EXPLANATORY STATEMENT
Issued by the authority of the Minister for Ageing
Aged Care Act 1997
Determination under Subsection 44-29(8)
Aged Care (Residential care subsidy – amount of viability 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 can be eligible to receive residential care subsidy payments in respect of the care they provide to approved care recipients.
The residential care subsidy which is payable in a particular case includes a basic amount and can also include various supplements, which are intended to deal with particular circumstances. One such supplement is the viability supplement, which is available to eligible rural and remote providers of aged care services in recognition of the particular difficulties faced by such services as a result of their isolation, small size, characteristics of the majority of their residents, and consequentially higher cost structures. The viability supplement primarily benefits small services operating in rural, remote and isolated areas.
Subsection 44-29(8) of the Act provides that the viability 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. Subsection 44-29(9) of the Act provides that the Minister may determine different amounts or methods based upon certain matters, including the number of places in services, the degree of isolation of the services, and any other matters determined by the Minister by legislative instrument.
In essence, there are three viability supplement schemes – the 1997 scheme (which was put in place when the Act commenced operation); a modified scheme which was put in place in 2001; and the current scheme which commenced operation on 1 January 2005 – which run in parallel. Each scheme has its own criteria for payment and each pays different amounts of viability supplement, depending on the circumstances of the residential care service. For example, the 2005 scheme provides increased assistance to the more rural and remote residential care services.
This Determination is made pursuant to section 44-29(8) of the Act, which sets the amount of the viability supplement which is payable to services determined by the Secretary to be eligible. Details of this Determination are set out in the Attachment.
This Determination reflects the 2009-10 Budget Measure Measures to Support Older Australians – Aged care viability supplements increase - which provided $14.8 million over two years to increase the viability supplement paid to eligible aged care providers in regional, rural and remote areas.
The increase in the Determination is to the 2005 scheme – the current scheme. This measure does not result in a reduction in payment rates to the 1997 or 2001 schemes. If at any point an aged care provider participating in the 1997 or 2001 schemes would receive a higher supplement under the 2005 scheme, it will be transferred to the 2005 scheme.
Consultation
As the increase of the supplement is in accordance with the 2009-10 Budget Measure Measures to Support Older Australians – Aged care viability supplements increase. The policies reflected in the Amending Principle were the subject of consultation with the aged care sector through the Ageing Consultative Committee, which comprises peak industry, professional and consumer bodies.
Information about the increase in the amount of the supplement will be disseminated via print and electronic media to approved providers.
ATTACHMENT
NOTES ON CLAUSES
Clauses 1 and 2 set out the title of the Determination and its commencement date of 1 January 2010.
Clause 3 revokes the previous Determination which set amounts under
section 44-29(8) of the Act.
Clause 4 defines the concepts of “1997 scheme service”, “2001 scheme service” and “2005 scheme service” by reference to section 21.34 in the Residential Care Subsidy Principles 1997. Essentially, each concept refers to services which are subsidised in accordance with the terms of the points test set out in the relevant scheme.
Clause 4 also defines “Principles” as the Residential Care Subsidy Principles 1997.
Clause 5 sets out the amount of viability supplement payable under the 1997 scheme.
Clause 6 sets out the amount of viability supplement payable under the 2001 scheme.
Clause 7 sets out the amount of viability supplement payable under the 2005 scheme. The amount payable under this scheme has increase in the Determination in accordance with the 2009 – 10 Budget Measure - Measures to Support Older Australians – Aged care viability supplements increase.
Clause 8 sets out the amount of supplement payable to former 1997 or 2001 scheme services where the score attained by the services on the day under the scoring system set out in the table in subsection 21.35C (1) of the Residential Care Subsidy Principles 1997 is 40 or 45.