EXPLANATORY STATEMENT
Issued by the authority of the Minister for Ageing
Aged Care Act 1997
Aged Care (Residential care subsidy – amount of transitional accommodation supplement) Determination 2008 (No. 2)
(ACA Ch. 3 No. 26/2008)
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 44-16(1) of the Act provides that the Residential Care Subsidy Principles 1997 (the Principles) may provide for additional primary supplements.
Subsection 44-16(3) of the Act provides that the Minister may determine in writing the amount of each additional primary supplements or the way in which the amount of the supplement is to be worked out.
Section 21.25E of the Principles provides for the ‘transitional accommodation supplement’ (TAS) which is a type of additional primary supplement. That section also sets out the circumstances in which TAS is payable.
The purpose of TAS is to smooth the introduction of the new accommodation payment arrangements, which took effect from 20 March 2008. To this end, the Commonwealth will pay aged care providers TAS in respect of certain post-2008 reform residents who enter care (for which the resident is eligible to pay an accommodation bond) between 20 March 2008 and 19 September 2011 inclusive.
The Aged Care (Residential care subsidy – amount of transitional accommodation supplement) Determination 2008 (No. 2) (the Determination) sets the amounts of TAS for such residents.
The Determination provides that the amount of TAS that is payable in respect of residents who enter residential care for the first time after 19 March 2008 (or re-enter residential care after 19 March 2008, having had a break in residential care of more than 28 days), varies depending on the date of the resident’s entry (or re-entry) to a residential care service:
- for residents who enter on or after 20 September 2008 and before 20 September 2010, TAS is the full pensioner supplement amount ($6.83) less the amount of accommodation supplement payable for the care recipient;
- for residents who enter on or after 20 September 2010 and before 20 March 2011, TAS is 2/3 the rate of the pensioner supplement ($4.55) less the amount of accommodation supplement payable for the care recipient; and
- for residents who enter on or after 20 March 2011 and before 20 September 2011, TAS is 1/3 the rate of the pensioner supplement ($2.27) less the amount of accommodation supplement payable for the care recipient.
TAS is not payable for residents who enter residential care for the first time on or after 20 September 2011.
The effect of this is that initially TAS will fully offset the loss of pensioner supplement and largely offset the loss of the additional basic daily fee paid by self‑funded retirees or pensioners who have paid a ‘big bond’. This will allow approved providers time to adjust to the new accommodation payment arrangements.
Once TAS is payable, it will continue to be paid for the entire period that the resident is in residential care. If the resident moves, and the break in residential care is less than 28 days, the same rate of TAS will be payable in the following service.
The Determination commences on 20 September 2008. The Determination revokes and replaces the Aged Care (Residential care subsidy – amount of transitional accommodation supplement) Determination 2008 (the previous Determination).
The Determination contains minor differences to the previous Determination in that the amount of TAS that is payable in respect of specified residents is increased.
This Determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Consultation
As the indexation of this supplement uses a well established formula for indexation, no specific consultation with industry was undertaken with respect to this instrument.
Overview
The Aged Care (Residential care subsidy – amount of transitional accommodation supplement) Determination 2008 (No. 2) was enacted to address the gap in transitional support for aged care services in the wake of new accommodation payment arrangements. This Determination, issued under the Aged Care Act 1997, specifies the transitional accommodation supplement (TAS) amounts for certain residents entering care between 20 March 2008 and 19 September 2011. The policy objective of this legislation, overseen by the Minister for Ageing, is to facilitate a smoother transition for aged care providers and recipients by mitigating the immediate financial impact of the new payment arrangements. By setting varying rates of TAS based on the date of entry, the Determination aims to provide adequate support during the transition period, ensuring that aged care providers have sufficient time to adapt to the new system while safeguarding the interests of care recipients.
Scope and Application
The Aged Care (Residential care subsidy – amount of transitional accommodation supplement) Determination 2008 (No. 2) applies to approved providers under the Aged Care Act 1997 who are eligible to receive residential care subsidy payments for the care they provide to approved care recipients. This Determination specifically governs the transitional accommodation supplement (TAS), which is a type of additional primary supplement, and is designed to assist aged care providers in adjusting to new accommodation payment arrangements that came into effect on 20 March 2008. The Determination outlines the amounts of TAS payable to certain post-reform residents who enter care between 20 March 2008 and 19 September 2011, with the rates varying depending on the date of entry. The Commonwealth will pay the TAS in respect of eligible residents to smooth the transition and provide financial support during this period. The Determination revokes and replaces a previous Determination from 2008, increasing the amount of TAS payable to specified residents. The instrument operates nationally and is subject to the Legislative Instruments Act 2003.
Key Provisions
The main operative sections of the Aged Care (Residential care subsidy – amount of transitional accommodation supplement) Determination 2008 (No. 2) (the Determination) establish the rates for the transitional accommodation supplement (TAS) for residential aged care services. Section 4 sets out the specific amounts of TAS to be paid based on the date of entry or re-entry into residential care by the resident, ranging from the full pensioner supplement amount less the accommodation supplement payable for residents entering or re-entering care before 20 September 2008, to one-third of the pensioner supplement amount less the accommodation supplement payable for residents entering or re-entering care after 20 March 2011. Section 5 clarifies that TAS is not payable for residents entering care on or after 20 September 2011. These provisions aim to smooth the transition to new accommodation payment arrangements by providing financial support to approved providers during the period of adjustment.
The obligations imposed by the Determination on the parties it governs primarily concern the calculation and payment of TAS to approved providers. Approved providers must ensure that they meet the eligibility criteria for receiving TAS as outlined in the Determination, including the specific dates of entry or re-entry into residential care for the residents. They must also accurately calculate the amount of TAS payable based on the resident's date of entry and the applicable rates set out in the Determination. The Commonwealth, on the other hand, is obligated to make the TAS payments to approved providers in accordance with the specified rates and conditions.
Breaching the requirements set out in the Determination can lead to civil and administrative consequences. For instance, if an approved provider incorrectly claims or overclaims TAS, they may be subject to financial penalties, recovery of overpayments, and potential audits by the Department of Health. The Determination does not explicitly outline criminal penalties for breaches, but failure to comply with the Act's provisions could potentially lead to more severe legal consequences if the breaches are found to be wilful or fraudulent. The maximum penalties for such offences would typically be determined by the broader provisions of the Aged Care Act 1997 and related legislation.