The aged care sector is (again) on the brink of a historic change with the Aged Care Bill 2024 looking set to pass Parliament within the next few days – but question marks remain over several of the reforms contained within the new Act.  

The Bill is now set to be voted on in the Senate before heading to the House of Representatives for the final vote – just a week before Parliament wraps up on Thursday, 28 November. 

The Shadow Minister for Health and Aged Care, Senator Anne Ruston has outlined several reforms the Coalition thinks require further scrutiny, but here are our big five: 

Will the 10% cap on care management stay? 

The decision to cap care management fee to 10% of a client’s overall package has come in for considerable criticism – and with good reason. 

Care management revenue is forecast to drop considerably under the measure, which will in turn hit providers’ margins – operators say the cap should stay at the current 20%. 

The Coalition has indicated they want the Government to “undertake further consultation on care management fee caps, including with clinicians, to provide greater transparency about the factors that were used to determine the Service Lists”.  

So, there is hope but much will hang on the new pricing for home care services which is due to be revealed in February next year. 

What about (the lack of) consumer contributions for home care? 

StewartBrown had predicted that the introduction of consumer contributions would bring an additional $1 billion to home care. 

But the legislation has revealed that the consumer contributions will be deducted from the subsidy paid to providers. 

This means there will be no new money into the system – hardly the intention of the Aged Care Taskforce.  

With home care already facing unsustainable returns, this is a dangerous path for the Government to take. 

Will the reforms encourage operators to build? 

With 40,000 aged care beds forecast to be needed in the next five years, the new legislation does nothing to drive future investment in the sector in the short-term. 

The Government has committed $300 million for building new aged care homes in thin markets, but it appears additional funding will be required to support operators during the transition and get the sector building and refurbishing beds. 

Labor has also accepted the Taskforce’s recommendation for a review of the Accommodation Supplement, but this will need to happen sooner rather than later to ensure providers are incentivised to keep taking supported residents. 

Will there be any leeway on workforce requirements? 

With the shortage of Registered Nurses still the biggest pain point for operators, the issue of mandated care minutes and 24/7 RNs remains problematic. 

The Opposition has flagged it wants more flexibility for regional aged care homes to meet nursing requirements. 

Can the sector make the 1 July 2025 timeline? 

The Aged and Community Care Providers Association (ACCPA) has been calling for a six to 12-month transition period to the new reforms. 

Check out the Department’s recently updated 2025 roadmap above.

Given the sheer number and scale of the reforms coming through next year, a phased implementation period seems a safe bet.

The passage of the Bill represents an important step forward for the sector – but there is more work to be done.