Horrific stories from the families of residents in aged care have surfaced in the media again and once more we are deeply shocked, angry and distressed that our elderly nursing home residents can be treated so appallingly.
Even more disturbing is that we know the situations highlighted by the media are not uncommon. We know, over many years of contact and feedback from concerned ANMF members who work in the hundreds of residential aged care facilities across the country that residents do not receive the level of personal and nursing care they require. And we know this is inexcusable.
All the reports, reviews and inquiries into the aged care system over the past 20 years, (and there are literally hundreds), have done nothing to address the quality of care and improve the life of residents. Our members tell us the situation just gets worse and worse as the budget bottom line takes priority over anything else. Cost cutting by aged care providers directly impacts on resident care. In particular the number and mix of nursing and care staff on each shift is central to the provision of care and is generally the first area to be targeted. Cost cutting in other areas such as food, laundry and cleaning also impacts on the quality of life for residents.
Understanding the various components of government funding for residential aged care services is beyond the comprehension of most of us. And even more challenging is the question of whether we can ever know if the funding is ending up in the right place. Can we be confident that aged care providers are delivering the standard of care and service to the residents they are funded for?
Funding residential aged care is a big ticket item in the Federal government’s budget. It is the principal funder of residential care providing $11.5 billion in the 2015-16 financial year. The main source of funding for providers is the Aged Care Funding Instrument (ACFI) which provides funding for the personal and nursing care of each resident based on an assessment of their relative needs.
Federal government concerns about an unexpected blow out in ACFI funding claims triggered the latest round of budget cuts of $1.2 billion. This included making changes to ACFI via the scoring requirements in the complex healthcare domain together with a series of indexation pauses and partial indexation pauses up to the 2018-19 financial year.
Aged care residents, nursing and personal care staff are already bearing the brunt of these cuts with two major aged care providers in Queensland sacking staff and reducing nursing hours across all shifts. Blue Care has sacked 11 enrolled nurses across its Bundaberg facilities and slashed 1,540 nursing and care hours. While Southern Cross Care is cutting over 2,000 nursing hours across its facilities.
At the time of writing, of the 300 aged care members who completed an online survey on staffing and other changes in their facility, 94% reported reduced staffing levels and less care hours per resident. 89% stated that their current staffing levels were not adequate to provide even basic care, including bathing and bed changes.
Our aged care residents deserve much more than this. They are entitled to decent safe care and a reasonable quality of life in the latter part of their years. The ANMF is campaigning for mandatory minimum staffing and skill mix requirements as part of the solution to provide some certainty and safety for residents and staff.
Changes to funding and budget cuts are a constant in the aged care sector. Understanding the implications of any change in this area is extremely difficult. Government funding makes up the highest proportion of revenue for aged care providers with ACFI subsidies accounting for roughly 90% of that revenue.
Determining the impact of any change or cut on facilities is also complicated as the sector is made up of different types of providers, for example, for-profit operators and not for profit providers including religious and charitable. The size of the facilities, the care needs of the residents and location of the facility are also factors to take into account. All these factors contribute to the wide range of financial performance across the sector.
ANMF’s commissioned research* into the financial viability of providers following the latest budget measure shows, on average, an overall drop in revenue in 2017-18 through to mid-2019 but the impact varies enormously across the sector.
Operators sitting in the top 25% of financial performers will continue, on average, to maintain net earnings per resident at between $16,500 to $18,870 per year. In contrast, those sitting in the bottom 25% of financial results who are already operating in negative territory are projected to be in a far worse situation by 2020.
Our research also shows that for profit providers are impacted more by the budget cuts because, on average, they have a greater proportion of residents with higher care needs.
Government revenue per resident per year will decrease slightly in 2017-18 but increase again in each year between 2018-19 and 2020-21. The modelling shows the impact of the cuts on the for-profit providers taking effect in the 2017/18 and 2018-19 financial years. However the impact is relatively minor and net earnings per resident per year continue at a healthy $6,206 in 2017-18, bottoming to $4,961 in 2018/19 then rising again over the next two years to $6,404 by 2020-21.
Bottom lines and financial performance are one part of the picture, but it’s the residents and staff who tell the real story about what is happening in aged care and they are the ones that should be listened to.
*Report on the financial impact of the 2016-17 Federal Budget on residential aged care providers, UCoDA July 2017
Federal Research Industrial Officer