
Aged Care Amendment (Transition
Care and Assets Testing) Bill 2005
Date Introduced: 10 February 2005
House: House
of Representatives
Portfolio: Health and Ageing
Commencement: The
measures commence on the date of Royal Assent except for Schedule 2 which
commences on 1 July 2005 or on the date of Royal assent, whichever
is the later.
The aim of the amendments to the Aged Care Act 1997
contained in this Bill are twofold. The first set of amendments
are designed to allow for more flexible care arrangements for older Australians
who have been in hospital and who may be more appropriately placed in
transition care arrangements (which could include, for example, intensive
rehabilitation) before returning to a home environment or to a residential
care environment. The second set of amendments will see, from 1 July 2005,
the transfer of assets testing of residents or prospective residents in
residential aged care to Centrelink, and for veterans, to the Department
of Veterans Affairs. Currently, assets testing of residents or prospective
residents is done by residential care providers.
Both these amendments arise from recommendations contained in the recent
Review of Pricing Arrangements in Residential Aged Care: the so
called Hogan Report or Hogan Review(1).
The Commonwealth provides a range of support to older Australians
in terms of their residential and community care needs.
Residential care includes the provision of high care beds (formerly called
nursing homes) and low care beds (formerly called hostels). Substantial
Commonwealth funding is provided to approved residential care providers
to help them care for older Australians in these residential settings.
In 2003-04, 10.4% of people aged over 70 years of age (equating to 189,929
older Australians) were in permanent residential care(2).
The two main types of community care are Community Aged Care Packages
(CACPs) and the Home and Community Care Program (HACC). The former is
solely funded by the Commonwealth and the latter is a joint Commonwealth-State
funded program. CACPs are designed to keep older people who have been
designated for a low care residential place in their own home or family
setting for as long as possible. This is done by bringing a range of support
services to them (for example, nursing support, meals, domestic help)
thereby enabling them to stay in their own homes. The Home and Community
Care Program (HACC) also provides similar services to a number of older
Australians, but unlike CACPs which are specifically designed to mesh
in with the residential care system, the HACC Program is a much broader
program which helps a wide range of people in need, most notably people
with some form of disability.
In 2003-04, almost 40,000 people received care via a Community Aged Care
Package(3) and approximately 707,000 people received some form
of support from the Home and Community Care Program(4).
As well as residential and community care there is a category of care
for older people that aims to provide maximum flexibility and offer additional
options for care that may not exist in the mainstream residential system.
The three main types of flexible care are Extended Aged Care at Home (EACH)
packages, Multipurpose Service places (MPSs) and Innovative Care Places.
The EACH program is similar to the CACP program but in this case it provides
in-home services to people who would otherwise be in a high care place
in a residential care facility. As at June 2004, there were 928 EACH packages
across Australia(5). The MPSs program is a joint Commonwealth-State
initiative that delivers a mix of aged care, health and community services
in small remote communities. Often these communities are not big enough
to provide separate stand alone services in these areas and MPSs enable
them to combine services in the one location. In June 2004 there were
88 MPSs across Australia(6).
Innovative Care Services provide a range of flexible and alternative
care options essentially by trialling various care options through time
limited pilot programs. The Transition Care Program which is being established
by the first set of amendments in this Bill, comes following successful
pilot projects covering the care of older Australians who have left hospital
but who are not yet ready to go home.
In effect, the new Transition Care Program builds on what has been happening
with some of the trials being undertaken in Innovation Care Services.
This Bill will allow for the provision of 2000 new transition care places
over three years for people who have been in hospital and who are seeking
more time and support before returning to the community or to residential
aged care. The aim of the new places is to provide more appropriate care
settings and better integrate hospital and aged care services. Additional
and better rehabilitation and therapeutic services should be available
to older people who access these new transition places.
Currently, a number of older people face the risk of needing a higher
level of care when they leave hospital if they are not able to access
appropriate rehabilitation services.
