EXPLANATORY STATEMENT
AGED CARE ACT 1997
SUBSECTION 48-1(3)
Determination of the amount of Community Care Subsidy (ACA Ch. 3 No. 1/2007)
Subsection 48-1(3) of the Aged Care Act 1997 (the Act) provides that the amount of community care subsidy that is payable to an approved provider in respect of a day is the amount:
(a) determined by the Minister in writing; or
(b) worked out in accordance with a method determined by the Minister in writing.
In accordance with paragraph 48-1(3)(b) of the Act, the Determination of the amount of Community Care Subsidy under subsection 48-1(3) (ACA Ch. 3 No. 1/2007) (the Determination) specifies the method for working out the amount of community care subsidy payable under section 47-1 of the Act for a day in respect of a community care recipient.
The Determination applies from 1 January 2007 and, from that date, revokes the Determination made under section 48-1 (ACA Ch. 3 No. 9/2006), which was made on 28 June 2006.
This basic daily amount of community care subsidy that is payable in respect of a community care recipient is $33.30 and came into effect on 1 July 2006. This amount is specified in Step 2 of the Determination and has not been altered by the Determination.
Step 1 of the Determination provides for an additional daily amount of community care subsidy to be paid to an approved provider of community care who provides community care to a care recipient who resides in rural and remote locations, provided that location has an Accessibility / Remoteness Index of Australia (ARIA) score of 3.52 or more.
Under the ARIA, each suburb and town in Australia is allocated an ARIA score based on its accessibility and remoteness. ARIA scores for all Australian locations are contained in the document entitled Viability Funding — ARIA scores for locations as at 30 July 1999, published by the Commonwealth Department of Health and Ageing. The Department will verify the location of a care recipient by reference to the postcode of the suburb or town in which the care recipient resides.
The more remote the community care recipient’s residential location, the higher the ARIA score for that location and the higher the amount of additional community care subsidy payable to the approved provider in respect of that care recipient. This approach reflects the higher costs involved in operating community care aged services in rural and remote areas, including the higher costs associated with attracting and retaining staff.
If the ARIA score for a community care recipient’s residential location is less than 3.52 no additional daily amount of community care subsidy is payable in respect of the care recipient and the amount of community care subsidy payable in respect of the care recipient is $33.30 (as specified in Step 2 of the Determination).
However, where the ARIA score for a community care recipient’s residential location is 3.52 or more, the table in Step 1 of the Determination sets out the additional daily amount that is payable in respect of that care recipient. The additional daily amount set out in the table in Step 1 is added to the basic daily amount of community care subsidy, which Step 2 of the Determination specifies is $33.30.
Approved providers who are eligible to receive an additional amount of community care subsidy in respect of a community care recipient will receive the additional amount of subsidy through Medicare Australia’s payment systems.
The amount of community care subsidy is indexed on 1 July each year. As part of this process, the additional amount of community care subsidy will also be indexed.
The Determination is a “legislative instrument” for the purposes of the Legislative Instruments Act 2003. As the Determination simply provides a new and additional amount of community care subsidy to providers of community care in rural and remote areas, it does not adversely affect the rights of, or impose liabilities on, any person. As such, the Determination does not contravene the rule against retrospectivity in subsection 12(2) of the Legislative Instruments Act 2003.
Consultation
In relation to the additional amount of community care subsidy payable to providers in rural and remote areas, an external reference group was established consisting of representatives from five peak body organisations that deliver rural and remote aged care programs. Consultation with this reference group was integral to the development of the eligibility criteria for the payment of the additional amount of community care subsidy and the additional amounts payable.
No other consultation with industry was undertaken in relation to the remainder of the Determination because the remainder of the Determination is substantially the same as determination ACA Ch. 3 No. 9/2006, which is replaced by the Determination.
Overview
The Aged Care Act 1997, enacted by the Parliament of Australia, was introduced to address the need for a comprehensive framework governing aged care services, ensuring that older Australians receive quality care and support. This Act establishes the regulatory environment for aged care providers, funding mechanisms, and standards of care, aiming to safeguard the rights and well-being of the elderly. The Determination of the amount of Community Care Subsidy, effective from 1 January 2007, outlines the method for calculating the subsidy payable to approved providers for community care recipients, ensuring consistency and fairness in the provision of care across different locations. This legislative instrument aims to support the policy objective of providing equitable access to quality aged care services, particularly in rural and remote areas, by adjusting the subsidy amounts based on the Accessibility/Remoteness Index of Australia (ARIA) scores, thus reflecting the higher costs associated with delivering care in these regions.
Scope and Application
The Determination of the amount of Community Care Subsidy under the Aged Care Act 1997 applies to approved providers of community care, specifying the method to calculate the subsidy payable for each day in respect of a community care recipient. This applies nationally, across Australia, to all approved providers who offer community care services to recipients, taking into account the specific accessibility and remoteness of their residential locations as measured by the Accessibility/Remoteness Index of Australia (ARIA). The basic daily amount of community care subsidy is set at $33.30 and remains unchanged, with an additional subsidy applied to those residing in locations with an ARIA score of 3.52 or higher, reflecting the higher operational costs in rural and remote areas. The additional subsidy is calculated according to the ARIA score, with higher scores corresponding to higher subsidies. The Determination came into effect on 1 January 2007, replacing the previous determination, and is indexed annually on 1 July. The Determination does not adversely affect any existing rights or impose new liabilities, thus complying with the rule against retrospectivity under the Legislative Instruments Act 2003.
Key Provisions
The key operative sections of the Determination of the Amount of Community Care Subsidy (ACA Ch. 3 No. 1/2007) (the Determination) are found in subsection 48-1(3) of the Aged Care Act 1997 (the Act). This section specifies that the amount of community care subsidy payable to an approved provider for a day is either determined by the Minister in writing (subsection 48-1(3)(a)) or worked out in accordance with a method determined by the Minister in writing (subsection 48-1(3)(b)). The Determination implements the latter, providing a method for calculating the amount of community care subsidy payable for a day in respect of a community care recipient. The basic daily amount of community care subsidy, set at $33.30, is specified in Step 2 of the Determination and remains unchanged. Step 1 of the Determination, however, provides for an additional daily amount of community care subsidy for care recipients residing in rural and remote locations with an Accessibility/Remoteness Index of Australia (ARIA) score of 3.52 or more. This additional amount is based on the ARIA score, reflecting the higher costs of operating community care services in more remote areas.
The Determination imposes specific obligations on parties and entities it governs. Approved providers of community care must ensure that they meet the eligibility criteria for receiving the additional community care subsidy. This includes verifying the residential location of the care recipient, using the postcode to determine the ARIA score, and applying the additional amounts specified in Step 1 of the Determination. Providers must also ensure that they comply with the indexing process for the community care subsidy, which occurs annually on 1 July. Any approved provider who is eligible for the additional subsidy must ensure that they are correctly processing these payments through Medicare Australia’s payment systems.
The Determination does not explicitly outline specific offences, penalties, or civil/criminal consequences for breaches of its provisions. However, failure to comply with the requirements for determining and paying the community care subsidy could potentially lead to non-compliance with the Aged Care Act 1997. Non-compliance with the Act may result in administrative penalties, including fines, as prescribed under the relevant provisions of the Act. The specific penalties would depend on the nature and severity of the breach, and any subsequent actions taken by the relevant authorities. Additionally, incorrect application of the ARIA scoring system or failure to accurately calculate the subsidy amount could lead to disputes or claims for overpayment or underpayment, which would need to be resolved in accordance with the Act’s provisions for dispute resolution and recovery of funds.