KEY POINTS
- The government has announced major reforms to aged care after reaching a deal with the Coalition.
- Australians who choose to age at home will have access to greater support through a new system, Support at Home.
- Under the reforms, new entrants to residential care would be required to make larger means-tested contributions.
The federal government has announced a suite of aged care reforms, including more support for up to 1.4 million older Australians who choose to stay in their own homes.
Prime Minister Anthony Albanese announced the $5.6 billion package on Thursday after reaching a deal with the Coalition.
The government said the reforms, which have bipartisan support, would represent the "greatest improvement to aged care in 30 years".
"This is about caring for the generation that cared for us," Albanese told reporters in Canberra on Thursday.
The package also includes "essential" changes to residential aged care, including requirements for new entrants to make larger means-tested contributions.
At-home care
Among the major changes is $4.3 billion towards a home care package called Support at Home, which would come into effect on 1 July next year.
According to government figures, the number of Australians in home care has increased fourfold in the past decade.
"We've heard the message from older Australians: they want support to stay in the homes and communities they love," Aged Care Minister Anika Wells said.
"Support at Home will help around 1.4 million older Australians do just that, with shorter wait times, more levels of support, and funding for home modifications."
The government says the new system would provide support for clinical care, such as nursing or occupational therapy, along with everyday living, such as cleaning or meal preparation, showering, getting dressed or taking medications (classified as independence costs).
Aged Care Minister Anika Wells said the reforms will help older Australians stay in their homes. Source: AAP / Mick Tsikas
How much a person pays would be based on their income and assets.
Full pensioners would contribute 17.5 per cent of everyday costs and five per cent of those supporting their independence, while the percentages for self-funded retirees would be 80 and 50 per cent.
A lifetime cap would mean no one would contribute more than $130,000 to their non-clinical care, with every Support at Home contribution counted towards that cap.
Participants would also be eligible for up to $25,000 in additional support to spend their final three months of palliative care at home, rather than at a hospital.
According to a 2018 report from the Productivity Commission into end-of-life care, up to 70 per cent of Australians would prefer to die at home, but most will be in hospital.
Changes to residential aged care
The government has announced several "essential" changes to residential care to improve funding, viability and quality of the sector.
, published in March, found the sector would need $56 billion in funding to update existing facilities and build new rooms to meet growing demand.
It recommended Australians make a reasonable means-tested contribution to the cost of their care.
Under the reforms, new residents from 1 July next year would need to make larger means-tested contributions, based on their income and assets.
The maximum accommodation price for a room would be increased from $550,000 to $750,000, and indexed over time.
Providers will be able to retain two per cent of refundable accommodation deposits per year, for up to five years.
The treatment of the family home will be unchanged.
The government says the new arrangement will result in around half of new residents paying more for their residential aged care.
It will provide a 'no-worse-off' principle for people already in aged care facilities. Everyone in residential care on 30 June 2025 will maintain their current arrangements until they leave care.
New laws
New laws will soon be introduced to parliament to protect the rights of Australians living in aged care and ensure providers are held accountable.
The new Aged Care Act legislation would include stronger regulatory powers "to protect people from harm", a regulator with stronger investigative powers, and a new independent statutory complaints commissioner.
The legislation would also introduce a compensation pathway for older Australians whose rights had been breached, along with new whistleblower protections.
Under the reforms, the annual growth of government spending for aged care is expected to moderate from 5.7 per cent to 5.2 per cent.
For every $1 contributed per person in aged care, the federal government will chip in $3.30 on average to residential care and $7.80 for Support at Home.
"These reforms are all about delivering better care for more people in a more sustainable way," Treasurer Jim Chalmers said.
"It's a step change in care, and a structural reform to the Budget."
Under the reforms, the government would spend $930 million over four years, and save $12.6 billion over the next 11 years.
With additional reporting by the Australian Associated Press.
