EXPLANATORY STATEMENT
Issued by the authority of the Minister for Mental Health and Ageing
Aged Care Act 1997
Aged Care (Community Care Subsidy Amount) Determination 2011 (No. 1)
The Aged Care Act 1997 (the Act) provides for the regulation and funding of aged care services. Persons who are approved under the Act to provide community aged care services can be eligible to receive community care subsidy payments in respect of the care they provide to approved care recipients.
Community care is care consisting of a package of personal care services and other personal assistance provided to a person who is not being provided with residential care. An approved provider is eligible for community care subsidy if it holds an allocation of places for community care subsidy and has a community care agreement in force with an approved care recipient and provides community care in accordance with that agreement.
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 determined by the Minister by legislative instrument or worked out in accordance with a method determined by the Minister by legislative instrument.
The purpose of the Aged Care (Community Care Subsidy Amount) Determination 2011 (No. 1) ‘the Determination’ is to specify the method for working out the amount of community care subsidy payable for a day in respect of a community care recipient, with rates effective from 1 July 2011. This Determination also revokes Aged Care (Community Care Subsidy Amount) Determination 2010 (No. 1).
The difference between the Determinations is that the daily amount of community care subsidy payable has been indexed in accordance with standard indexation arrangements.
The total amount of community care subsidy payable in respect of a care recipient is the sum of following amounts as set out in the Determination:
- the base subsidy amount
- an additional amount payable to an approved provider of community care who provides community care to a care recipient in a rural or remote location, provided that location has an Accessibility/Remoteness Index of Australia (ARIA) score of 3.52 or more. The additional daily amount increases as the ARIA score (the measure of accessibility and remoteness of the geographical location at which the care recipient resides) increases.
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 Department of Health and Ageing.
Further details of this Determination are attached.
Consultation
Indexation of the subsidy uses a well established formula based on the Consumer Price Index as a measure of the movements in the non-labour costs of providers and the decisions of Fair Work Australia as a measure of non-productivity based movements in the wage costs of providers. As this is in accordance with policy upon which extensive consultation was undertaken, no specific consultation was undertaken with respect to this indexation.
Information about the increase in the amount of the subsidy will be disseminated via electronic media to approved providers.
This Determination commences on 1 July 2011.
The Determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Overview
The Aged Care Act 1997 was enacted to provide for the regulation and funding of aged care services in Australia. This legislation was introduced to address the need for a structured framework governing the provision of aged care services, ensuring that providers and recipients alike are protected and provided for under a coherent legal regime. The Act establishes the parameters within which community care services can be delivered and funded, ensuring that both providers and recipients are aware of their rights and obligations. The Aged Care (Community Care Subsidy Amount) Determination 2011 (No. 1) was issued under the authority of the Minister for Mental Health and Ageing to specify the method for calculating the amount of community care subsidy payable to approved providers for the care of recipients, effective from 1 July 2011. This Determination ensures the subsidy amounts are indexed appropriately, reflecting changes in economic conditions and maintaining the viability of community care services. The policy objective behind this Determination is to provide a transparent and fair method for subsidy calculations, thereby supporting the sustainability and accessibility of community care services across different geographical locations in Australia.
Scope and Application
The Aged Care (Community Care Subsidy Amount) Determination 2011 (No. 1) operates under the Aged Care Act 1997, which governs the regulation and funding of aged care services in Australia. The Determination specifies the method for calculating the community care subsidy payable for a day to care recipients who are not receiving residential care, effective from 1 July 2011. This legislation applies to approved providers of community aged care services who hold an allocation of places for community care subsidy and have a community care agreement in force with an approved care recipient. The Determination revokes the previous Aged Care (Community Care Subsidy Amount) Determination 2010 (No. 1) and includes an indexation of the subsidy rates based on the Consumer Price Index and decisions by Fair Work Australia. The increased subsidy amount is disseminated to approved providers via electronic media. The legislation applies across Australia, with the ARIA score used to determine additional amounts for care provided in rural or remote locations, ensuring that care in less accessible areas is adequately compensated.
Key Provisions
The Aged Care (Community Care Subsidy Amount) Determination 2011 (No. 1) specifies the method for calculating the daily amount of community care subsidy payable to approved providers under the Aged Care Act 1997. The primary focus of this Determination is to set out the rates effective from 1 July 2011, which includes an indexed amount compared to the previous year's rates. This Determination revokes the Aged Care (Community Care Subsidy Amount) Determination 2010 (No. 1), reflecting the updated rates and the indexation process. The new rates have been determined by applying standard indexation arrangements to ensure the subsidy keeps pace with inflation and other economic factors.
Approved providers of community aged care services who hold an allocation of places for community care subsidy and have a community care agreement in force with an approved care recipient are eligible for these payments. The total amount of community care subsidy payable is the sum of the base subsidy amount and any additional amounts payable for care provided in rural or remote locations. The additional daily amount increases according to the Accessibility/Remoteness Index of Australia (ARIA) score of the location where the care recipient resides, with higher scores indicating greater remoteness and attracting a higher subsidy. ARIA scores are allocated based on the accessibility and remoteness of each suburb and town in Australia, and detailed information is available in the document 'Viability Funding — ARIA scores for locations as at 30 July 1999', published by the Department of Health and Ageing.
Under the Act, approved providers must adhere to the terms of their community care agreements and ensure that the care provided aligns with the requirements set out in the Determination. The approved provider must also maintain records and documentation necessary to substantiate their subsidy claims. The Act imposes an obligation on providers to accurately calculate and claim the correct amount of subsidy based on the method outlined in the Determination, ensuring they are compliant with all legislative requirements.
Breaches of the Act or the Determination may result in various consequences, including the recovery of any overpaid subsidies, financial penalties, and potential legal action. The specific penalties for non-compliance are not detailed in the Determination but would typically be outlined in the Aged Care Act 1997 or related regulations. The Determination notes that the indexation of the subsidy uses well-established formulas based on the Consumer Price Index and Fair Work Australia decisions, and extensive consultation was undertaken as part of the policy process. Information about the increase in the subsidy amount will be disseminated to approved providers via electronic media. The Determination commences on 1 July 2011 and is a legislative instrument under the Legislative Instruments Act 2003.