MARKET REPORT SUMMARY The requirement to implement new standards and reporting systems has resulted a higher operating expense and adversely affected the financial performance of the aged care providers. (Extracted from: i. KPMG Report: Aged Care Market Analysis 2022; and ii. CompliSpace Aged Care Workforce Report 2022 ) 03 04 05 The Aged Care Quality and Safety Commission (Commission) is planning to revise the Aged Care Quality Standards. The proposed changes will reduce the number of Standards from eight to seven, and consolidate some areas covered by each of the Standards. There will be new expectation statements for each of the Standards which will replace the consumer outcome statements in the current Standards. As of 17 January 2023, there is no official start date for the new Standards. It is expected that there will be a transition period to allow providers to familiarise themselves with the new Standards and to implement any systems and practices to allow them to comply. Further consultation will commence in early 2023 on guidance material for providers and older people, as well as the implementation of the revised Standards and transition periods. In August 2022, the Government passed legislation that imposed new requirements with respect to aged care governance. While all new aged providers must meet these requirements immediately, existing aged care providers do not have to meet the requirements until December 2023. There are three new requirements: (i) Membership of the Governing Body, (ii) Consumer Advisory Body and (iii) Constitutions of Providers. These requirements apply from 1 December 2023 for existing providers. For providers who are approved after 1 December 2022, the requirements apply immediately. In April 2022, the Health Care Services Union (Union) and the Australian Nursing and Midwifery Federation (Federation) brought a case before the Fair Work Commission (FWC), seeking to vary several awards to increase pay for aged care workers by 25 per cent. On 4 November 2022, the FWC released a Summary of Decision. Under the heading “An Interim Increase”, the decision states that a 15 per cent wage increase for direct care workers in the Aged Care and SCHADS Awards and nurses working in aged care who fall under the Nurses Award, was “Plainly justified by work value reasons”. The FWC also noted that this ruling would not conclude their consideration for a 25 per cent increase for employees, specifically those in administrative, kitchen, cleaning, and other support roles. The FWC further stated “Nor are we suggesting the 15 per cent interim increase necessarily exhausts the extent of the increase justified by work value reasons in respect of direct care workers.” The case is not yet resolved. The parties are discussing the issues and must report back to the FWC on 28 February 2023. The FWC will then decide on the next steps. Revised Aged Care Quality Standards New Governance Requirements Potential Wage Increase for Aged Care Workers NEW STANDARDS AND REPORTING SYSTEMS HAS ADVERSELY AFFECTED THE FINANCIAL PERFORMANCE OF THE AGED CARE PROVIDERS 59 1. Corporate Overview 3. Strategic Performance 5. Governance Structure 2. The Driving Forces 4. Sustainability Statement 6. Financial Reports
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