Under the new AN-ACC funding model, aged care homes in metropolitan cities are in the same Modified Monash Model (MMM) funding bracket as homes in rural towns, although costs are higher in country areas.
The MMM is used by the Department of Health and Aged Care to allocate additional funding in recognition of the additional costs of obtaining goods and services due to their location.
Chris Mamarelis, CEO of Not For Profit provider Whiddon, which has 19 aged care homes across NSW and South Queensland, said, “A home in Moree is considered to have no lesser cost pressures to a home in Mosman, an affluent suburb on the Lower North Shore region of Sydney, which as an operator of homes across regional and remote NSW, defies logic.”
Recruiting, freight, trades, materials and travel all cost more in rural areas. Housing is also an issue.
“Recruitment alone brings with it the additional pressure of supporting relocation costs, temporary accommodation and incentives to attract skilled people to the regions,” said Chris.
Frank Price, CEO of Royal Freemasons’ Benevolent Institution, owns and operates four retirement villages – Basin View, Glen Innes, Leeton and West Wyalong – in MMM4.
“These villages, simply because of their location, prove to be more difficult to manage as staffing, agency labour in these areas is problematic and much more expensive, available housing is practically non-existent and costs for supplies is usually much higher,” he said.
A spokesperson for the Department of Health and Aged Care told The SOURCE, “AN-ACC provides additional fixed funding for services located in rural (MMM5), remote (MMM6), and very remote (MMM7) locations, to reflect the additional costs of delivering care in these locations. This is based on evidence from the Resource Utilisation and Classification Study conducted in 2017-18 by the University of Wollongong.
“This study also found that the costs of delivering care in MMM 1-4 locations were very similar, hence there is no difference in the amount of fixed funding that services in these areas receive.”
However, the spokesperson said AN-ACC is not a ‘set and forget’ model. When the Independent Health and Aged Care Pricing Authority (IHACPA) starts to provide annual AN-ACC price recommendations based on the actual costs of delivering care from July 2023, this will include the costs of delivering services in different MMM locations.
