Aged Care: Insights from the Royal Commission so far…
The Royal Commission report into Aged Care Quality and Safety aims to transform aged care for Australians across the country. Although the final report isn’t due until April 2020, Mr Gary Barnier, an aged care expert, summarised the Royal Commission’s findings for Chartered Accountants Australia and New Zealand’s Audit Conference in Melbourne recently. Here is an overview.
Royal Commission key insights
Aged care is an incredibly complex sector. Aged care facility residents and their families should be at the heart of decision making, but these individuals are currently overlooked.
Essentially, when owners or key decision-makers of Aged Care Facilities devise business models, they place too much emphasis on funding requirements and not enough on consumer demand. Aged care service availability doesn’t meet the real requirements, according to the Commission’s findings.
What we do know is that Australians want affordable aged care and home care without strings attached. Right now, families lack the means to make informed decisions about aged care, and the lack of care providers makes it harder for families to get the best deal.
Possible outcomes from the Royal Commission
Going forward, it’s possible that the Royal Commission will recommend increased competition in the industry, through the availability of more care providers. More players in the market will likely result in stricter regulation throughout the sector to ensure that aged care service quality remains high. It’s also likely that we’ll see greater regulation over non-registered staff by creating a publicly available register..
From the insights available so far, it’s clear we can expect a greater level of enforced transparency and increased government funding to support the sector. Furthermore, aged care providers may well be held vicariously liable for decisions made by external clinicians, in an effort to protect residents.
Aged care businesses – the Royal Commission practical implications
The question for aged care providers will be how to identify a financially sustainable business model that meets evolving consumer expectations. This will undoubtedly mean investing in the right people, technology, services, and hospitality to provide competitive aged care.
Transparency is key moving forward. Consumers want to know what they’re paying for, and clinical and operational outcomes should be made available. Aged care businesses should ensure that their capital model is sustainable, and board governance is strong and reliable. Clinical overseeing at board level should also be a priority.
Aged care business should ask:
- Is the capital structure robust?
- Are we managing risk effectively?
- Is our governance strong enough, and does it align with our goals?