Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016

Administered by Department of Health, Disability and Ageing

Legislation au F2016L01993 Not in force Legislative Instrument

Legislation content

 

EXPLANATORY STATEMENT

 

Issued by the authority of the Minister for Health and Aged Care

 

Aged Care Act 1997

 

Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016

 

Authority

The authority for the Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016 (the Amending Principles) is section 96-1 of the Aged Care (Transitional Provisions) 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 (Transitional Provisions) Principles 2014 (TP Principles) 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 Principles will amend the TP Principles to ensure that the changes made to the Subsidy Principles by the Subsidy Amendment (Viability Supplement Principles 2016 also apply to continuing care recipients. Specifically, the Amending Principles operate so that the MMM will replace the Accessibility/ Remoteness Index of Australia (ARIA) and Rural, Remote and Metropolitan Areas (RRMA).

 

The MMM takes into account the size and isolation of a town based on 2011 Census data, in comparison to ARIA classification which relies on road distances from service centres and does not incorporate demographic factors of individual towns into its classification model.  MMM was developed by the Department of Health to improve upon targeting in workforce shortages programmes such as the GP Rural Incentives Programme.  The Review of Australian Government Health Workforce Programs April 2013 found that the strength of the MMM was that it provides an extra layer of discrimination between large and small inner and outer regional towns.

 

 

 

 

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 (Transitional Provisions) Amendment (Viability Supplement) Principles 2016

 

1                     Name of Determination

Section 1 states that the name of the amending Determination is Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 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 - At the end of section 55

This item adds paragraph (d) to section 55.  New paragraph 55(d)  provides that the Secretary may base a determination (relating to eligibility for the viability supplement) on whether the residential care service was, on the relevant day, a 2017 scheme service (within the meaning of the Subsidy Principles 2014). . 

 

 


Statement of Compatibility with Human Rights

 

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

 

Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016

The Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2014 (the Principles) are 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 Principles deal with the eligibility criteria that must be met for a residential care service to be eligible for the viability supplement for the provision of care to continuing care recipients.

 

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.

 

Overview

The Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016, enacted by the Australian Government, is an amendment to the Aged Care (Transitional Provisions) Act 1997. This legislation was introduced to address the inadequacies in the geographical classification system used for targeting the viability supplement for regional aged care facilities. The purpose of this amendment is to refine the targeting of the viability supplement by replacing the outdated Accessibility/Remoteness Index of Australia (ARIA) and Rural, Remote and Metropolitan Areas (RRMA) classifications with the more contemporary Modified Monash Model (MMM), which better accounts for the size and isolation of towns based on 2011 Census data. This change aims to ensure more effective allocation of resources to areas of greatest need, particularly in rural and remote regions. The enactment of this legislation was overseen by the Parliament of Australia, with the intent to improve the targeting and thus the effectiveness of the viability supplement in supporting quality care for elderly Australians in regional areas.

Scope and Application

The Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016 amends the Aged Care (Transitional Provisions) Principles 2014 to improve the targeting of the viability supplement for regional aged care facilities, as part of Budget 2016-17. The viability supplement is a payment made under the Subsidy Principles 2014 to improve the capacity of small, rural aged care services to offer quality care to care recipients. The amendment replaces the current out-dated remoteness classification system with the more up to date Modified Monash Model (MMM) from 1 January 2017. The MMM takes into account the size and isolation of a town based on 2011 Census data and provides a more accurate classification model for targeting funding. The amendment applies to residential care services that provide care to continuing care recipients and is made under the Aged Care Act 1997. The Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 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, including the right to an adequate standard of living and the right to the enjoyment of the highest attainable standard of physical and mental health. The Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016 applies to residential care services that provide care to continuing care recipients and is made under the Aged Care Act 1997. The purpose of the amendment is to improve the targeting of the viability supplement for regional aged care facilities by replacing the current out-dated remoteness classification system with the more up to date Modified Monash Model (MMM) from 1 January 2017. The MMM takes into account the size and isolation of a town based on 2011 Census data and provides a more accurate classification model for targeting funding. The amendment operates so that the MMM will replace the Accessibility/ Remoteness Index of Australia (ARIA) and Rural, Remote and Metropolitan Areas (RRMA). The amendment is a legislative instrument for the purposes of the Legislation Act 2003 and commenced on 1 January 2017. The Office of Best Practice Regulation has advised that the amendment does not appear to have regulatory impacts on business, community organisations or individuals.

Key Provisions

The Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016 (the Amending Principles) primarily serve to update the eligibility criteria for the viability supplement, a payment designed to support smaller, rural aged care services in providing quality care to care recipients. These amendments are made to the Aged Care (Transitional Provisions) Principles 2014 (TP Principles), ensuring that the changes implemented in the Subsidy Principles by the Subsidy Amendment (Viability Supplement Principles 2016) apply to continuing care recipients as well. Specifically, the Amending Principles replace the outdated Accessibility/Remoteness Index of Australia (ARIA) and Rural, Remote and Metropolitan Areas (RRMA) classifications with the more current Modified Monash Model (MMM), which is based on 2011 Census data and better reflects the size and isolation of towns. Under section 1, the name of the amending Determination is clearly stated as the Aged Care (Transitional Provisions) Amendment (Viability Supplement) Principles 2016, and section 2 specifies that these amendments commence on 1 January 2017. Section 3 outlines the authority for making this instrument, which is under the Aged Care Act 1997, while section 4 details that each instrument specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned. Schedule 1 contains specific amendments, such as the addition of paragraph (d) to section 55, which allows the Secretary to base a determination (relating to eligibility for the viability supplement) on whether the residential care service was a 2017 scheme service as defined in the Subsidy Principles 2014. The obligations imposed by these Amending Principles include ensuring that residential care services meet the updated eligibility criteria based on the MMM classification to qualify for the viability supplement. Providers must ensure their services align with the new model to continue receiving the supplement. Failure to comply with these updated criteria could result in the loss of eligibility for the viability supplement, potentially impacting the financial viability of the service and its ability to provide quality care. Regarding consequences for non-compliance, the Amending Principles do not explicitly detail specific offences, penalties, or civil/criminal consequences for breach within the text. However, non-compliance with the updated eligibility criteria could result in the cessation of the viability supplement payments to the affected residential care services. This outcome could have significant financial repercussions for the providers, especially those in regional and remote areas who rely on these supplements to maintain their services.

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