EXPLANATORY STATEMENT
Issued by the authority of the Minister For Ageing
AGED CARE ACT 1997
Determination under Section 44-19
Aged Care (Residential Care Subsidy – Adjusted Subsidy Reduction) Determination 2009 (No. 1)
Subsection 44-19(2) of the Aged Care Act 1997 (the Act) provides that the Minister may determine by legislative instrument the amount of the adjusted subsidy reduction.
Under the National Health Act 1953, nursing homes that had transferred from State Government funding to Commonwealth nursing home funding were known as “adjusted fee government nursing homes”. They were paid a discounted rate of standard infrastructure funding.
The discounted subsidy translated into the Act as the adjusted subsidy reduction. This is a reduction to the daily subsidy per resident equivalent to the discount that applied before 1 October 1997. It only applies to services that were approved as “adjusted fee government nursing homes” under the previous arrangements.
This Determination sets the adjusted subsidy reduction amount as $11.17 with effect from 1 July 2009, and revokes Determination ACA Ch. 3 No. 16/2008.
Paragraph 44-19 (1)(b) of the Act provides for the Minister to determine in writing that a residential care service, or part of a residential care service through which the care is provided, is an adjusted subsidy residential care service. The Minister’s determination under this section of the Act (ACA Ch 3. No. 5/2007) was updated on 13 June 2007 to remove those adjusted subsidy places that are now owned by the non-government sector.
Consultation
As the indexation of the adjusted subsidy reduction uses well established formula based on the Consumer Price Index and Wage Cost Index 9, and is in accordance with policy upon which extensive consultation was undertaken, no specific consultation was undertaken with respect to this instrument.
Information about the increase in the amount of the adjusted subsidy reduction will be disseminated via print and electronic media to approved providers.
Overview
The Aged Care Act 1997 was enacted to establish a framework for the provision of aged care services in Australia, aiming to ensure that older Australians receive quality care and support. One aspect of this legislation involves the Residential Care Subsidy, which includes an adjusted subsidy reduction for certain nursing homes that transitioned from state to Commonwealth funding. The Aged Care (Residential Care Subsidy – Adjusted Subsidy Reduction) Determination 2009 (No. 1) was introduced to specify the amount of this reduction, addressing a gap in the subsidy structure for particular services that were previously known as "adjusted fee government nursing homes." This legislative instrument, issued by the Minister for Ageing under the authority of the Aged Care Act 1997, sets the adjusted subsidy reduction at $11.17 effective from 1 July 2009, thereby ensuring that the subsidy reflects the historical discount applied before 1 October 1997. The policy objective is to maintain consistency and fairness in the funding of residential care services for the aged.
Scope and Application
The Aged Care (Residential Care Subsidy – Adjusted Subsidy Reduction) Determination 2009 (No. 1) applies to residential care services that were previously classified as "adjusted fee government nursing homes" under the National Health Act 1953, now transitioned to Commonwealth funding. This determination specifically sets the adjusted subsidy reduction amount at $11.17 per resident equivalent, effective from 1 July 2009, and it revokes the previous Determination ACA Ch. 3 No. 16/2008. The application of this legislation is confined to services that were approved under the former arrangements as adjusted fee government nursing homes, thus it does not extend to all residential care services universally. The jurisdiction of this determination is under the Aged Care Act 1997, indicating its reach is within the Commonwealth framework, impacting approved providers through the adjustment in subsidy rates. There are no exclusions or exemptions explicitly mentioned, and it is applicable to all relevant services under the specified conditions. The application of this Act can potentially be extended or restricted through subordinate instruments, as authorised by Subsection 44-19(2) of the Act.
Key Provisions
The main operative sections of the Aged Care (Residential Care Subsidy – Adjusted Subsidy Reduction) Determination 2009 (No. 1) set the amount of the adjusted subsidy reduction, which is a reduction to the daily subsidy per resident equivalent, for certain services that were previously approved as “adjusted fee government nursing homes” under the National Health Act 1953 (sections 1 and 2). The determination specifies that the adjusted subsidy reduction amount is $11.17, effective from 1 July 2009, and revokes a previous determination (section 3). Additionally, the Act allows the Minister to determine in writing that a residential care service, or part of a residential care service, is an adjusted subsidy residential care service (subsection 44-19(1)(b)).
The Act imposes obligations on the Minister, requiring them to determine the amount of the adjusted subsidy reduction using a well-established formula based on the Consumer Price Index and Wage Cost Index. The Minister is also required to update the list of adjusted subsidy residential care services as necessary, removing those services now owned by the non-government sector (subsection 44-19(2)). Furthermore, the Minister must ensure that information about the adjusted subsidy reduction is disseminated to approved providers through print and electronic media.
Breaches of the requirements under the Aged Care Act 1997 may lead to various civil or criminal consequences. However, the specific Determination itself does not outline offences or penalties. The consequences of non-compliance with the Act, including potential fines and imprisonment, are governed by the broader provisions of the Aged Care Act 1997. The penalties for non-compliance with the Act can vary, with maximum penalties including fines and imprisonment terms as specified in the Act. It is important for parties and entities governed by the Act to adhere to its provisions to avoid such consequences.