EXPLANATORY STATEMENT
Issued by the authority of the Minister for Health and Aged Care
Aged Care Act 1997
Aged Care (Subsidy, Fees and Payments) Amendment (Viability Supplement) Determination 2016
Authority
The authority for the Aged Care (Subsidy, Fees and Payments) Amendment (Viability Supplement) Determination 2016 (the Amending Determination) is subsection 44-27(3) and subsection 48-9(3) of the Aged Care Act 1997 (the Act) and subsection 33(3) of the Acts Interpretation Act 1901.
Purpose
The purpose of the Amending Determination is to amend the Aged Care (Subsidy, Fees and Payments) Determination 2014 (Determination) to give effect to the ‘Aged care provider funding – improving the targeting of the viability supplement for regional aged care facilities’ measure that was announced as part of Budget 2016-17.
Background
The viability supplement is a payment made under the Subsidy Principles 2014 (Subsidy Principles) to improve the capacity of small, rural aged care services to offer quality care to care recipients. The Australian Government’s 2016-17 Budget provided for an extra $102.3 million over four years from 2016-17 to target the viability supplement more effectively to areas of greatest need by replacing the current out-dated remoteness classification system with the more up to date Modified Monash Model (MMM), with effect from 1 January 2017.
Details
The Amending Determination varies the amount of viability supplement payable in residential care, home care and flexible care in alignment with the Subsidy Amendment (Viability Supplement) Principles 2016.
Consultation
Consultation occurred through the Aged Care Financing Authority’s report Financial Issues Affecting Rural and Remote Provider, which identified greater cost pressures in rural and remote areas and noted that the geographical classification system of the viability supplement in aged care was out-dated and may not be best targeting funding. There were a total of 36 submissions received. Submissions were received from a mix of providers, including not-for-profit, government organisations, regional alliances and peak representative groups.
To support the Budget announcement a fact sheet ‘Changes to the Viability Supplement’ was published on 4 May 2016 providing detail on the Budget measure. Provider peak bodies such as Aged and Community Services Australia, Catholic Health Australia and Leading Age Services Australia made public statements that the changes were welcome.
This Determination commences on 1 January 2017.
This Determination is a legislative instrument for the purposes of the Legislation Act 2003.
Regulation Impact Statement
The Office of Best Practice Regulation (OBPR) has advised that the amendment does not appear to have regulatory impacts on business, community organisations or individuals (OBPR 20306).
ATTACHMENT
Details of the Aged Care (Subsidy, Fees and Payments) Amendment (Viability Supplement) Determination 2016
1 Name of Determination
Section 1 states that the name of the amending Determination is Aged Care (Subsidy, Fees and Payments) Amendment (Viability Supplement) Determination 2016.
2 Commencement
Section 2 states that these amendments commence on 1 January 2017.
3 Authority
This section provides the authority for making this instrument. This instrument is made under the Aged Care Act 1997.
4 Schedules
This section provides that each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other items in a Schedule to this instrument has effect according to its terms.
Schedule 1 Amendments
Item 1 - Section 4
This item inserts the definition of the Modified Monash Model classification.
Item 2 - Section 56
This item inserts the definition of the 2017 scheme service.
Item 3 – Section 59
This item amends section 59 to make a technical amendment to provide consistency across the Subsidy Principles and the Determination.
Item 4 - Subsection 60(1)
This item amends subsection 60(1) to make a technical amendment to clarify the operation of the safety net for former 1997 scheme services and 2001 scheme services. Subsection (1) qualifies eligibility for the safety net and subsection (2) lists the amount of viability supplement payable.
Item 5 - At the end of Division 3 of Part 4 of Chapter 2
This item introduces new section 60A and section 60B. New section 60A stipulates the amount of viability supplement payable to residential care services as per the 2017 scheme.
New section 60B outlines the amount of viability supplement payable to a residential care service; previously eligible for the 1997 scheme or 2001 scheme (and certain 2005 scheme services), which score below the threshold in section 60A. This provision is consistent with safety net provisions set out in the 2005 scheme (section 60). Subsection (1) stipulates the requirements of this provision. Subsection (2) qualifies the eligibility criteria for services that are former 1997 and 2001 scheme services. Subsection (3) qualifies the eligibility criteria for services that are certain former 2005 scheme services, which are services eligible for the 2005 scheme that were formerly 1997 and 2001 scheme services. Subsection (4) lists the amount of viability supplement payable.
Item 6 - After section 84
This item creates a new section 84A which stipulates the definitions and amounts payable as per the ARIA and MMM classifications for home care viability supplement.
This item defines certain terms used in the Determination:
ARIA value has the same meaning as in the Subsidy Principles .
ARIA value viability supplement amount stipulates the amount of viability supplement payable corresponding to the location of the eligible care recipient.
MMM classification viability supplement amount stipulates the amount of viability supplement payable corresponding to the suburb or locality of the eligible care recipient.
Item 7 - Section 85
This item amends section 85. The new section 85 clarifies eligibility requirements for viability supplement amounts listed in section 84; and stipulates grandparenting arrangements for a home care service on behalf of a care recipient.
New subsection 85(1) stipulates that the MMM classification viability supplement amount is payable to care recipients who receive home care in a suburb or locality with a score of MMM 4 or greater. This subsection applies to care recipients that have entered care on or after 1 January 2017; and care recipients that were in care prior to 1 January 2017 that have subsequently relocated suburb or locality.
New subsection 85(2) outlines that the amount of viability supplement payable is the greater of the ARIA value viability supplement amount or the MMM classification viability supplement amount for a care recipient that had been in care prior to 1 January 2017. Care recipients, in care prior to 1 January 2017, who have relocated suburb or locality, are excluded from this subsection.
