Catholic Health Australia CEO Pat Garcia and Bupa Asia-Pacific Chief Executive Hisham El-Ansary have publicly backed DCM Group’s Plan B over the holiday period – stating that residents who can afford it should pay more for aged care.
Pat, in a column for the Financial Review, wrote that the Government draws a “relatively minor distinction” between those who cannot afford to pay for their accommodation and those who can.
“About 75% of aged care funding comes from the government, and has been growing. Between 2016 and 2020, government funding increased by $2 billion – or 17% – but users paid only $400 million more, an increase of just 8%,” he wrote.
“The reason for this trend is primarily the structure of means testing. For most older Australians, the bulk of their wealth is tied up in the value of their primary residence. But when that older Australian is means tested for personal and nursing care services, the government considers their housing wealth only up to the value of $200,000.
“Given the median value of an Australian home today is about $1 million, that means the government is turning a blind eye to a staggering amount of money.”
Hisham told The Australian he believes if a wealthier resident could fund a greater share of their care, they should be able to, adding that if federal government made such a change, it would boost the financial sustainability of the sector.
“Right now, two thirds of the sector is losing money and whether you’re a profit or a Not For Profit, you can’t have a situation where your expenditures are greater than your revenues,” he said.
“The question we’ve got to ask ourselves is, is that reasonable for those who are selling multimillion-dollar homes, for example, and the maximum they can contribute towards their care is $73,000 in their lifetime.”
DCM Group’s Plan B believes allowing older people with the means to contribute more to the cost of their accommodation and everyday living expenses as the sensible alternative to increasing the tax burden on all Australians to pay for aged care.
