An update on AN-ACC

Published by Health Metrics, April 28, 2022

The Government’s recently announced 2022-23 Budget revealed that the average Australian National Aged Care Classification (AN-ACC) figure is set to be $216.80 a day.  This is above the current Aged Care Funding Instrument (ACFI) average funding figure of around $188 a day.

Combined with the $10 a day increase in the Basic Daily Fee introduced last July, providers could expect to receive around $225 per day under the new funding model.

The Budget included $468 million to continue the aged care reforms, bringing the government’s total five-pillar response package to the royal commission to $18.8 billion.  It also included a further $20.1 million to support the transition from ACFI to the new AN-ACC funding model in October this year.

However, in early April, the Coalition Government and the Labor Opposition made a decision to defer the Aged Care and Other Legislation Amendment (Royal Commission Response No. 2) Bill 2021 until a new Parliament is in place.  This will likely delay reforms and puts the Government’s five-year timeline in question.

Sector needs shadow assessments

The Department of Health commenced a ‘shadow assessment’ process from April 2021, whereby everyone living in an Australian Government-funded residential aged care facility (except residents nearing end of life) was to receive an AN-ACC assessment. 

The aged care sector has been calling on the government to release the shadow assessments and the details of pricing for 2022-23 as this is required for providers to be able to prepare their budgets and staffing needs.

While the announcement of the average payment per resident was welcome, providers need to understand the classification for each resident that determines the final price.  Without this information, providers are unable to gauge the extent to which the increased funding will cover the cost of minimum staffing levels, which may vary depending on the profile of the resident.

Providers are also concerned regarding the Budget’s failure to address wages, that could add to existing struggles to attract and retain aged care workers and at a time when more staff will be needed under AN-ACC.

Health Metrics services tens of thousands of RAC beds and the feedback from some CEOS is that they have not moved to a state of panic about AN-ACC. Rather, they are relaxed, as they are not stressing about things they can’t control. What they’re doing for budgeting is to assume they won’t be worse off. In the light of so many unknowns, this is fair for now.  The reality is, there are too many unknowns in terms of process, linking, pricing and other things. In the absence of this information, one cannot make strong judgments about the change. Health Metrics plans to introduce a series of options for providers. It will be focussed on validating the prescribed dollar-position, as well as modelling the cohort from a budget and future value perspective. We will also continue to provide advanced analytics to ensure all the most useful predictive modelling, signalling and data-driven aspects are at the fingertips of the decision makers. Watch this space.

Steven Strange, Director – Research, Innovation & Strategy

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