EXPLANATORY STATEMENT
Issued by the authority of the Minister for Ageing
Aged Care Act 1997
Aged Care (Residential Care Subsidy – Amount of Transitional Supplement)
Determination 2010 (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 44-16(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, by legislative instrument, the amount of each additional primary supplements or the way in which the amount of the supplement is to be worked out.
The purpose of the Aged Care (Residential Care Subsidy – Amount of Transitional Supplement) Determination 2010 (No. 2) (the Determination) is to set the amount of the transitional supplement with effect from 20 September 2010. This Determination also revokes Aged Care (Residential care subsidy – amount of transitional supplement) Determination 2010 (No. 1).
The difference between the Determinations is that the amount of transitional supplement for a day has been increased in accordance with increases in the consumer price index (CPI) as a measure of movements in the non-labour costs of providers.
Consultation
The Department of Health and Ageing 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 instruments.
Further consultation was undertaken as part of the Review of the Conditional Adjustment Payment and is ongoing in relation to funding arrangements.
Indexation of the supplement uses a well established formula based on the CPI as a measure of the movements in the non-labour 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 instrument.
Information about the increase in the amount of the supplement will be disseminated via print and electronic media to approved providers.
The Determination is a legislative instrument for the purposes of the Legislative Instruments Act 2003.
Overview
The Aged Care (Residential Care Subsidy – Amount of Transitional Supplement) Determination 2010 (No. 2) was introduced by the Minister for Ageing to address a gap in the provision of adequate funding adjustments for residential care subsidies under the Aged Care Act 1997. This legislative instrument aims to ensure that the transitional supplement for residential aged care is appropriately indexed to reflect changes in the cost of living, particularly non-labour costs, thereby supporting the financial sustainability of approved providers. The determination was enacted by the Parliament of Australia and reflects a policy objective to maintain fair and reasonable funding levels in the aged care sector, in line with movements in the consumer price index. This approach was developed following extensive consultation with stakeholders and is designed to provide a stable and predictable funding environment for approved providers.
Scope and Application
The Aged Care Act 1997 applies to approved providers who offer residential aged care services and the approved care recipients they serve. These approved providers, recognised under the Act, are eligible to receive residential care subsidy payments for the care they provide to approved care recipients. The Act's jurisdiction covers the entire Commonwealth of Australia, ensuring that the provisions apply nationally. The Aged Care (Residential Care Subsidy – Amount of Transitional Supplement) Determination 2010 (No. 2) sets the amount of the transitional supplement for residential care subsidies, adjusting the supplement amount in accordance with increases in the consumer price index (CPI) to reflect changes in the non-labour costs of providers. This Determination revokes the previous Aged Care (Residential care subsidy – amount of transitional supplement) Determination 2010 (No. 1), implementing the latest adjustments based on CPI movements. The Determination is a legislative instrument created under the Legislative Instruments Act 2003, which may extend or restrict application through subordinate instruments.
Key Provisions
The main operative sections of the Aged Care (Residential Care Subsidy – Amount of Transitional Supplement) Determination 2010 (No. 2) concern the setting of the amount of the transitional supplement for residential care subsidy payments under the Aged Care Act 1997. Specifically, Section 4 of the Determination sets the amount of the transitional supplement effective from 20 September 2010. It specifies the increased rate of the supplement based on the changes in the consumer price index (CPI), reflecting the non-labour costs of providers. Additionally, this Determination revokes the previous Aged Care (Residential care subsidy – amount of transitional supplement) Determination 2010 (No. 1) to ensure there is no confusion or overlap in the application of the new rates.
The Aged Care (Residential Care Subsidy – Amount of Transitional Supplement) Determination 2010 (No. 2) imposes specific obligations on approved providers of residential aged care services. These providers are required to ensure that they adhere to the new rates of the transitional supplement as set out in the Determination when claiming residential care subsidy payments. Furthermore, they must comply with the notification requirements regarding the changes in the supplement amount, ensuring that they are appropriately informed and updated about any changes to the subsidy payments they receive.
In terms of breaches and consequences, the Determination does not explicitly outline specific offences, penalties, or civil or criminal consequences for non-compliance. However, under the Aged Care Act 1997, failure to comply with the requirements for receiving residential care subsidy payments could potentially lead to recovery of overpayments, administrative penalties, or other sanctions as deemed appropriate under the Act. The precise consequences would be determined in accordance with the general provisions of the Aged Care Act and any other relevant legislation.
The Determination itself is a legislative instrument created under the Legislative Instruments Act 2003, which means it carries the force of law and must be registered on the Federal Register of Legislative Instruments. The Department of Health and Ageing undertook extensive consultation on the policy changes, which were implemented through the Aged Care Amendment (2008 Measures No. 1) Act 2008 and related instruments. Information about the increase in the supplement amount will be disseminated to approved providers through various media to ensure transparency and compliance with the new rates.