Aged Care Reforms Overview May 2014
If you do not change direction, you may end up where you are
heading
Caring for Older Australians
Reducing red tape
Quality care for consumers
What Reforms?
Changes to legislation Home Care Packages Programme New supplements MyAgedCare and call centre Australian Aged Care Quality Agency Aged Care Pricing Commissioner
Achievements
2015Increased functionality – MyAgedCare
Commonwealth Home Support
CDC for all Home Care Packages
2014Accommodation prices published on MyAgedCare
Changes to fees and subsidies
Removal of high/low
Reforms going forward
Only permanent residential aged care
This distinction currently affects:• conditions of allocation for residential aged
care places;• care approvals;• resident classifications; and• residential aged care accommodation
payment arrangements.
High Care and Low Care
1 July 2014 NO high care and NO low care places – all just residential care places
Next ACAR NO high care NO low care place allocation
Conditions of allocation
• No distinction between high and low approvals
• Approvals will not lapse
Care approvals
ACFI
How do we classify residents?
Check your resident agreements
Remove ‘low care’ and ‘high care’ references
Ageing in place
No Change to Residential Respite
Proposed modernisation of items
Classifications that can be charged a fee for Part 3
Additional care and services
Schedule of Specified Care and Services
My aged care website
My Aged CareFor information about aged care services, and how to access them:• Visit the My Aged Care website at www.myagedcare.gov.au or• Call 1800 200 422*Call My Aged Care operators to discuss your needs from:• Monday to Friday – 8am to 8pm (local time)• Saturday 10am to 2pm (local time).The call centre is closed on public holidays.If you are deaf or have a hearing or speech impairment, we can help through the National Relay Service. Call 1800 555 667* and ask for 1800 200 422*,If you need an interpreter, we can help through the Translating and Interpreting Service. Call 131 450 and ask for 1800 200 422*.*1800 calls are free from fixed lines; however,calls from mobiles may be charged.
Ongoing updates are available at:
My Aged Care websitewww.myagedcare.gov.au
Department of Social Services website:www.dss.gov.au/agedcarereform
More information….
Aged Care Reforms – Home CareMay 2014
1 July 2014Income testing for home care
1 July 2015All Home Care Packages convert to CDC
Key Milestones
Consumers can continue to be asked to pay a basic fee
Some consumers can be asked to pay an income-tested care fee
The amount of subsidy paid is reduced by the consumer’s income tested fee
DHS will administer the income assessment
There will be a fee estimator on My Aged Care
Income testing in Home Care
84% equates to approx $1.2 billion and 16% equates to approx $0.2 billion, based on 2013/14 data.
Home care – Government subsidy Vs. Client contributions
Home Care income thresholds and capsSingle person, March 2014 prices (current rates)
Grandparenting arrangements
Caps on the amount of income tested feesFull pensioners will not pay any income
tested feesPart pensioners pay up to $5000Self Funded Retiree’s pay up to $10,000
Financial Hardship Assistance
Home Care – Safeguards
Worked examples
March 2014 prices
Home Care
Total assessable income: $14,500 p.a.A care recipient who is a member of a couple is taken to have half of the couple’s combined assessable income ($29,000 / 2)
Income free area*: $19,172.40(*partnered person rate)
Total assessable income is less than the income free area, therefore:
Rose cannot be asked to pay an income tested care fee.
Income test
Income tested care fee$0.
The Government will meet the full cost of Rose’s care.
Basic daily fee$3,483 per year or
$9.57 per day
Note:Rose’s provider can charge her the basic daily fee. This is calculated at 17.5% of the basic age pension.
+
Worked example 1 - Rose
Total assessable income: $65,000 p.a.
Income free area: $24,731.20
Total assessable income > income free area:
Joseph can be asked to pay an income tested care fee.
Joseph’s package costs: $37.38 per day
Income tested care fee
Joseph’s income tested care fee will be the lower of:
• $27.47 per day (being the daily calculation of the $10,000 annual cap) or
• His care costs ($37.38);
Joseph can be asked to pay a maximum of $27.47 per day.
Basic fee$3,483 per year
+
Joseph’s income is above the upper cap threshold of $57,882 so $10,000 cap applies.
Worked example 2 - Joseph
• My Aged Care website (www.myagedcare.gov.au or 1800 200 422*
• Ongoing updates available at the Department’s website
(http://www.dss.gov.au/agedcarereform)
• Email questions to [email protected]
• * 1800 calls are free from fixed lines; however, calls from mobiles may be charged.
