Improving aged care

Alex Grove, Social Policy

Key issue
The Royal Commission into Aged Care Quality and Safety has highlighted instances of poor care in Australia’s aged care system. The 46th Parliament may consider reforms to aged care regulation, funding and staffing, to ensure all older Australians receive high quality care when they need it.

The quality of aged care services is very important to the people who receive them, and to their families. Clients of the entry-level Commonwealth Home Support Programme (CHSP) may receive small amounts of support services such as meals on wheels or modifications to make their home safer (p. 2). A client on a high level home care package may have aged care workers visiting their home on most days of the week. Older people in residential aged care (nursing homes) actually live in the place in which they receive round the clock care, which means the quality of that care is central to their quality of life.

The quality of aged care in Australia

While comprehensive data are lacking, surveys of aged care consumers suggest they are receiving reasonable quality care:

  • 98 per cent of aged care residents surveyed in 2017–18 said that, most or all of the time, they felt safe, staff treated them with respect, and staff met their healthcare needs
  • 84 per cent of residents liked the food most or all of the time
  • 81 per cent of residents agreed they could talk to staff if they were feeling sad or worried and
  • 89 per cent of older people receiving care in the home in 2015 were satisfied with the quality of assistance received (p. 14.21).

However, concerns about the quality of some services have increased in recent years, particularly concerns about residential care. Serious failures of care identified at the Oakden Older Persons Mental Health Service in Adelaide led the Australian Government to commission an independent review of aged care quality regulation known as the Carnell Paterson review. (The Oakden service was state-run but also received some Commonwealth Government funding.) The review examined why longstanding problems were not adequately detected by the national quality regulation system.

Formal complaints to the aged care complaints authority have increased, from 4,711 complaints in 2016–17 to 5,779 in 2017–18 (p. 20). This could reflect an increase in underlying problems or increased awareness of aged care issues and complaints mechanisms. Three quarters of complaints received in 2017–18 were about residential care, with the most common problem raised being medication issues, followed by personal hygiene, and then staffing numbers. The most common issue raised in both home support and home care complaints was fees and charges, followed by lack of consultation and communication.

In 2017–18, the Department of Health also warned or sanctioned more providers for poor care than in the previous year. It imposed sanctions on 21 aged care providers for failing to meet quality standards. It also issued 166 notices of non-compliance, with 92 per cent of these due to a failure to meet quality standards.

In September 2018, the day before Four Corners screened a program investigating failings in aged care, the Government announced a Royal Commission into Aged Care Quality and Safety.

The Royal Commission continues to hear evidence of care failures. In response to the Commission’s survey, residential care providers have so far reported over 112,000 incidents of substandard clinical care in the last five years, particularly in regards to medication management, personal care and nutrition. Residents have also given evidence of poor care and mistreatment by some providers.

Issues for the Parliament

Because the Australian Government is the primary funder and regulator of the aged care system, it has many avenues to influence the quality of aged care. With the Royal Commission due to hand down an interim report in 2019 and a final report in 2020, the 46th Parliament may be called on to consider action on quality regulation, aged care funding and workforce issues to ensure that older Australians receive consistently high quality services.

Quality regulation

Aged care quality featured prominently in the 45th Parliament. Both the Standing Committee on Health, Aged Care and Sport and the Senate Community Affairs References Committee inquired into aspects of aged care quality. The former made wide ranging recommendations regarding aged care funding, staffing, quality regulation and information provided to consumers, some of which have already been implemented. The latter made recommendations relating to the regulation of clinical care in aged care, staffing and duty of care.

The Carnell Paterson review’s key recommendation was the establishment of a new Aged Care Quality and Safety Commission (the Commission). The Government agreed to this recommendation and the Parliament passed the enabling legislation in November 2018. The Commission came into being on 1 January 2019, combining the quality assessment of services and complaints functions of two previous entities. The Department of Health currently retains responsibility for approving aged care providers and ensuring they comply with their responsibilities (p. 78). These functions are scheduled to transfer to the Commission on 1 January 2020, subject to the passage of further legislation.

The 45th Parliament also passed legislation enabling a single, more consumer-focused set of quality standards. From 1 July 2019, the Commission will assess all Australian Government-funded aged care providers (that is, most providers) against these new Aged Care Quality Standards. The new standards reportedly allow for more flexibility to meet individual client needs, but their less prescriptive nature may present new challenges for providers such as understanding what evidence will now be required.

Further changes have been flagged. The Government announced in the 2019–20 Budget, a number of measures to improve service quality and safety. Some measures, such as establishing a real-time information sharing system in the Commission, can be done administratively. Others, such as restricting the use of physical and chemical (medication) restraints, have already been enacted through delegated legislation. Still others, such as requiring providers to report a wider range of serious incidents (such as assaults), would require amendment of the Aged Care Act 1997 (the Act).