The Bill ensures that leave arrangements are available to existing residents
in aged care facilities so that they can have access to transition care
following a stay in hospital. It will also mean that such residents will
be able ‘keep their place’ in the care system and, for example, go back
to their bed in a residential facility following their time in transition
care. According to the Explanatory Memorandum:
The Transition Care Program will assist people to return
to their homes or to lower levels of residential aged care by providing
a mixture of time-limited aged care supports and therapeutic care, such
as rehabilitation.
The need for more flexible care arrangements in aged care was highlighted
in the Hogan Review on aspects of the aged care system. Hogan said:
In the main, the current planning arrangements for the
release of new aged care places are not able to respond as flexibly
as is desirable for the development of new care approaches or to encourage
innovation in service delivery. This has been addressed to an extent
by the introduction of the Innovative Pool of flexible care places,
which has trialled services linked to the acute care-aged care interface,
the disability-aged care interface and dementia care. These opportunities
should be enhanced(7).
The second set of amendments contained in the Bill were also recommended
in the Hogan Review. Currently, the assets testing of people in residential
aged care is carried out by the aged care providers themselves. Providers
of residential aged care need to do this testing to ascertain whether
they can claim a concessional resident supplement or an assisted resident
supplement from the Commonwealth. These supplements are based on the assets
information provided by the resident prior to entry into residential aged
care.
The Hogan Review considered that Centrelink was in a better position
to carry out assets testing of residents in aged care. According to the
Review…
Assessment of residents’ or prospective residents’ income
and assets should be the responsibility of the Australian Government
and carried out by Centrelink and not the aged care provider, preferably
prior to entry into care(8)
The Bill allows assets testing to be done both prior and after entry
into residential care. By having Centrelink (and in the case of veterans,
the Department of Veterans’ Affairs) undertake the assets testing of all
new residents a significant administrative burden should be taken away
from the providers of residential aged care. The new testing arrangements
are due to commence on 1 July 2005 and existing residents in aged care
facilities are not affected.
The 2004-05 Commonwealth Budget provided a total of $19.7 million over
four years to enable the transfer of assets testing to Centrelink and
the Department of Veterans Affairs.
The Bill also provides for an extension to the current seven day period
after a person enters an aged care facility, in which they must enter
into an accommodation bond (for low level or hostel care) or accommodation
charge (high level or nursing home care). Residents, according to this
Bill, would now have twenty one days to enter into such an agreement.
Item 1 of Schedule 1 creates a new category of leave from residential
care for those receiving flexible care.
Item 3 of Schedule 1 provides for the reduction of residential
care subsidy when a care recipient is on flexible care leave for at least
30 days.
Item 7 of Schedule 2 adds new sections 44-8AA and 44-8AB
to the Aged Care Act 1997. The new section allows the Secretary
of the Department of Health and Ageing to make determinations of a person’s
eligibility for concessional or assisted resident status after the value
of their assets has been determined.
Items 24 to 26 of Schedule 2 allow the Secretary to delegate to
the CEO of Centrelink or to the Secretary of the Department of Veterans’
Affairs the power to perform the functions given in new section 44-8AA
and 44-8AB.
Endnotes
-
W.P. Hogan, Review of Pricing Arrangements in Residential Aged
Care: Final Report, 2004.
-
Department of Health and Ageing, 2003-04 Report on the
Operation of the Aged Care Act 1997, p. 5.
-
Ibid., p. 5.
-
Productivity Commission, Report on Government Services 2005
– Aged Care Services – p. 12.18.
-
Department of Health and Ageing, 2003-04 Report on the Operation
of the Aged Care Act 1997, p. 15.
-
Ibid., p. 15.
-
W.P. Hogan, Review of Pricing Arrangements in Residential Aged
Care: Final Report, 2004, p. 277.
-
Ibid., p. 288.
Greg McIntosh and Dale Daniels
16 March 2005
Bills Digest Service
Information and Research Services
This paper has been prepared to support the work of the Australian Parliament
using information available at the time of production. The views expressed
do not reflect an official position of the Information and Research Service,
nor do they constitute professional legal opinion.
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ISSN 1328-8091
© Commonwealth of Australia 2005
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Published by the Parliamentary Library, 2005.
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