Aged care user-pays push for ‘well-off’

Industry group says aged care residents should pay for their everyday expenses - including food and transport - if they can afford to.

Aged Care Minister Anika Wells. Picture: David Clark

Older Australians living in aged care should pay for their everyday expenses – including food, transport and accommodation costs – if they can afford to, in order to ensure the sector remains sustainable.

In a submission to a government taskforce looking into how to ensure adequate funding for aged care, the Aged Care Industry Association said well-off Australians should cover “a significant portion, if not all” of the costs of their care just as they would if they were living independently.

Some of these costs include food, utilities, laundry, transportation, personal care items, and household and garden maintenance, as well as accommodation costs such as rent or mortgage payments.

The peak body – which represents 30 direct members including major ASX-listed companies and also consults with more than 500 facilities across Australia – said the federal government must be accountable for the money it spends on aged care.

“To meet the growing demand in the aged-care sector, it’s ­imperative that the contributions from government and consumers are not just sufficient to cover costs but also include room for aged-care providers to achieve the profits that build ­investor confidence in the sector, that underpins growth and ­redevelopment of what is aged building stock,” the submission reads.

“Without adequate revenue, aged-care providers face challenges in maintaining, let alone enhancing, the quality of care they provide.

“Insufficient funds can force compromises in care quality, staff shortages, outdated equipment, and facilities that do not meet the needs or expectations of an ageing population.”

The federal government is looking into how it can find the right policy settings to ensure the sector remains viable, with Australia’s population projected to age rapidly over the next four decades.

Government spending on aged care has also ballooned, including an additional $11.3bn over four years in the May budget to cover a 15 per cent wage increase for more than 250,000 nursing and care staff.

Aged care is the fourth-largest payment program for the ­federal government, according to the budget, at $32bn in 2023-24, rising to almost $40bn by 2026-27.

The Australian in February revealed calls from Catholic Health Australia, Council on the Ageing, Aged & Community Care Providers Association and leading aged-care financial analyst StewartBrown for Labor to raise the means-testing threshold for housing wealth in a bid to underwrite the financial viability of the sector.

Government figures in June found that 70 per cent of aged-care homes were operating at a loss.

Aged Care Minister Anika Wells told The Australian the government was “committed to an aged-care system that is fair and equitable both for older people who contribute to the cost of their care and for working people who support aged care through their taxes”.

Ms Wells said the government would consider all options from the Aged Care Taskforce when it reports by December.

“The government is the majority funder of aged care, paying an estimated $30bn in 2022-23. This is expected to increase to $36bn in 2023-24,” the minister said.

“The royal commission’s great unanswered question remains – how to make aged care equitable and sustainable into the future.”

Opposition health spokeswoman Anne Ruston said the Coalition would work constructively with the government to ensure the future sustainability of the aged-care sector.

“We will consider any sensible policy solutions put forward by the Aged Care Taskforce and the government in good faith,” Senator Ruston said.

“Ensuring the sustainability of Australia’s aged-care sector is absolutely critical to ensuring future generations have access to the care they need and the care they deserve as they age.”