EXPLANATORY STATEMENT
Issued by the authority of the Minister for Ageing
Aged Care Act 1997
Aged Care (Residential care subsidy – amount of accommodation supplement) Determination 2009 (No. 2)
The Aged Care Act 1997 (the Act) provides for the funding of aged care services. Persons who are approved under the Act to provide residential aged care services (approved providers) can be eligible to receive residential care subsidy payments in respect of the care they provide to approved care recipients.
Subsection 44-5A(3) of the Act provides that the accommodation supplement for a particular 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 accommodation supplement is payable in respect of supported residents receiving care in eligible services (for example services that are certified and are not providing care to the resident on an extra service basis).
In summary, supported residents are those who are being provided with residential care through a residential care service, who entered care on or after 20 March 2008 and whose assets are below a certain maximum asset threshold or in respect of whom the Secretary has made a financial hardship determination.
This Determination sets out a method for working out the amount of the accommodation supplement and sets the maximum rate of accommodation supplement for a service that does not meet building requirements at $25.49 or if on the day the service does not meet those requirements at $25.49 with effect from 20 September 2009 and revokes Determination ACA Ch. 3 No. 2/2009.
Consultation
The Department of Health and Ageing (the Department) undertook extensive consultation on the policy, which included policy on increases in the rates of supplements, that was implemented through the Aged Care Amendment (2008 Measures No. 1) Act 2008 and related amendments to the Principles and other instruments made under the Act.
Further consultation was undertaken by the Department on aged care funding arrangements as part of the Review of the Conditional Adjustment Payment and there is ongoing consultation with the aged care industry on funding arrangements.
As the indexation of the supplement uses a well established formula based on the consumer price index, 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 accommodation supplement will be disseminated via print and electronic media to approved providers.
Overview
The Aged Care (Residential care subsidy – amount of accommodation supplement) Determination 2009 (No. 2) was enacted to address the need for an updated method of calculating the accommodation supplement for residential care provided under the Aged Care Act 1997. This Determination was introduced by the Minister for Ageing and is intended to ensure that the accommodation supplement remains aligned with changes in the cost of living, as measured by the consumer price index. The policy objective of this Determination is to maintain the integrity of the residential care subsidy scheme by providing a fair and consistent method for calculating the accommodation supplement.
The Department of Health and Ageing undertook extensive consultation on the policy changes, including increases in the rates of supplements, which were implemented through the Aged Care Amendment (2008 Measures No. 1) Act 2008. The Determination sets the maximum rate of accommodation supplement for services that do not meet building requirements at $25.49, effective from 20 September 2009, and revokes the previous Determination ACA Ch. 3 No. 2/2009. Information about these changes will be communicated to approved providers through print and electronic media.
Scope and Application
The Aged Care Act 1997 provides for the funding of aged care services, and the accompanying Aged Care (Residential care subsidy – amount of accommodation supplement) Determination 2009 (No. 2) further specifies the details of the residential care subsidy payments. This legislation applies to approved providers who are approved under the Act to offer residential aged care services and who are eligible to receive residential care subsidy payments for the care they provide to approved care recipients. The accommodation supplement is applicable to supported residents receiving care in eligible services, which are certified and do not provide care on an extra service basis. To qualify as a supported resident, the individual must have entered care on or after 20 March 2008 and must have assets below a certain maximum threshold or have a financial hardship determination made by the Secretary. This Determination sets out the method for calculating the amount of the accommodation supplement, which is indexed using a well-established formula based on the consumer price index, and sets the maximum rate of accommodation supplement for services that do not meet building requirements. The Act applies nationally across Australia, and the Department of Health and Ageing has undertaken extensive consultation on the policy and funding arrangements. This Determination revokes the previous Determination ACA Ch. 3 No. 2/2009.
Key Provisions
The Aged Care (Residential Care Subsidy – Amount of Accommodation Supplement) Determination 2009 (No. 2) (the Determination) is a legislative instrument made under the Aged Care Act 1997. It specifies the method for calculating the amount of the accommodation supplement that is payable to approved providers for the care of eligible supported residents (subsection 44-5A(3)). The accommodation supplement is a financial assistance provided to cover the cost of accommodation for eligible residents in residential aged care services. The Determination sets out that the accommodation supplement is to be calculated using a specified method and fixes the maximum rate of the accommodation supplement at $25.49 per day for services that do not meet building requirements, effective from 20 September 2009. This Determination also revokes the previous Determination ACA Ch. 3 No. 2/2009.
The Determination imposes specific obligations on approved providers of residential aged care services, who must comply with the prescribed method for calculating the accommodation supplement. It also requires that the accommodation supplement is paid in respect of eligible supported residents, who are defined as those entering care on or after 20 March 2008, with assets below a certain threshold, or for whom a financial hardship determination has been made by the Secretary. Approved providers must ensure that the services they provide meet the eligibility criteria for the accommodation supplement, which includes the provision of care in certified services and not on an extra service basis.
Breach of the requirements set out in the Determination may result in civil or criminal consequences, depending on the nature and severity of the breach. The Aged Care Act 1997 provides for various penalties, including fines and imprisonment, for non-compliance with the Act and its subsidiary legislation. The maximum penalties for contravening the Act or its associated regulations are set out in the Act itself and may vary depending on the specific offence. It is important for approved providers to be aware of their obligations under the Determination and to ensure compliance to avoid potential penalties.