The Government can also regulate the collection and publication of information on service quality. Site audit reports and Consumer Experience Reports for individual residential services are published on the Commission’s website. From 1 July 2019, nursing homes will be required to report data on three quality indicators (unplanned weight loss, use of physical restraint and pressure injuries). Consumers would reportedly like a wider range of quality information, such as consumer ratings and reviews and quality of life measures, to be available when they are choosing between services (pp. 6–7).


Aged care beds are not designed to provide the same intensity of care as hospital beds, nor are they funded to the same level. Residential aged care providers spent $254.29 per resident per day in 2016–17 (p.101). This does not include services such as GP visits and medicines, which are funded through other parts of the health system. In contrast, a sub-acute bed in a hospital cost an average of $1,070 per day in 2015–16 (p.  35), although this includes a wider range of healthcare costs (such as doctors’ salaries and medicines).

As noted above, residential aged care is largely funded by the Australian Government (68.3 per cent of operational funding) and contributions from residents (26.2 per cent) (p. 97). Capital financing mostly comes from lump sum payments by residents (which act as interest free loans), but also from Australian Government grants and other sources (pp. 112–113, 116).

Under the current Aged Care Funding Instrument (ACFI), Australian Government care funding increases as the resident’s needs increase, but only up to a specified maximum level. The trend over the last decade has been for people to enter residential aged care at a later age, and with higher care needs than in the past. The Department of Health has been working on alternative approaches to residential aged care funding (to replace the ACFI), and the 46th Parliament may be asked to consider a new funding model that more accurately reflects the costs of providing care.

Even under the current model, aged care funding is forecast to increase by 11.2 per cent in real terms from 2019–20 to 2022–23. This reflects an ageing population, as well as other factors such as an increase in the number of home care packages made available. If the Government wishes to improve the quality of aged care, it may need to consider further increases in funding (above those required by growth in the older population). For example, the Morrison Government has already given extra funding to providers to transition to the new quality standards. Other proposed regulatory changes, such as mandating minimum ratios of staff to residents, could increase provider costs and require extra government funding. Increased regulation may also require staff to spend more time on paperwork, at the expense of patient care.

Increased quality could also be facilitated by consumers paying more for their own care. Many older Australians have accumulated significant wealth by the time they need to access aged care. The Legislated Review of Aged Care 2017 recommended including the full value of the family home in the means test for residential care and removing annual and lifetime caps on means-tested care fees (p.  9), but this was ruled out by the Turnbull Government. Any move in the 46th Parliament towards consumers with means paying more for their care would need to be carefully considered.


Aged care is a labour intensive industry. The average home care recipient receives around five hours of direct care per week (p. 33), while the average aged care resident receives over three hours of direct care per day (p. 15). Wages and salaries account for 57 per cent of provider costs in home care (p. 23) and 68 per cent in residential care (p. 38). The quality of care may be influenced by the availability of staff to provide care, their skills and qualifications, and the extent to which vocational training matches current and future skill requirements (such as providing dementia care). These in turn can be influenced by funding (discussed above) and regulation.

Aged care providers are required to ‘maintain an adequate number of appropriately skilled staff to ensure that the care needs of care recipients are met’ (paragraph 54-1(1)(b) of the Act). However, the Act does not specify a minimum ratio of staff to residents, nor does it prescribe the mix of qualifications to be held by care staff. Personal care attendants make up 70 per cent of direct care staff in residential care (p. 13) and community care workers make up 84 per cent of direct care staff in home care and home support (p. 70). There is no minimum qualification requirement for these staff, although in practice the majority have certificate level qualifications in aged care (pp. 21, 79).

The 45th Parliament saw attempts to regulate aged care staffing. Senator Hinch introduced a private senators’ bill to mandate a minimum staff to care recipient ratio in residential care. Ms Sharkie introduced a private members’ bill to require residential care providers to notify the Department of Health of the ratio of staff members to care recipients. Neither bill passed, although the House Standing Committee on Health, Aged Care and Sport did recommend that Ms Sharkie’s bill be passed.

The Aged Care Workforce Strategy recommends an industry code of practice, changes to vocational training and accreditation, standardised workforce planning, attraction and retention strategies, a revised workforce relations framework, an accord for remote providers, a research centre and further consideration of funding and staff remuneration (pp. 14–17). Both the Coalition and Labor have expressed support for the Workforce Strategy.

The Coalition Government has:

Many reforms affecting aged care quality are already in train, and the Royal Commission looks set to recommend even more, making this a policy area which may feature prominently in the 46th Parliament.

Further reading

A Grove, Aged care: a quick guide, Research paper series, 2018–19, Parliamentary Library, Canberra, 2019.

Dr S Clark and C Petrie, Aged Care Quality and Safety Commission Bill 2018 [and] Aged Care Quality and Safety Commission (Consequential Amendments and Transitional Provisions) Bill 2018, Bills digest, 40, 2018–19, Parliamentary Library, Canberra, 2018.


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