EXPLANATORY STATEMENT
AGED CARE ACT 1997
SUBSECTION 52-1(1)
AGED CARE (AMOUNT OF FLEXIBLE CARE SUBSIDY – MULTI-PURPOSE SERVICES) DETERMINATION 2005 (NO. 3)
The Aged Care Act 1997 (“the Act”) provides for the funding of aged care services. Persons who are approved under the Act to provide flexible aged care services can be eligible to receive flexible care subsidy payments in respect of the care they provide to approved care recipients.
Subsection 52-1(1) of the Aged Care Act 1997 provides that the Minister may determine in writing the amount of the flexible care subsidy or determine a method which must be used to work out the amount of flexible care subsidy.
Multi-purpose services (MPS) are flexible care services in rural locations that deliver a number of different forms of aged care, health care and community care.
The Australian Government’s 2005-06 Budget allocated $9.3 million over four years for an additional supplement of $20.45 per day for MPS that provide respite services for older Australians and their carers living in rural and remote areas. The implementation date for this initiative, called Recognising Senior Australians: Increasing Rural and Regional Respite Services, is 1 January 2006.
This determination revokes and replaces the previous determination, the Aged Care (Amount of flexible care subsidy – multi-purpose services) Determination 2005 (No. 2), which is also known as ACA Ch. 3 No. 19/2005.
This new determination specifies an additional component to the method for working out the rate of flexible care subsidy payable to MPS from 1 January 2006. The additional component is called the respite supplement equivalent amount. The respite supplement equivalent amount for a day is determined in accordance with a sliding scale of payments set out in clause 12 of the determination for the total number of high care places and low care places allocated in respect of the MPS.
The purpose of the sliding scale is to ensure an equitable distribution of the respite supplement amongst all MPS. No MPS will receive less than $40.90 respite supplement equivalent amount per day, which reflects the 2004 election commitment to provide a minimum of two respite places per MPS per day at $20.45 per place. Further, the sliding scale recognises the economies of scale which are applicable to providing residential care and residential respite care in larger MPS.
The introduction of the respite supplement equivalent amount builds on the existing formula for the flexible care subsidy and provides additional flexible funding to all MPS.
This new determination also changes the way that the flexible care subsidy is worked out. Part 2 of this determination provides that the amount of flexible care subsidy will be worked out per service, rather than per allocated place.
The previous determination provided for amounts of flexible care subsidy payable for high care places, low care places and community care places. The new amount of subsidy, the respite supplement equivalent amount, will be payable on a per MPS basis rather than on a per place basis. Therefore the determination now provides for the total amount of flexible care subsidy payable for a MPS for a day. This total amount comprises the amount payable for a day in respect of high care places, low care places, community care places and the respite supplement equivalent amount.
This new determination also makes some consequential amendments to the headings, wording and numbering of some sections of the previous determination.
For the purposes of consultation, the industry and State Health Departments have been made aware of this Budget measure through the usual post-Budget communication forums and the regular communication mechanisms for the National Respite for Carers Program.
All MPS providers and their auspicing bodies will be informed of the implementation of the respite supplement equivalent amount, and the additional flexible subsidy that they will receive.
This determination is a “legislative instrument” for the purposes of the Legislative Instruments Act 2003.
Overview
The Aged Care (Amount of Flexible Care Subsidy – Multi-Purpose Services) Determination 2005 (No. 3) was enacted to address the need for additional funding for multi-purpose services (MPS) in rural and remote areas, as part of the Australian Government’s commitment to provide increased respite services for older Australians and their carers. This legislative instrument is a response to the Aged Care Act 1997, which establishes the framework for the funding of aged care services and allows the Minister to determine the amount of the flexible care subsidy. The 2005-06 Budget allocated $9.3 million over four years to provide an additional supplement of $20.45 per day for MPS that offer respite services. This initiative, known as Recognising Senior Australians: Increasing Rural and Regional Respite Services, commenced on 1 January 2006, and the new determination introduces a sliding scale for the respite supplement equivalent amount to ensure equitable distribution among all MPS, with a minimum guarantee of $40.90 per day. The policy objective is to enhance the availability and affordability of respite care in rural settings, thereby supporting both care recipients and their carers.
Scope and Application
The Aged Care (Amount of Flexible Care Subsidy – Multi-purpose Services) Determination 2005 (No. 3) applies to multi-purpose services (MPS) that provide flexible aged care services in rural locations, as well as the entities that are approved to provide such services under the Aged Care Act 1997. This determination is applicable nationally across Australia, with the primary focus on enhancing the funding structure for MPS to better support older Australians and their carers in rural and remote areas. It introduces a new component called the respite supplement equivalent amount, which is calculated on a sliding scale based on the number of high care and low care places allocated in the MPS. This supplement ensures an equitable distribution of additional funding among all MPS and guarantees a minimum payment of $40.90 per day, aligning with the 2004 election commitment. The determination also shifts the calculation of the flexible care subsidy from a per place basis to a per service basis, providing a total amount of subsidy for each MPS per day. This new approach recognises the economies of scale inherent in larger MPS and builds on the existing flexible care subsidy formula to provide more flexible funding.
Exclusions and exemptions under this determination are limited to the specific criteria and calculations outlined in the sliding scale for the respite supplement equivalent amount, ensuring that all eligible MPS receive appropriate funding based on their care provision. This legislative instrument operates under the framework established by the Aged Care Act 1997 and is subject to the provisions of the Legislative Instruments Act 2003, which governs the creation and operation of legislative instruments.
Key Provisions
The main provisions of the Aged Care (Amount of Flexible Care Subsidy – Multi-Purpose Services) Determination 2005 (No. 3) pertain to the calculation of flexible care subsidy payments for multi-purpose services (MPS) that provide respite care in rural and remote areas (subsection 52-1(1)). This legislative instrument introduces a new component known as the respite supplement equivalent amount, which is determined based on a sliding scale that considers the total number of high care and low care places in the MPS (clause 12). The minimum respite supplement equivalent amount is set at $40.90 per day, ensuring that each MPS receives a minimum of two respite places per day at $20.45 per place. This sliding scale is designed to provide an equitable distribution of the supplement among all MPS while also recognising the economies of scale in larger services. Additionally, the method of calculating the flexible care subsidy has been modified to be per service rather than per allocated place, which means the subsidy will now cover the total amount payable for high care places, low care places, community care places, and the respite supplement equivalent amount.
Entities governed by this Act, specifically MPS providers and their auspicing bodies, have the obligation to comply with the new method of calculating the flexible care subsidy. They must ensure that they account for the new respite supplement equivalent amount in their daily operations and financial records. This involves understanding the sliding scale and accurately calculating the subsidy based on the number of high care and low care places within their service. Furthermore, these entities must be aware of and adhere to the consequential amendments to the headings, wording, and numbering of sections in the previous determination, which have been updated to reflect the changes introduced by this legislative instrument.
Breaches of the provisions outlined in this determination could potentially result in civil or criminal consequences, although specific offences and penalties are not detailed within the text of this instrument. However, under the general legislative framework, non-compliance with such provisions could lead to enforcement actions by the relevant authorities, including potential financial penalties or other administrative measures. The precise consequences would depend on the nature and severity of the breach, and could involve scrutiny from the Australian Government or relevant state bodies to ensure adherence to the Act and its determinations.