Self-funded retirees to pay more for aged-care services

Self-funded retirees will be asked to pay more out of their own savings for their aged care under a deal set to be struck between Labor and the Coalition that will chart a new course for the care of older Australians.

New aged-care laws are a step closer to being finalised in Canberra.

Self-funded retirees will be asked to pay more out of their own savings for their aged care under a deal set to be struck between Labor and the Coalition that will chart a new course for the care of older Australians.

The Australian understands legislation giving effect to the changes has been largely agreed between the parties and, barring last-minute politics, could be put to parliament as early as Thursday.

The new laws would see wealthier older Australians privately funding more of their daily living expenses while in aged care.

Those not drawing a government pension would pay more for nursing home rooms, meals and everyday living costs such as cleaning, while those ­receiving in-home care packages would contribute more of their own money for ­services such as home maintenance and ­gardening.

The new aged care bill is the Albanese government’s response to a number of elements of the aged care royal commission, and to its own taskforce that examined the financial sustainability of a beleaguered sector in which currently half of all nursing homes are operating at a loss.

It is expected to come into force from July next year but, under grandfathering arrangements, existing nursing home residents are understood to be exempt from the changes. For home care, the greater co-contributions are not expected to come into effect for a further two years to allow for a transition.

The sweeping legislative reforms would pave the way for the introduction of a new aged care Act making care a right for all older Australians.

Negotiations between Labor and the Coalition over the legislation have been taking place since early this year, with advocates and peak bodies urging it be prioritised as the sector struggles with low investment and a lagging stock currently not on track to keep up with future demand.

In a major concession to the Coalition, Health Minister Mark Butler last week wrote to opposition aged care spokeswoman, Anne Ruston advising that Labor would drop its proposal to include criminal penalties on nursing home directors who breach care rules and standards.

Health and Aged Care Minister Mark Butler. Picture: AAP

Opposition aged care spokesperson Anne Ruston. Picture: NewsWire / Martin Ollman

The plan to impose criminal penalties was one of Labor’s ­election promises and a key sticking point between the ­government and opposition, with aged care operators last month saying it would trigger an exodus of key personnel, including board directors who would be saddled with the extra regulatory risks despite many being volunteers.

Following the letter being sent to Senator Ruston, The Australian understands Labor on Tuesday provided the Coalition with the relevant excerpts of the proposed Act, confirming criminal penalties had been removed.

Senator Ruston said the opposition had “fought hard against the inclusion of criminal penalties in the new aged care Act”.

“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,” she said.

“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.

“The threat of jail time is the last thing aged care workers and volunteers need as they work hard to care for older Australians amongst significant challenges.”

While Labor was hopeful the concession would see the Coalition give its long-awaited support for the government’s legislation, Senator Ruston on Tuesday night said the Coalition still had not finalised its position.

Instead, she again called on the government to first table the entire bill for the Coalition to see.

“The Coalition is not stopping the government from putting the bill into the parliament, and we have been publicly encouraging them to do so,” she said. “We believe older Australians and their families also need to be brought along (on) this journey of reform.”

The Australian understands Labor is hesitant to table the bill without the Coalition first guaranteeing its support out of concern the opposition would seek to politicise parliamentary debate.

Providers and advocates for older Australians have been pressing for the changes to be pushed through parliament, saying more funds need to flow into the sector to improve the standard of care.

Provider advocate the Aged and Community Care Providers Association said further delays would see more residential care and home care providers go to the wall, and exacerbate a lack of confidence to invest in new stock or businesses.

“We’re building a fraction of the beds we need each year ­because the investment climate is not there,” association CEO Tom Symondson said.

“At the moment there are more ‘no vacancy’ signs in residential care at a time more people are needing a bed.”

But acting Inspector-General of Aged Care Ian Yates has urged the government to enshrine in the new laws a “universal entitlement” to aged care, similar to Medicare.

Mr Yates said the government’s planned approach in the exposure draft of the legislation would see the current rationed approach to care continue, which is leaving tens of thousands of older Australians sitting on waiting lists for home care packages already approved.