Two steps forward and potentially one step back. Operators’ enthusiasm for delivering higher level care services in retirement villages received a shock over Christmas, particularly for private aged care operators.
On December 14, the Federal Government released its draft of the new Aged Care Act, which it is required to introduce by 30 June. There is excitement because for the first time retirement villages are acknowledged as a place where care services can be provided, meaning there is hope that Federal funds will flow into retirement villages, most probably as higher level Home Care Packages.
But then the draft of the Bill states that sections of the village will be regarded as a ‘residential aged care home’ if the village:
- is the place of residence of individuals who, by reason of sickness, have a continuing need for aged care services, including nursing services; and
- it is fitted, furnished and staffed for the purpose of providing those services.
See the edited extract above.
The challenge with being rated as a residential care home is that it brings in all the compliance avoided by contracting with the resident under the Retirement Villages Act.
This could dash the dreams of many operators and their boards who had concluded that residential aged care is just too hard and they strategise they will move heavily into retirement villages, providing care under Home Care Packages.
Private aged care operators like LDK Seniors' Living and Odyssey Lifestyle Care Communities will be particularly vulnerable.
The good news is the drafting of the new Act is far from complete and level heads need to see this challenge off.
The reality is that Australia desperately needs expanded care services and retirement villages as we slip further behind in the construction of new residential aged care beds, compared to demand.
Back of envelope is not impossible to think that as many as 100,000 village beds could be supporting high-level care within a couple of years, 50% of the 200,000 residential aged care beds now on the market. This is perhaps the only hope that the country will have enough beds for the Baby Boomers.
With aged care being federal legislation and villages being state legislation, there is a potential collision going to take place. Logic says the Federal Government will support the delivery of care and have regulation around that (think home care) but the accommodation component will be state-controlled and contracted with the consumer.
It’s a double-edged sword. The Federal Government can make cash flow into villages but it could be accompanied by severe regulation and compliance. The sector has urgent work to do to make its case.
