Alarm bells ringing over aged-care reforms

The aged-care sector is headed for ‘catastrophe’ unless Labor delays its milestone reforms by at least six months, peak bodies and providers across the sector say.

Population data has revealed a 9.13 per cent increase in the number of Australians aged 75 and over. Picture: Kari Bourne / Sunshine Coast Daily

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The aged-care sector says it is headed for “catastrophe” unless Labor delays its milestone reforms by at least six months, with the government facing pleas from the industry to stagger the rollout of the Aged Care Act and its associated changes ahead of an election campaign where Labor plans to spruik its credentials in the “care economy”.

While the government’s $5.6bn reforms are due to be implemented in 100 days, peak bodies and providers across the sector say “nothing is ready” and have raised alarm that some operators could face insolvency.

The elderly may also need to pay more in the short term because of uncertainty around Labor’s policies.

The Retirement Living Council said operators were overwhelmed by the introduction of new liquidity standards, need to train staff for the transition and still have to overhaul their information and technology systems.

“As things stand, there is too much important work to be done, and not enough time for it to be completed,” RLC executive director Daniel Gannon said.

“A lot of the recent pressure clearly relates to an unrealistic July 1, 2025, commencement date for the new aged-care system, begging the question about why this timeframe isn’t delayed.”

The sector’s nervousness has intensified over recent weeks, with new Australian Bureau of Statistics’ population data revealing a 9.13 per cent increase in the number of Australians aged 75 and over, a figure that equates to an extra 181,339 people in this age cohort than last year.

“This demographic silver tsunami should dictate more rigour in policy setting,” Mr Gannon said.

“This isn’t about getting something from government, it’s about continuing to provide care and support services subject to reasonable timeframes.

“There wouldn’t be many care operators, if any, who are confident they can deliver the new system as the timeframes currently stand.”

Retire Australia chief operations officer Simon Fawssett said there was a real risk the system would not be set up properly by July 1 to allow “funds to flow through”.

“Where the catastrophe … is going to happen because of the speed is the fact that operators probably won’t have the systems and processes and finances ready to make the change,” he said.

“You’ve got 200,000 elderly people on Home Care Packages today and there’s 80,000 people on the waiting list … If everything isn’t really, really well organised and the elderly people know what they’re paying for, then come July 1 the risk is that funds don’t flow through the system to pay for services, elderly people will not get the care they need, staff won’t get paid (and) operators won’t be able to stay solvent.:

He said IT organisations engaged by aged-care operators were still waiting on necessary information from the government to build the new systems, while major consulting firms were unable to provide providers with any guidance because “they themselves still have a lot of questions”.

Aged Care Minister Anika Wells at home in Wavell Heights, Brisbane. Picture: Lyndon Mechielsen/Courier Mail

A spokesman for Aged Care Minister Anika Wells said the ­Albanese government made “no apology for holding aged-care providers to account for the billions of dollars they receive from older people and taxpayers”.

“To support the implementation of these reforms, the Transition Taskforce was set up to troubleshoot issues raised about the transition to the new Aged Care Act by 1 July, 2025,” the spokesman said.

“In addition to the Transition Taskforce, the government is also investing $20m to support in-home aged-care providers to transition to the new Aged Care Act and support at home program, with $10,000 ICT grants.”

Ageing Australia, which sits on the aged-care Transition Taskforce, said it had been urging the government for months to delay the reforms.

“Since the new Aged Care Act passed last year, we have been calling for realistic timeframes and a staged approach to implementing reforms of such magnitude. We have raised this in multiple forums, including the Transition Taskforce,” Ageing Australia chief executive Tom ­Symondson said.

“Aged-care providers face significant challenges enacting these sweeping reforms within timeframes which border on the impossible, while fulfilling their No 1 priority, improving the lives of older Australians.

“Providers need to replace entire systems at enormous costs, but much of this work cannot be completed as we don’t yet have the final specifications.”