New subsection 85(3) stipulates that the ARIA value viability supplement amount is payable to care recipients, in care prior to 1 January 2017, ineligible for the MMM classification viability supplement amount, in a location that has an ARIA value of 3.52 or greater. Care recipients, in care prior to 1 January 2017, who have relocated suburb or locality, are excluded from this subsection.
Item 8 - Section 87
This item inserts the definitions and payment rates for ARIA and MMM; specifically in relation to the additional amount of home care subsidy for multi-purpose services.
This item defines certain terms used in the Determination:
ARIA value additional amount stipulates the amount for a home care place corresponding to the location of the multi-purpose service.
Category D service cross-references its definition to section 90A of the Determination.
MMM classification additional amount stipulates the amount for a home care place corresponding to the street address of the multi-purpose service.
Item 9 - Section 87 (after paragraph (c) of the definition of viability supplement equivalent amount)
This item inserts Category D into the definition of the viability supplement equivalent amount. Category D will broadly operate as per Category C; with the only distinction relating to Category D categorising the street address of the multi-purpose service by the MMM score.
Item 10 - Paragraph 88(1)(b)
This item amends paragraph 88(1)(b) to specify that a service cannot be a Category A service if its meets the requirement of either Category C or Category D.
Item 11 - Paragraph 89(1)(b)
This item amends paragraph 89(1)(b) to specify that a service cannot be a Category B service if its meets the requirement of either Category C or Category D.
Item 12 - Subsection 90(1)
This item amends subsection 90(1) to specify that a service cannot be a Category C service if it meets the requirement of Category D.
Item 13 - At the end of Division 2 of Part 1 of Chapter 4
This item creates a new section 90A. New section 90A specifies the eligibility criteria for a multi-purpose service to qualify as a Category D service for the viability supplement equivalent amount. The criteria is broadly similar to that of a Category A, Category B and Category C service, but differs on the basis of the geographical classification methodology.
Subsection 90A(1) and 90A(2)(a)-(b) clarifies the requirements of a Category D service; including that a Category D service no longer qualifies as a Category A, Category B or Category C service; and the service must score at least 50 points under the scoring system set out in the table featured in the subsection.
The table in subsection 90A(2)(b) lists the criterion for a multi-purpose service to qualify as a Category D service:
- Item 1sets out points for MMM score.
- Item 2 sets out points for the number of places held by the multi-purpose service.
- Item 3 sets out points for special needs.
Paragraphs 90A(3)(a)-(b) outlines that a multi-purpose service that was eligible under Category A will become a Category D service if the service scores at least 50 points under subsection 90A(2)(b); and the amount of viability supplement equivalent amount is equal to or more than the amount payable to a Category A service.
Paragraphs 90A(4)(a)-(b) outlines that a multi-purpose service that was eligible under Category B will become a Category D service if the service scores at least 50 points under subsection 90A(2)(b); and the amount of viability supplement equivalent amount is equal to or more than the amount payable to a Category B service.
Paragraphs 90A(5)(a)-(b) outlines that a multi-purpose service that was eligible under Category C will become a Category D service if the service scores at least 50 points under subsection 90A(2)(b); and the amount of viability supplement equivalent amount is equal to or more than the amount payable to a Category C service.
Item 14 - Section 96
This item specifies the eligibility requirements for the additional home care subsidy amount; and introduces grandparenting arrangements. New paragraph 96(1)(a) outlines that the MMM classification additional amount is payable to a multi-purpose service home care place, if the home care place attracts an equal or greater amount of MMM classification additional amount compared with the ARIA value additional amount.
New paragraph 96(1)(b) outlines that the ARIA value additional amount is payable if the multi-purpose service home care place attracts a greater ARIA value additional amount compared with the MMM classification additional amount.
The new paragraphs 96(2)(a)-(b) complements paragraphs 96(1)(a)-(b) by outlining the circumstances for which multi-purpose service home care places are subject to grandparenting provisions through 96(1)(b). Paragraph 96(2)(a) specifies that the service was either a Category A, Category B or Category C service immediately before 1 January 2017; and paragraph 96(2)(b) specifies that the ARIA value additional amount for day must be greater than the respective MMM classification additional amount for the day.
Item 15 - At the end of Division 4 of Part 1 of Chapter 4
This item sets out the amounts of payment for the viability supplement equivalent amount for flexible care subsidy.
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2012
The Aged Care (Subsidy, Fees and Payments) Amendment (Viability Supplement) Determination 2016 is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview of the legislative instrument
The legislative instrument reflects the 2016–17 Budget measure to improve funding for aged care services in rural and remote areas by using a more modern methodology (the MMM) incorporating more up to date Census data for classifying providers in regional, rural and remote areas. The viability supplement rate will also increase for most remote residential care services.
The Aged Care (Subsidy, Fees and Payments) Amendment (Viability Supplement) Determination 2016 amends the Determination to replace the ARIA and RRMA geographical classification methodologies in the viability supplement points calculator to determine eligibility for residential care subsidy and the eligibility requirements for the viability supplement in home care subsidy.
Human rights implications
This legislative instrument concerns the amount of subsidy payable to approved providers for the provision of care and services to people with a condition of frailty or disability who require assistance to achieve and maintain the highest attainable standard of physical and mental health. This legislative instrument will result in an increase to the viability supplement payable to some residential care and home care services.
Conclusion
This legislative instrument is compatible with the right to an adequate standard of living and the right to the enjoyment of the highest attainable standard of physical and mental health as contained in article 11(1) and article 12(1) of the International Covenant on Economic, Social and Cultural Rights, and article 25 and article 28 of the Convention on the Rights of Persons with Disabilities.
The Hon Sussan Ley
Minister for Aged Care