For more information
Aged Care Reforms – Residential CareMay 2014
• Key Milestones
• Overview of new fee arrangements
• New means testing arrangements
• Accommodation Payments
• Safeguards for Residents
• Examples of the new fee arrangements
Overview
19 May 2014• Publication of accommodation prices began
1 July 2014• New means testing arrangements• Accommodation payments• Higher accommodation supplements • Removal of high/low care distinction
There are grandfathering provisions for existing residents.
Key Milestones
• Basic Fee
• Means Tested Care Fee
• Accommodation
• Extra Services Fee
• Additional Services Fee
Residential Care Fees from 1 July 2014
• Income and assets combined test conducted by DHS
• Determines the fees and therefore the Commonwealth Subsidy paid for each resident
• Fee estimator available from 1 July 2014
Means Testing in Residential Care
Grandparenting arrangements
Annual and lifetime capsAnnual cap of $25,000Lifetime cap of $60,000
Safeguards on the family home
Financial Hardship Assistance
Safeguards for Residents
Subsidies and Fees from 1 July 2014
Lower Means
Higher MeansModerate MeansPays basic daily fee
Pays Accommodation Payment (no supplement)
Pays Means Tested Care Fee – care is partially subsidised
Pays Basic daily fee
Pays Accommodation Contribution(receives some Accommodation Supplement)
Does not pay Means Tested Care Fee – care is fully subsidised
Pays basic daily fee only
Receives full Accommodation Supplement
Does not pay Means Tested Care Fee – care is fully subsidised
New Residents from 1 July 2014$154,179
$45,000
$24,731 $62,944
• Choice of Payment Method• Refundable Accommodation Deposit
or • Daily Accommodation Payment • Combination of Both
• Fairer Assessment of Capacity to Pay.
Accommodation Costs – What’s New?
• Consumer Protection and Safeguards• Accommodation Price cannot be more than the
price published• Prices over $550,000 must be approved by Aged
Care Pricing Commissioner
• Increased Price Transparency• Prices must be published on MyAgedCare,
provider websites and relevant printed materials
Accommodation prices– What’s New?
Residential Care Examples
Jenny
Paying for accommodationJenny has income less than $24,731, assets less
than $45,000
Amelia
Paying for AccommodationAmelia with income of $21,913 and assets of $120,000
Peter
Government Accommodation vs Client Contribution for Accommodation Costs
Peter with income of $65,000, assets of $1,344,500
Means Tested
Amount
=$167.21Total assessable assets: $1,344,500
Asset free area: $45,000Working out the asset tested amount:17.5% x ($154,179 – $45,000)+1% x ($372,537– $154,179)+2% x ($1,344,500 – $372,538)
= $40,729.16 / 364
Asset tested amount = $111.89
Total assessable income: $65,000
Income free area: $24,731.20 Therefore:
= 50% × ($65,000 - $24,731.20) / 364
= $55.31
Income tested amount = $55.31
Peter
Accommodation costs
Peter will pay his own accommodation costs because his means tested amount is greater than $52.49
Means tested care fee
Peter pays a means tested care fee of $114.72 up to $25,000 p.a
$167.21 - $52.49 = $114.72
Basic daily fee
$46.50 per day
+
+
Peter
• My Aged Care website (www.myagedcare.gov.au or 1800 200
422*
• Ongoing updates available at the Department’s website
(http://www.dss.gov.au/agedcarereform).
• Transitional Business Advisory Service on 1800 122 092 or by
visiting the website at www.kpmg.com/AU/en/industry/Aged-
Care/tbas/
• * 1800 calls are free from fixed lines; however, calls from mobiles may be charged.
For more information:
For information about aged care services, and how to access them:• Visit the My Aged Care website at www.myagedcare.gov.au or• Call 1800 200 422*Call My Aged Care operators to discuss your needs from:• Monday to Friday – 8am to 8pm (local time)• Saturday 10am to 2pm (local time).The call centre is closed on publish holidays.If you are deaf or have a hearing or speech impairment, we can help through the National Relay Service. Call 1800 555 667* and ask for 1800 200 422*,If you need an interpreter, we can help through the Translating and Interpreting Service. Call 131 450 and ask for 1800 200 422*.*1800 calls are free from fixed lines; however,
calls from mobiles may be charged.
My Aged Care
Top Related