- Aged Care Reform
- Pricing & Funding
Aged care priceides provider margins and uses seconded staff
Key points5 points
- IHACPA's cost-based AN-ACC pricing excludes provider profit margins and does not assess whether the sector is financially sustainable.
- The government adopted an AN-ACC price of $303.19 in October, which the analysis calculates is $7.72 per bed day short of the $310.91 needed to cover costs.
- The analysis estimates the shortfall at $2,818 per bed annually, or about $281,780 for a 100-bed home, and roughly $633 million nationally this year.
- IHACPA reports that 132 of its staff are seconded from the Department of Health, with the CEO the only directly employed staff member.
- StewartBrown figures cited in the analysis suggest around two in three residential aged care homes are losing money.
Summary
An analysis argues that IHACPA, the body meant to independently cost aged care, relies on 132 Health Department staff on secondment, and its pricing excludes provider profit margins and sector financial viability.
The government adopted IHACPA's $303.19 AN-ACC price in October, which the author says is $7.72 per bed day below the $310.91 needed to cover costs. Citing StewartBrown, the piece notes that nearly two-thirds of residential homes are operating at a loss. The author warns that providers asked to add beds, hire staff and meet tougher regulation without matching funding may cut investment, reducing future bed availability.