Conditional Adjustment Payment (CAP)

Information about the Conditional Adjustment Payment.

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PDF printable version of Conditional Adjustment Payment (CAP) (PDF 11 KB)

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Table of contents

About CAP

• What is CAP?
• Who is eligible for CAP?
• What are the eligibility criteria for CAP?
• What are the benefits of CAP?
• How much is CAP?
• Review of CAP
• How can I get further information?

What is CAP?

CAP stands for the ‘Conditional Adjustment Payment’. It is a significant payment available to eligible Approved Providers (Providers) of residential aged care in Australia.
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Who is eligible for CAP?

Providers of residential aged care who are eligible, under the Aged Care Act 1997, for the payment of a basic subsidy in respect of a resident are also eligible to receive a Conditional Adjustment Payment if they meet the CAP eligibility requirements set out in Part 10, Division 4 of the Residential Care Subsidy Principles 1997 (‘the Principles’).

Apart from a small number of Providers who have opted out of CAP, all Providers of Australian Government funded residential aged care services are currently eligible for CAP, and payment to each Provider will continue unless and until the Provider fails to meet one of the eligibility criteria for CAP, or elects not to receive CAP funding.

What are the eligibility criteria for CAP?

The eligibility requirements for the receipt of CAP are set out in the Principles. A copy of the Principles can be obtained from www.comlaw.gov.au.

In general, for Providers to be eligible to receive CAP, they must satisfy all of the following three eligibility requirements:

1. encourage staff training at the residential aged care service and provide information about the training opportunities that were offered to staff;
2. prepare an audited general purpose financial report for each financial year; and, if requested, provide a copy of the most recent audited report to residents, potential residents, their representatives and any person or agency authorised by the Secretary of the Department; and
3. participate in any aged care workforce census / survey conducted by, or on behalf of, the Department of Health and Ageing.

In addition to satisfying these requirements, Providers must also confirm that they have met the requirements of 1 and 2 above by providing an annual notice, in approved format, to the Department (by 28 February for requirement 1, the CAP Staff Training Statement and by 31 October for requirement 2, the CAP Annual Notice for financial reporting).

The CAP Annual Notice is sent to Providers around four months before it is due to be lodged. The CAP Staff Training Statement is sent to Providers around two months before it is due to be lodged.
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What are the benefits of CAP?

The aim of CAP is to improve the quality, accessibility and sustainability of the aged care sector to better meet the needs of an ageing population.

The measures are aimed at ensuring that Providers encourage staff training at the residential aged care service and that residents and prospective residents have access to audited financial reports, providing aged care residents with peace-of-mind about their service’s financial security. Prospective residents will also be better informed when considering moving to a service.

CAP will strengthen financial management and corporate governance arrangements in the aged care industry, and assist Providers to improve their services so that they can continue to provide high quality care to residents.

How much is CAP?

The amount of CAP payable in respect of a resident is calculated as a percentage of the basic subsidy amount payable in respect of a resident.

The level of the Conditional Adjustment Payment is 8.75 per cent of the basic aged care subsidy for each resident.

There is no requirement for Providers to include details on how the CAP payment was used, nor are Providers required to submit any compliance reports on expenditure of the payment.

Review of CAP

In the 2008-09 Budget, the Australian Government established a Review of the Conditional Adjustment Payment (‘the CAP Review’). The CAP Review was carried out by the Department of Health and Ageing. It was informed by submissions from aged care providers, consumers, and their representatives and by the analysis of the general purpose financial reports of Providers and other relevant data and reports.

Submissions to the CAP Review are published on the Department of Health and Ageing website at www.health.gov.au/cap.

How can I get further information?

If you require further information regarding the CAP Staff Training Statement, CAP Annual Notice and/or the audited financial reporting requirements in general, please contact Forms Administration on: (02) 4447 8022 or by email: cap@strategicadmin.com.au
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